AUS
NZ
UK
CA
USA
FRA
GER
ESP
ITA
NLD
PRT
SWE
GRC
IND
POL
BRA
ZAF
RUS
CHN
UAE
Summary
- As per the latest ASB Bank Housing Confidence survey, housing prices are expected to surge up in New Zealand
- As per a senior economist, ASB the rising house prices reflect better economy development than was expected before.
- The interest rates are expected to fall further in 2021.
The latest survey conducted by ASB Bank Housing Confidence revealed that the market is currently on a new high in terms of housing prices.
Mike Jones, senior economist from ASB revealed that after a short-term fall during the lockdown, the anticipated home prices have moved up again.
In the last 3 months duration until October 2020, 45% respondents hold the view that housing prices will keep on rising in the near future, while 9% of them were anticipating a decline in the second quarter.
Further Jones said that this is another sign that the COVID-19 economy of New Zealand, seems to be developing much better than anticipated earlier.
The market seems to be swaying towards different sides, with now being the best time to buy according to about 12% of people, which is a decline from the 21% last year.
With the various odds at play, such as record low mortgage rates, mortgage holiday scheme extension, as well as the early LVR restrictions removal, this fall seems to be a little out of context.
Did You Miss Reading; Has NZ housing market reached new heights?
Predictions so far
If predictions turn out to be true, the upcoming year might be even more favourable towards sellers. Till at-least the middle of 2021, it is expected that mortgage rates will fall further, and housing market will boom ahead.
The affordability factor may seem to deteriorate by next year, and the housing market will completely become seller centric if predictions are to fall in place.
For most of it, the predictions made so far have been correct. The interest rates in retail have witnessed a slow downfall throughout 2020, despite the RBNZ directed official cash rate standing at 0.25%, as of March this year.
There are efforts being made in order to lower the interest rate. The funding for lending program by RBNZ aims at keeping the term deposit rates, as well as mortgage rates monitored and controlled.
For instance, it is being predicted that 1 to 2- year mortgage rates are expected to move towards 2%, lowering down from the present 2.5%. This could happen even without the RBNZ having to put negative interest rates into play.
The Road Ahead
2021 is expected to be a time of further falling interest rates in the Kiwiland. The trend seems to be favouring housing sector in time to come together with housing confidence.
However, it remains to be seen how different factors such as the vaccine and distribution of the same across the vicinity would affect the housing market in the near future. Currently, it seems to be a good time for housing sector sellers.
