Growth, Low OCR - Perfect Storm for Property Market
Early signs of growth in the housing market are expected to accelerate following the drop in the official cash rate (OCR) by the Reserve Bank, and the traditionally busy Spring period just two weeks away.
REINZ figures show house sales increased by 3.7% in July, with the Institute saying it was the first time in eight months it’s seen the number of properties sold around the country increase on an annual basis, suggesting the property market is experiencing early signs of growth.
“Generally the market has been ticking over during winter, as there were more properties on the market at the start of the season. However, lower interest rates will help first-home buyers and increase opportunities people have to trade up in the market. It will also give more opportunities for people upgrading or renovating their home - and improve a home’s sales value”.
Spring is traditionally the property market’s busiest time, as people take advantage of the warmer weather to put their house on the market. This cycle, combined with the drop in the OCR, creates the perfect storm for buyers and sellers, especially in the regions which generally have had more buoyant markets than Auckland.
“I think spring will be strong in most areas of the country, especially with predictions the Reserve Bank will make further cuts to interest rates. We’re already preparing for a lot more listings so there will be more choice for buyers this year, which can only be a good thing for those wanting to move.
“If you’ve been considering selling, my advice is to get your property on the market as soon as you can. We’re likely to see more homes for sale in the coming weeks, and while lower interest rates help buyers, sellers will need to work harder to be heard in a busier market.”