Fewer people showing up to auctions, open homes

Fewer people are showing up to auctions and open homes and there’s been a drop in the number of investors looking to buy, real estate agents say.

While this bodes well for first-home buyers looking to get into the market, most still expect prices to keep rising – suggesting the Government has more to do if it wants to rebalance the housing market.

“These results, alongside many anecdotes of continued firm bidding at auctions over the past two weeks, suggest that if it is a substantial and sustained slowing of the residential property market which the Government is seeking… then their work is not complete,” said economist Tony Alexander, writing in the latest REINZ & Tony Alexander Real Estate Survey, published on Wednesday.

The Government last month announced significant changes in how the housing market works, including the almost-immediate extension of the bright-line test for capital gains and a phasing out of investors’ ability to use their interest payments to reduce their tax liabilities, which means they pay less than owner-occupiers to service their mortgage.