Auckland property investors: Deposit rise and limited lending possible

BNZ’s Chief Economist Tony Alexander reflects on Auckland’s housing market since the minimum 40% deposit for property investors was introduced and suggests further changes could be coming.

We are now three months into the period when banks have been implementing the Reserve Bank’s policy of requiring investment property purchasers to have a minimum 40% deposit. The evidence to date from this change is that buyers have backed away from the market, resulting in lower auction clearance rates and properties taking slightly longer to sell. Continue reading…

Investors nerves on edge as US election approaches

BNZ Private Bank Analyst, Katie Thompson, gives us an overview of the current state of play and what you can expect to see in financial markets in the lead up to the US election day.

The US presidential election will take place in just over four weeks, on 8 November 2016. The thought of Republican candidate, Donald Trump, becoming the president of the world’s largest economy is making investors nervous, and setting the stage for more market volatility, given his unconventional views and lack of clear policy direction. Continue reading…

The Brexit effect

BNZ’s Director of Institutional Research, Gary Baker reflects on Kiwis online retail spending post Brexit.

Post Brexit increase in online spending
Last month’s Brexit vote may be a distant memory for many, but it clearly made an impact on many New Zealanders online spending decisions. Online spending by Kiwis on UK websites surged in the week immediately following the vote – up 47% compared to the same week in 2015. Continue reading…

The tricky truth behind our falling homeownership rate

BNZ’s Chief Economist Tony Alexander reflects on trends in Auckland’s housing market.

Much has been made of data released in recent years showing a downward trend in the rate of home ownership in New Zealand from an estimated 74% in 1991 to an estimated 65% in 2013. There are many problems with the calculation including a lack of knowledge of who owns about 20% of the country’s housing stock and houses moving into family trusts. Continue reading…

Today’s inflation forecast: Subdued, with a chance of increased credit control

What are the chances that interest rates will rise sharply, cause big cash flow problems for home owners, and produce a 10% plus decline in Auckland house prices? Very slim. Why? Because the key driver of rising interest rates is rising inflation and central bank efforts to fight it, and all around the world apart from Venezuela inflation is low and showing little sign of rising. Continue reading…

The buyers are back: Auckland’s housing market

Last month I wrote about the way in which data for Auckland were suggesting that the pause in Auckland’s housing market following the October introduction of an IRD number requirement had ended. The March data confirm this. After rising on average by 5.5% in February Auckland sales prices rose another 4.3% in March. Sales were down 12% from March 2015 and this goes to show that what caused the pause was not sellers placing properties on the market but buyers holding off. Now they are back. Continue reading…

Data crunch: An update on Auckland’s housing market

There are many statistics which get thrown around regarding the Auckland housing market. Personally speaking, as a macroeconomist, I ignore the data broken down by suburb though for many people that is the most important information. Instead I look at numbers for the city as a whole. My preference is the REINZ dataset which is more up to date than the Core Logic/QVNZ information. Continue reading…