Leonie's blog

Economy on the up - figures out yesterday show the start of a turnaround, with 0.8% growth in the economy for the December quarter compared with 0.3% for the September quarter. This is the third consecutive quarter of positive growth!* A stronger economy, combined with other factors below**, is expected to set the stage for stronger house price growth next year. So, if you’re thinking of buying or trading up, now is a great time!

* Statistics NZ
** Economists continue to expect medium term housing shortages and price growth driven by strong demand (stronger economy, positive net migration and increased employment) relative to supply (low levels of residential construction, tight finance for property development with previous finance company channels no longer available, and rising costs of construction.

Where’s this market going? Short term factors and uncertainty are expected to dampen price growth (more properties on market, tax changes for investors, interest rates, focus on debt reduction and stringent lending policies).  The exact impact is hard to pick and all eyes will be on the government’s May budget (let's break out the popcorn)!   Looking out longer term, economists expect housing shortages and pressure on prices (from positive net migration, low construction levels, lower new property development by investors, improving employment and a stronger economy). For astute buyers and investors the coming months are a very good time to buy!