In 2024, the New Zealand housing market will be influenced by several key factors. Firstly, there is a decrease in new housing supply entering the market. The number of building permits issued for new housing construction has decreased, resulting in a limited increase in housing inventory. This shortage of supply coupled with rising demand from immigration has led to difficulties in securing housing and rent increases.
Secondly, there is an anticipated decrease in interest rates. While the exact timing and magnitude of the decrease are uncertain, it is expected to stimulate demand as mortgage rates become more favorable. This could encourage more prospective home-buyers to enter the market.
Other factors include certain properties being excluded from the rental pool due to the impact of foreign students and tourists, as well as the expected rise in the unemployment rate from the current 3.9% to 5% within the next year.These factors may cause some hesitation in the real estate market.
Overall, the average growth rate of housing prices is expected to be higher in 2024 compared to 2023 or the period after June. This is expected to put the greatest pressure on urban areas due to the net immigration flow. However, history has shown that even if cities or certain regions lead the way, the rest of the country eventually experiences stable price increases.
Source from oneroof.co.nz: by Tony Alexander
Additional commentary from him can be found at https://www.oneroof.co.nz/news/tony-alexander-three-factors-that-will-push-up-house-prices-in-2024-44841?lid=lycf94w8u0zb&utm_source=braze_campaign&utm_medium=email&utm_campaign=20240111_OR_Newsletter_Generic_Listings_MIN&utm_content=&uuid=22c8b01c-6820-4210-bd4c-003f640666d9
The opinions and research contained in this article are provided for information purposes only, are intended to be general in nature, and do not take into account your financial situation or goals.
