NZ: Softening in housing market conditions - Westpac

Satish Ranchhod, Senior Economist at Westpac, notes that Barfoot and Thompson figures for December pointed to a firming in the Auckland housing market in late-2017.

Key Quotes

“We expect that this will be temporary. Indeed, looking at the longer-term trends in the housing market, a softening in conditions over the past year remains apparent.:

“Barfoot and Thompson figures for December pointed to a firming in the Auckland housing market in late-2017. However, we expect that this will be temporary.”

“December is usually a soft period in the housing market. But after adjusting for normal seasonal variations, we actually saw an uplift in prices and sales over the month compared to November 2017. This corresponds with the downwards pressure on borrowing rates late last year.”

“Nevertheless, looking at the longer-term trends in the housing market, a softening in conditions over the past year remains apparent. Despite their recent firming, sales are still well down on levels seen over the past year. Price growth has flattened off. And the stock of available listing continues to climb.”

“We expect that the housing market will continue to slow over the coming year in response to concerns about changes in government policy and pressure on borrowing rates.”