Will they or won't they?

Posted by lindsay on April 20, 2014

Last year the NZ Herald reported that house prices are starting to fall. A week or so later they appeared to change their mind somewhat, speculating that 2013 might not see any signs of easing. 

That said, the one thing all parties did agree upon, was on the speculation surrounding long-term price sustainability. Will there be enough persisting momentum to take high property values through to the end of the year or will they fall as a result of the inevitable raising of mortgage interest rates? And, of course, much of this same speculation has continued into 2014 with mixed confidence over what lays ahead in the NZ housing market.

Case in point, a slight pricing adjustment has already been noticed in the outer provinces of Auckland. This has left some forecasters to suggest it’s only a matter of time until things shift inward. However inner city property investors are already starting to experience the pinch through poor rental returns. Unfortunately low wage increases are not keeping steady with inflation. 

“It’s hard to pin down much to get excited about,” when it comes to buying property the article noted. Ultimately, it’s going to come down to how quickly rates climb and what other economic influences emerge.