PHOTO: As New Zealand’s housing market cools after years of growth, some first-home buyers are hoping they can finally enter the market. FILE
In one neighbourhood, the first metric was the letterbox: a thickening sheath of “For Sale” advertisements clogging up the mail. “Almost daily junk mail advertising houses for sale,” said Greg, who lives in the central North Island city of New Plymouth. Then he noticed things changing on the street. “Every house on our road that has sold since we moved in three years ago has sold within a week,” he said. “But now the house down the road has been on the market for about a month with no signs of moving.”
The same trickle of symptoms are becoming visible in many cities across New Zealand: for-sale signs staying up as the lawns grow around them, auctions passing by with no bids, listing pages mounting up on real estate websites. For years, the country’s housing market has been on a seemingly-unstoppable upward trajectory, with homes in major centres averaging at over $1m a pop. Now, New Zealand is in the midst of some of the largest drops and slowdowns since the aftermath of the global financial crisis. Some banks are predicting a 10% fall over the course of 2022.
The Guardian asked readers to share how they were experiencing drops in the market, and found a mixture of trepidation, relief and hope.
As economists warn of “monster” inflation that could push mortgage payments up, some of New Zealand’s locked-out homebuyers are hoping they might be able to pick up the pieces.
“I’m partly excited about this, any change from the sky-high property market of the last two years is a potential ‘in’ for me as a first homebuyer,” said Megan, 35, a design director from Wellington. “However I’m also terrified of the looming recession and what that means if I were to be dealing with a mortgage for the first time as well as new costs like insurance and rates.”
For some, it’s the first glimpse of a chance at owning a property. “My partner and I believe the drop in prices mean we might be able to purchase a house this year,” said Shayna,* an IT worker in Wellington. “We’re going to wait a few more months to see if it drops slightly more. We’re lucky to be in the fortunate position of having an above average, double income and potential help from parents – I think we would really struggle if it weren’t for these factors, but we’ll see what happens.”
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