fbpx

What a National-led government would mean for property investors

Picture of PropertySage

PropertySage

TRUSTED PROPERTY MANAGEMENT

A National-led government could bring significant changes to the property investment landscape based on their proposed policies:

Share Post:

The potential policy changes proposed by the National party, including a shorter Brightline Test, opening up the market to foreign buyers, and reinstating full mortgage interest deductibility, are being closely watched by property investors.

1 Brightline Test

A shorter Brightline Test may encourage some investors to buy or expand their portfolios due to reduced capital gains tax risks. It could also lead to an increase in property listings and sales from those currently struggling with cash flow.

2. Foreign Buyers

Allowing foreign buyers to purchase properties priced at $2 million or more might strain the limited supply of affordable housing further. The estimated annual tax revenue from this is likely less than projected.

3. Interest Deductibility

The phased reinstatement of full mortgage interest deductibility might not significantly boost property investment as weekly costs remain substantial even with full deductibility.

In conclusion, if these policies are implemented post-election victory for National, there could be an increase in demand for existing properties over new builds affecting prices accordingly but overall significant impact on aggregate house prices is unlikely. However, unforeseen consequences like stronger price effects in certain markets cannot be ruled out.

Source from CoreLogic NZ Kelvin Davidson

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.

Stay Connected

More News & Blog

Buyers Gain Advantage in Growing Housing Market

The housing market is looking better for buyers this year, with more listings and falling prices. In January, there were about 39,000 homes available, a 17% increase from last year, while the average asking price dropped to $842,900. This trend suggests that buyers have more options and lower prices as we enter the busiest season for real estate.

Aotearoa New Zealand Property Market Update: January 2025 Trends and Outlook

In January, property values in Aotearoa New Zealand fell by 0.1%, continuing a trend of limited movement over the past five months, with the national median value at $803,819—17.5% below peak levels from late 2021. Despite some signs of potential growth in specific areas, such as North Shore in Auckland, overall stability in property values suggests a cautious outlook, influenced by lower mortgage rates and increasing sales. However, challenges such as a soft economy and upcoming debt-to-income ratio caps may hinder a significant rebound in the market.

Trade Me Property Reports Rental Market Oversupply and Decreasing Rents

Trade Me Property reports an oversupply of rental properties, leading to a 36% increase in listings and a median rent decline to $630 per week. Landlords are advised to adjust rent expectations and enhance property appeal to attract tenants in this tenant-favorable market.