It’s now widely accepted that the property market in NZ has slowed down.
There’s been a lot of speculation in recent months about our property bubble, when it will burst and how loud the bang?
The media has been true to form with sensational headlines describing a housing ‘slump’ or ‘crash’ while the Chief Economists try to temper the media’s excitement saying it’s a market ‘correction’.
The question now is, how slow will it go?
We may not know the answer for many, many months but there are some known factors that may give perspective.
- Ongoing media commentary about ‘property slumps’ will contribute to sales and prices falling – the self fulfilling prophecy phenomenon.
- The Banks know this, which is why their Chief Economists will continue to be conservative with their predictions.
- Despite the slowdown, the Reserve Bank is still expected to increase the Official Cash Rate because of rampant inflation.
- The property market commonly slows in the run up to an election – people hold off making big financial decisions until the make-up of the new government is known.
- It’s almost election year but it’s likely to be a full 12 months before we know who will govern.
- Mortgagee sales and hard working kiwi families losing homes makes for great headlines but poor polling in an election year, so the government will be working to ensure there’s no bubble blow-out before November.
Since the speculation about the slowdown started, we have been closely monitoring traffic to the website, searches, listings, length of listings on the site and other indicators that provide market information.
Interestingly whilst the stock of property on the website has risen sharply over the past 6 months from 74,000 to now over 91,000 as a result of the slow up in sales, the traffic to the website has grown from 240,000 unique browsers to now over 265,000 last month.
Clearly the buying public of NZ are as is usual in spring actively thinking about moving home and the sale and purchase of a property, however this year with the transition from a sellers to a buyer’s market these consumers are more patient and are more actively using search facilities online. Spending longer to better prepare them with a deeper understanding of the market place well ahead of any prospective property purchase.