Key Facts

  • House prices in New Zealand are expected to rise, but the rate of increase might be sluggish.
  • Multiple factors contribute to the rise, including a limited number of listings, easing loan-to-value restrictions, relatively flat mortgage rates, a robust labour market, and robust net migration.
  • Rent prices have gone up more rapidly than usual, with a 5.5% increase compared to last year.
  • An uptick in immigration and a decrease in investor activity have reportedly led to fewer rental properties and thus, increased rents.
  • Government assistance such as accommodation support, temporary additional support payment, independent earner tax credit or Working for Families system might be available depending on your situation.

Article Summary

Even though house prices in New Zealand are forecast to surge, the rate of growth is likely to be relatively slow. The growth is not specifically related to the change in Government, but instead contributed to by a range of factors. As explained by Corelogic’s chief economist, Kelvin Davidson, these include a smaller number of property listings, slightly relaxed loan-to-value restrictions, stable mortgage rates, a solid labour market, and strong net migration. However, these rises could be dampened due to stretched affordability and the potential introduction of debt-to-income restrictions.

On a similar note, rent prices have also seen a significant increase across the country, with a rise of up to 5.5% compared to the previous year. Again, multiple factors are playing a role in this rise, including an increase in net migration leading to an increased demand for rentals, and reduced investor activity causing fewer rental properties to come onto the market.

Individuals struggling with these increases can potentially receive government assistance to help cope with the rising cost of living. Types of aid can include payments like accommodation support or temporary additional support for low-income earners, the independent earner tax credit for those earning under $44,000 annually, or the Working for Families system for households with children.

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