Housing market could stall as New Zealand enters an election year

PHOTO: National are looking likely to win the 2023 General Election by a land slide. Christopher Luxon and Jacinda Ardern FILE

The housing market could stall as New Zealand enters an election year, as both buyers and sellers wait to see if a new government will be voted in.

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Exactly how the market will proceed through 2023 is hard to predict, but December 2022 figures could suggest a slowing market. Market trends also show that people typically hold off in the lead-up to elections.

National has overtaken Labour in party support for the first time since the pandemic, with Labour dipping to its lowest result since 2017, the latest 1News Kantar Public Poll reveals. 1NEWS. December, 2022.

In Wairarapa, housing stocks have skyrocketed year-on-year, almost doubling by 99.3 per cent to 359 available houses, according to data provided by realestate.co.nz. It was the fifth largest increase in New Zealand, with all regions across the nation experiencing an increase year on year.

Wairarapa asking prices have stabilised, dropping just 0.1 per cent last month compared to November 2022. Nationwide, average asking prices rose 2.4 per cent.

Vanessa Williams, a spokesperson for realestate.co.nz said significant economic activity both within New Zealand and nationwide, as well as recovery from peaking prices during pandemic restrictions, were also contributing factors.

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“Money is more expensive than it was 12 months ago, which means there is less credit available to buyers.

“Fewer buyers in the market combined with stock increases around the motu create a perfect storm where supply exceeds demand, and buyers’ markets emerge.

“A buyers’ market gives buyers and sellers more time to negotiate and do their due diligence. It doesn’t automatically mean low prices.”

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However, houses are already sitting for longer. In Wairarapa, if no new houses came onto the market, it would take 31 weeks for all houses to sell.

Nationwide, this sits at 28 weeks and is above the historic trend of 26 weeks.

“It will be interesting to see what 2023 will bring,” Williams said.

“People tend to hold off buying and selling around elections, so we will have to wait and see if this rings true for 2023.”