PHOTO: Tony Alexander
This month all of the main indicators we track and discuss have shown reduced buyer demand and decreased upward pressure on prices. Most notably our FOMO reading (fear of missing out), which is the only such gauge available in New Zealand, has fallen to a level not seen since April last year when the country was in its first nationwide lockdown and house prices were widely expected to decline.
Investors have become less willing to buy, but it is first home buyers who have strongly stepped back from making a purchase for now. Feedback from agents shows that prospective buyers have experienced substantial difficulties obtaining finance from banks as they apply debt to income ratios, assess expenses more deeply to meet requirements of the Credit Contracts and Consumer Finance Act, and temporarily stop low deposit lending other than for new builds to meet new LVR requirements.
The good news is that requests for appraisals have risen, more vendors appear to be stepping forward with more realistic assessments of market prices, and price growth is slowing to a pace likely to please both the Government and the Reserve Bank.
READ THE FULL REPORT HERE: Tony Alexander_Report_December_2021
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