In This Week’s Market Wrap:
– Reserve Bank relaxes LVR Controls
– Auction clearance rates tumble
– Nearly double the auctions of 1 month ago
Reserve Bank relaxes LVR Controls
Last week the RBNZ surprised most people with a move to ease the loan to value credit controls currently in place. To sum it up briefly banks will be able to lend to 5% more people looking to buy an owner occupied home with less than a 20% deposit, increasing their current speed limit from 10% of their total lending, to 15%. And for Investors the minimum deposit will actually be reduced from 40% to 35%.
This is good news for first home buyers, but probably not quite the news many have been wanting to hear, being a reduction in the minimum deposit requirement for an owner occupied home, however, your chances of being able to purchase with under 20%, even as low as 5 or 10%, will be better next year.
Will these changes have much impact? Well I think it’s pretty clear we are not currently seeing a resurgence in the market and obviously the Reserve Bank doesn’t think these changes will cause one either – otherwise they simply wouldn’t do it. It’s more likely they, like many, don’t want to see the market going down and obviously with changes limiting immigration and offshore buyers set to come, it makes sense to relax some of the rules our locals face in order balance things out and maintain a stable market.
Now to the Auction desk and I almost don’t want to include our clearance rate last week but in an effort to continue presenting things as they are, we sold 11 out of 48 properties under the hammer giving us a clearance rate of 23% – which is probably the lowest I’ve ever seen it here at Cooper & Co. B&T haven’t actually loaded their results but I heard they were similar – at any rate I’ll include them next week once we get hold of them.
To sum up what is probably happening – in every update in November I mentioned the rapid increase in new listings hitting the market. We went from just over 1500 listings on the Shore at the end of October to nearly 1900 by the end of November. Now we had hoped that buyer pool would also increase to accommodate these new listings as it typically does this time of year and whilst it certainly has, it doesn’t appear to have increased enough. So now as all of these new listings from the start of November reach there Auctions, it’s become pretty clear that the pool of buyers just isn’t bug enough with more than double the Auctions being called last week than just 4 weeks prior.
I don’t think this is a sign of anything ongoing, it’s just a continuation of the lumpy market we’ve been seeing all year and the more important thing to note is that for the most part and short of sounding like a broken record, prices are still stable with opportunities presenting themselves for either side of the equation, and those properties that did sell, for the most part sold for fair prices with a handful going crazy, again on both sides of the equation.
Windsor Park – A 3 bed 1 bath entry level between $800-$900 (NEXT WEEK)
Windsor Park – A modern 3-4 bed 2 bath home with great flow
Albany – An amazing high end lifestyle property set on 2Ha in the heart of Albany – VIEW TEASER
Takapuna – A brick 3 bed 1.5 bath semi-detached townhouse
Campbells Bay – A 4 bed 2 bath modern weatherboard on a large site with sea-views
Greenhithe – A spacious 3 bed 2 bath one level home
Milford – A fantastic 2 bed 1 bath brick and tile unit – one of the best I’ve seen here for some time!
Torbay – A 3 bed 2 bath on a freehold site with sea views.
Browns Bay – A gorgeous 3 bed 2 bath renovated townhouse
Murrays Bay – A 4 bed 2 bath with great views
Thanks for viewing and as always, if you have any questions by all means just give me a call.
Have a great week!