PHOTO: Independent economist Tony Alexander. FILE
A recent real estate survey indicates a decrease in the number of agents observing an uptrend in house prices within their respective areas. The New Zealand Home Loans Property Report, conducted by independent economist Tony Alexander and released on Tuesday, sought insights from industry professionals regarding the prevailing conditions in the residential housing market. Real estate agents were questioned about shifts in activity levels, perspectives of first-home buyers and investors, and factors influencing sentiment in these segments.
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Out of the 324 respondents, a net 28 percent of agents noted price increases in their locations for November, marking a decline from October’s figure of 34 percent. Despite an initial surge in buyer demand having subsided, the survey suggested that the momentum for price growth persists.
The survey identified a significant shift, with agents perceiving continued price increases in all locations except Taranaki, Manawatū-Whanganui, and Southland. However, the Fear of Missing Out (FOMO) experienced a decline, dropping to 28 percent from 33 and 40 percent in the preceding two months. Notably, no agents reported observing FOMO in Taranaki and Southland, while 48 percent noted it in Wellington. Overall, the FOMO indicator led the report to assert that there is no ongoing frenzy in the residential real estate market across New Zealand.
Moreover, 47 percent of agents reported an increase in first-home buyers in the market, a notable surge compared to the average of 13 percent over the past three and a half years. This suggests that the recent trend of a higher proportion of sales involving young buyers may persist through the summer, unless there is a sudden influx of investors.
Despite expectations of a rush of investors, November did not witness any significant increase, with only 22 percent of agents reporting a rise in additional speculators. Buyers’ primary concerns centered around interest rates, access to finance, and the availability of listings. The fear of overpaying gained prominence again, with 16 percent of agents stating that buyers were apprehensive about prices falling after their purchases, up from 10 percent in October.