The REINZ stats for July are out, and we are seeing a similar market to our last update in June. While it’s normal that things are generally more stagnant over winter, many people (especially investors) are a little more hesitant to make moves until they know the result of the upcoming election.
We have noticed there are very few investors around, as a change in government could likely make things much easier for those looking to invest, so many are choosing to hold off until the result is announced. This means it’s an open playing field for first home buyers and owner-occupiers with less pressure and less competition.
There is the expectation that if there is a change in government and the investors come back, that this could put upward pressure on availability, which in turn could begin to drive prices back up. It’s for this reason that now is a good time to buy as competition remains low.
Interest rates are still at a high, and it’s expected there could still be a little room for upward movement if the RBNZ follows through on its promise to raise the OCR in the later part of the year. However we don’t expect to see any big jumps in interest rates like we have the past year or so. Instead, the fact that the long term fixed rates are currently much lower than the floating rate, indicates that the banks and lenders expect the interest rates to begin dropping towards the end of the year or start of 2024.
In the Canterbury region, the average house price for July was $658,000 which is a 0.3% drop on June and a 2.5% drop on this time last year.
For Christchurch specifically, the average house price sits at $649,000, down 0.2% compared to June and down 1.7% from last year.
Across the Canterbury region, the medium days to sell time sits at 38 days, which is more than the 10 year average for July. This means houses are taking their time to sell, which is due generally to lack of pressure on buyers to make decisions and little to no property chain hold ups. This is where buyers and sellers are relying on other properties to sell before they can make a move.
Overall this current market makes for a good time for first home buyers, with low prices and less competition. If you can afford the interest repayments on the current high rates, then now would be a good time to secure a loan. If you aren’t sure how much you might be able to borrow or afford, then get in touch with us and we can help you determine your home budget and present you with all of the options.