PHOTO: 2018 will see further market corrections
OPINION: In 2017 we finally experienced the market corrections in the residential property market that we and many said was well overdue.
We all thought the Auckland market was on fire prior to the GFC – this time it got away even more so. So will we see a major correction like 2008/09?
Note sure. What we are certain of though is:
1/ Easing of LVR’s to assist First Home Buyers
2/ The market in Auckland is already 20% back on volume versus this time last year – look to see that market down 30% in volume in 2018 versus 2017
The reason being:
a) Less Foreign Buyers…. plus China is having massive issues in many areas
b) Less investors in the market due to increased compliance costs and LVR restrictions (although these will be eased sligthly in 2018)
3/ Banks being conservative with their lending
Yes there are other real estate markets in NZ – believe it or not. The other major centres and regional markets will all experience less turnover in 2018 – expect 20% less sales in those markets in 2018 vs 2017.
Will we see a crash? Probably not – but that will all depend on Global Markets. 2018 looks volatile on the political front, China’s economic soundness is questionable and many have been predicting a Global Recession… so things could turn nasty.
At this stage – Mortgage interest rates, look likely to hold in 2018 on the back of a very low OCR. If interest rates lifted – many in the Auckland market (in particular) would be under the pump if they purchased in the last two years and have large mortgages.
Property Noise Group