OCR

PHOTO: The housing market’s on edge ahead of Wednesday’s OCR announcement. Here’s what you need to know this week. FILE

Boost Your Brand with 6 Professionally Written Press Releases – Just $799+GST

🏦 1. Budget 2025: What It Didn’t Say About Housing

Last week’s Budget was more about keeping the economic ship steady than shaking up the property sector. GDP growth is expected to slowly pick up, inflation appears under control, and for the housing market—there was little to get excited about.

That said, the planned tweaks to KiwiSaver are worth noting:

  • Minimum contributions for both employees and employers are rising to 4%.

  • Government contributions are being scaled back.

This could mean slightly larger KiwiSaver balances for first-home buyers down the line—but don’t expect a game-changer.

Bottom line? From a property perspective, this Budget will likely fade into the background fast.

🏘️ 2. Market Mood: Calm, Cautious… and Kind of Balanced?

Cotality’s latest property report shows the housing market remains in “wait-and-see” mode:

  • Sales are nudging up—but nothing dramatic.

  • Prices are edging higher—but not surging.

  • Buyers can get finance and have choice—but vendors aren’t desperate.

First-home buyers are staying active, and investors are cautiously re-entering the game.

This is as balanced as NZ’s housing market gets. Expect more of the same through 2025 as falling mortgage rates meet a slow economy and tight lending rules (like looming DTI limits).

📉 3. Are There ‘Green Shoots’ in the Economy?

Don’t expect fireworks, but some signals are encouraging:

  • NZ Activity Index (April): Up 1.6% year-on-year.

  • Services Index: Still soft, with activity slipping again.

In short, the economy is wobbling between recovery and stagnation. It’s not booming—but it’s not in retreat either.

💰 4. Interest Rates: Another Cut Is Likely This Wednesday

All eyes are on the Reserve Bank this week. With inflation close to the 1–3% target band, another 0.25% cut to the OCR is widely expected on Wednesday.

But the real focus? The RBNZ’s tone. Expect scrutiny on:

  • Global risks (e.g. tariffs and supply chains)

  • Forecasts for GDP, house prices, and inflation

  • Hints at future rate paths

Don’t bet on bold predictions—the RBNZ is likely to keep options open.

SPONSORED: Unlock the Power of the New Zealand Real Estate Agents Database: Over 17,000 Agents & Agencies

🔄 5. Are More Kiwis Switching Banks for a Better Deal?

Keep an eye on the Reserve Bank’s upcoming mortgage data. The trends to watch:

  • Borrowers continue switching banks—often to score cash-backs.

  • Short-term loans mean fewer break fees—making refinancing easier.

Expect continued lender competition, especially as rates fall and homeowners look to save wherever they can.

SOURCE: Kelvin Davidson is chief economist at property insights firm Cotality

Don't be shy! Have your say....