The New Zealand property market has recently been on a rollercoaster ride - for many, this has meant putting a halt to their financial plan. But financial progress shouldn’t be waiting for perfect conditions to take action.
If you've been waiting for the opportune moment to dive into property investing, there is no time like the present. The good news is that the property market is showing signs of recovery, signalling a potentially positive outlook for 2024.
Recent market data from the Real Estate Institute of New Zealand reported by OneRoof has shown a steady increase in house prices since April, hinting at a possible phase of recovery. While returning to peak levels is unlikely to happen in the next year, values are still expected to lift by 2.5% (per ASB, August) or 7.7% (per Westpac, November).
So there are many reasons why now is a great time to start thinking about when and where you might buy.
Despite high inflation and living costs, the demand for housing continues to rise due to growth in population. Recent provisional migration data shows a net gain of 129,000 as of October 2023. Economists are estimating an additional 43,000 homes needed to house these new arrivals.
But while the overall property market is experiencing a come-back, some regions have better potential than others. It’s essential to identify the right property opportunity that will help you achieve your goals, and act as the solution for the problem you’re trying to solve.
The plus side is, here at Momentum Realty, we only select properties with great growth or yield potential. Here is where we see great potential for future gains:
There are signals that the OCR may start to go down near the end of 2024. It may be tempting to hold on and wait until that happens, but waiting for the “perfect conditions” could hinder your financial progress.
While mortgage rates are high, this means fewer people in the market to buy, and greater opportunity to secure a better price than if you were to wait. Conversely, once mortgage rates begin to drop, more buyers will have the means to purchase, increasing the competition and, in –turn, driving prices up.
In times of uncertainty, the smart money is often actively seeking opportunities while the rest sits tight. Hesitation can be the biggest setback to growing long-term wealth, because doing nothing is a decision in itself.
As we move forward, adopt a mindset focused on identifying and seizing opportunities. The current market conditions, combined with the projected shift in mortgage rates, create a fertile ground for those willing to act.
To wrap up, the New Zealand property market is signalling a positive return for 2024. However, not all properties are made equal. So it’s essential to do your research, identify locations with the potential for growth, and take action when you’re ready instead of waiting for the perfect conditions.
While property investment may seem simple from the outside, there’s a lot that goes into buying the right property and making sure you can hold it through the fluctuations of a property cycle. In this guide, you’ll find everything that you need to know about what makes property such a powerful investment option, and how to make sure you buy the right investment property to meet your financial goals.
Click here to download the New Zealand Property Investor Handbook by Momentum Realty.