PHOTO: LVR (loan-to-value ratio). FILE
“The numbers are not unexpected, but the good news is the Reserve Bank is set to ease LVR (loan-to-value ratio) restrictions which will help more first-home buyers into the market,” says Tim Kearins, Owner of Century 21 New Zealand.
Mr Kearins’ comments follow REINZ releasing its Monthly Property Report for April – a month which saw median prices across New Zealand decrease 10.9% year-on-year to $780,000. Days to sell have risen to 47 days for April 2023 — up nine days compared to April last year.
REINZ reported: ‘Salespeople across the country are reporting glimpses of green shoots in the market this month as first home buyers show more interest after the Reserve Bank’s announced on the easing of LVR restrictions. Our members are seeing further alignment as vendors come with a desire to meet the market…’
“It’s pretty slow, but understandably. Kiwis are playing a wait and see game – as to inflation peaking, interest rates settling, and of course we have a general election in October which always sees some stalling. For those looking to buy, however, opportunities are plentiful with vendors increasingly realistic,” says Mr Kearins.
The Reserve Bank is currently proposing to ease LVR restrictions from 1 June from a 10% limit for loans with an LVR above 80% for owner occupiers, and 5% limit for loans with an LVR above 60% for investors to a 15% limit for loans with an LVR above 80% for owner occupiers, and 5% limit for loans with an LVR above 65% for investors.
“The fact that banks will soon be able to approve more of their new lending to owner-occupiers borrowing more than 80% is good news. Nonetheless, borrowing remains tough,” says Mr Kearins.
At the end of April, the total number of properties for sale across New Zealand was 28,643 -up 1,593 properties year-on-year.
“There is choice as well as opportunity, with properties on the market for longer. With winter only weeks away, it could be a good time for buyers to strike. Talk of a recession will see many vendors keener to sell sooner rather than later,” says Mr Kearins.
Contact: Tim Kearins – Century 21 New Zealand – (0274) 495-547
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