The Property Market in Review

Over the last few months there has certainly been a change in the tone of news reports and articles in the media as to the state of the Property market. This has been true in the Auckland property market in particular but generally country wide the news is positive.

Where we have been

The doom and gloom stories of price downturns and mortgagee sales is on the decline, and now it seems the stories are about housing shortages, tenants not being able to find rental accommodation, increases in weekly rental amounts, and property sales volumes and values increasing dramatically in certain areas, especially Auckland.

Property Investment NZ markets have been in a slump phase since the end of 2007. Over this time have seen a higher supply of properties for sale compared to buyer demand, this has resulted in a correction to property values. New home build rates have been low over this time also and of course with the Christchurch earthquakes many homes have been taken out of the market completely.

Where we are heading

But times and markets move and for the Christchurch Quake effected home owners this means new homes being built and high rental demand. Because of this many cash-rich investors are putting their money into the property market, so with buyer demand now increasing, to equal or in some areas exceeding supply of properties for sale, we are seeing competition heating up from buyers and this means that prices will rise.

Most investors or home buyers wait for the positive news stories on housing markets and when it is good news their confidence grows and they will begin buying again, this becomes a snowball and as many more investors buy in the good news spreads and this drives demand and prices upward.

The property market is driven by supply and demand and is cyclic with its various boom and slump cycles in a fairly predictable pattern. Knowing when to jump in to maximize your investment is the age old question. But if you sit back and never test the water then you will be the one saying ‘I wish I bought that property back then, when it was cheap’.

For further reading on Property Investment NZ, click on the articles below:

Setting Goals for Financial Independence – click here

Tips for Becoming a Property Expert – click here

Buying Rules for Property Investment – click here

5 Tips to Add Value through Renovation – click here

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