The New Zealand real estate market can be a bit sluggish to take off after the summer holidays, but it looks like supply is back in full swing, with the biggest property listings since 2013 emerging in Auckland.
In Unconditional's property report for February 2016, a grand total of 11,989 properties were listed on the market. In particular, Auckland saw 4,202 properties listed - the best February result since 2013. So we know more and more homes are coming to market, but what does it actually mean for house hunters and property investors?
Data from the Reserve Bank shows that in January this year, there was just over $4.1 billion loaned out for residential real estate. One year before, this figure was just above $3.5 billion. So more people are taking out money, or we're paying more for homes. Either way, greater listings haven't had an easing effect on demand yet.The basics of supply and demand dictate that if there's more of something, the price it sells at should go down. Unfortunately, it doesn't apply to Auckland. This is because even though there is almost a three-year high for property listings, supply is still being outstripped by demand.
The Unconditional report noted that while there was a spike in listings for Auckland, the asking price for homes also reached a record high. This indicates that while there's sound supply coming through at the moment, first home buyers and investors are probably contending with a glut of more expensive properties.
As supply rises and prices rise with it, many people looking at taking out a home loan will find themselves hard up against some rough market conditions. That's where taking on the right mortgage advice and planning well into the future will prove vital for making a successful property purchase.These are the type of conditions that can drive investors out of the Auckland market, particularly to places like Hamilton and Tauranga. As our adviser Paul Davey discussed recently, this is already happening in full force.
Whether you're a seasoned investor or a first time buyer, the team at Squirrel is ready to sort you out with tailored advice and solutions that get you exactly where you want to be on the property ladder.