The strong interest from first home buyers for at least the past 12 months has been driven by a number of factors. Prices had fallen substantially since the peaks of late-2021 before the credit crunch hit. The number of properties listed for sale has been running near twice the low-point in 2021 of below 14,000 nationwide.
Competition from other buyers and especially investors has been light. There has also been through the past 12 months some mild easing of bank lending policies assisted by two bouts of tweaking the CCCFA changes introduced in December 2021.
Young buyers have also been encouraged to make a purchase by the strong growth in their incomes. The cost of living for an average Kiwi household may have risen 20% since 2019. But average wages have gone up by 25% and for young employees the gains are likely to be greater because of their high propensity to shift employer in early years.
Add to these factors the savings (deposits) built up during the pandemic and it is not hard to understand the strong first home buyer demand. Ahead of the general election last year things cooled down a bit and volumes have yet to restart the firm upward trend seen during the June quarter.