Recent comments from BNZ’s confidence survey results issued at the end of March around the property market included:- Real estate appears weak with few buyers;
- Things appear to be on hold until the budget in May due to the tax changes;
- The comments from the survey in general suggested that the economy was improving slowly.
There is a large volume of houses on the market for sale but this is not translating into higher sales volume. It is believed the low sales volume, although higher than the record low in January 2010, is “fluctuating” as many people simply do not know where the property values are going and so are reluctant to commit. It is believed this reluctance is due to a fear that they will over commit themselves, especially if mortgage interest rates increase. Those buyers in the market are believed to be owner occupiers
Property Cycle Indicator
The Mike Pero mortgages – Infometrics property cycle indicator (“PCI”), for February fell to 3.97 (5.22 in January).
The PCI provides a value between -10 (strong downturn) and +10 (strong upturn) in the housing market. As its base data it measures the number of houses sold, the time it takes houses to sell and the changes in prices
The number showed an easing in the housing market.
Auckland market a dog
A report put out by BERL economists and The Institute of Public Policy looking at the Auckland economy stated that there was too much conflicting information on the Auckland housing market and simply described it as a “dog’s breakfast”. The only real conclusion was that there was so much conflict in the numbers coming from different sources that the only certainty was the uncertainty of the housing market.