The property market may not be lighting up the scoreboard, but the game is starting to open up. First-home buyers are finding space, mortgage lending is pushing forward, and the banks keep shifting formation on rates.
First-home buyers are now New Zealand’s most active buyer group, accounting for 27.7% of purchases so far this year. Their purchases are up 2.4%, despite total sales falling 4.7%. In Auckland, they make up almost 31% of buyers, while in Wellington it is close to 39%.
National property values were down just 0.1% over the past quarter and 0.6% annually. Auckland remains 2.6% lower than a year ago, while Christchurch continues to outperform with 3.2% annual growth. High stock levels mean buyers still have plenty of choice and negotiating power.
Banks approved $8.63 billion in new mortgage lending during May, up around 8% from April. First-home buyers borrowed $1.68 billion, with more than half of that lending going to borrowers with less than 20% equity. Investor lending also lifted from April but remained about 12% below May last year.
ANZ reversed its early-June increases, returning its special one-year rate to 4.65%, with two and three-year rates falling to 5.29% and 5.49%. BNZ went the other way at the short end, increasing rates from six months through to two years, while cutting its three, four and five-year options. It is less a clear rate direction and more a choose-your-own-adventure.
A typical lower-quartile home now costs $600,000 nationally, but $790,000 in Auckland. With a 20% deposit, the Auckland repayments may be manageable for a typical first-home buyer couple. Drop the deposit below 20%, however, and estimated repayments jump from around $804 to $1,030 a week.
Labour proposed a $950 million Crown guarantee for Community Housing Funding Agency social bonds. It says the policy could reduce community housing providers’ borrowing costs by around half a percentage point, allowing more affordable homes to be built from the same funding pool.
That's the TLDR this week
We are not into stoppage-time drama just yet, but the momentum is starting to build. Buyers still have the ball, banks are competing for possession, and the market is finally showing a little more attacking intent.
Disclaimer: This article is general market commentary only and is not financial advice. Property markets, lending criteria, and interest rates can change quickly, so always do your own research and seek advice based on your own circumstances before making financial decisions.