Conflicting reports this week on New Zealand’s property market. From the Australian:
A total of 5228 homes were sold last month, the most since February last year, according to a report from the Auckland-based Real Estate Institute of New Zealand. Sales rose from a record low 3706 in January.
Sounds quite an impressive rebound right? Interest rates are at an all-time low, might be the time to jump into property investment in New Zealand? Don’t get too excited, as with any report from the Real Estate Institute of New Zealand (the Real Estate Agent’s professional body) read between the lines and take a whole large heaped tablespoon of salt!
More on New Zealand Property Investment – Is the Market Looking Up?
According to the Financial Times, house sales are set to fall to a record low next year, with less than 700,000 homes expected to change hands. This equates to households in the UK moving just once every 31 years.
Another British property consultant, Jones Lang LaSalle, announced the fact that it would be making redundancies this year. A spokesman stated:
In light of the current challenging financial and economic climate, the company has taken the difficult but necessary decision to make 60 to 80 redundancies affecting employees based in England.
No surprise really, and according to homemove back in April, a third of British estate agents could be forced to close.
There appears to be mounting evidence that New Zealand’s current interest rate cycle has hit its top: which will be a relief to those paying nearly 11% on their mortgages.
Higher fuel and food costs have also dented consumer spending while tighter international credit conditions have kept investors out of the market. The small New Zealand economy is always vulnerable to international credit crunches and the oil price is critical for a country who imports all its oil (petrol is now at NZ$2.25/litre).
More on New Zealand House Sales Drop: Will Interest Rates Follow?
