Ray White Now New Zealand - October Edition - Page 24

With varying levels of restrictions across New Zealand , property inspections are happening in different forms , traditional open homes with health requirements in place where restrictions allow , one on one inspections in other parts and in some cases a virtual inspection ( with appropriate due diligence ) is all it takes for buyers to commit to a purchase . This gives us some insight as to the demand side of the equation and leads us to ask the question , what really is driving this demand ?
Over the last period , listings had seen some respite during the Level 4 restrictions , which has had a lingering effect on properties available for sale . However , indications are that new listings are starting to catch up to the levels seen before the most recent Alert Level 4 . With this lower level of new property being available , it has seen a concentrated level of interest from a buyer pool that has not subsided .
# Live Listings / 28 days
3,000 2,500 2,000 1,500 1,000
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan
2019 2020 2021
Source : Ray White Online Analytics
So listings have started to recover , but demand never really wavered . What has been driving this demand , and will it continue ?
Interest Rates
Interest rates were cut to record low levels during 2020 and have remained at these low levels until the most recent rate increase by the RBNZ of 0.25 basis points on 6 October to 0.5 per cent . While this increase has signalled the start of tightening monetary policy , in the closer term , purchasing power from prospective purchasers remains very strong . It should also be noted that banks have been expecting these increases for some time and , in most cases , have been assessing potential lending at higher rates than those that are currently being offered .