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2018 'a consolidation year,' - Barnett

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Fuseworks Media
Fuseworks Media

"Real estate in 2018 will be steady with plenty of opportunities out there for both sellers and buyers alike. This year will mark the return of a more normalised market showing greater realism and genuine sustainability than the crazy days of two or three years back," says Geoff Barnett, National Manager of Century 21 New Zealand.

His comments follow the recent release of industry figures for December by

They show the average asking price nationally hitting an all-time high, new listings dropping, Auckland moving from a sellers’ market to a buyers’ market, and supply slowly closing in on demand with the country’s housing stock up 9.3% compared to December 2016.

"December is traditionally a quieter month when it comes to real estate, so we won’t really get a feel of what’s happening until the January and February numbers come through. However generally the market continues to show some positive signs."

Mr Barnett says end of year REINZ figures revealed some strong price growth in many parts of regional New Zealand and a good lift in sales activity for many provinces.

"Let’s not forget that the median house price in Auckland was up by the end of 2017, albeit only just. Yes, things have levelled out for Australasia’s fastest growing city but its long-term prospects remain strong."

He says the lower North Island has seen some good price escalation in recent years and the future of the capital city is assured.

"The Reserve Bank is anticipating ongoing relatively low interest rates this year, with many fixed rates still well under five percent. This makes it a good time for many Auckland renters in particular to run the numbers on a mortgage calculator, if they can then come up with a deposit.

Last year Mr Barnett was one those who called for a review on the LVR restrictions, after the Reserve Bank’s tougher loan-to-value ratios had successfully taken much of the heat out of the market as had government measures to increase the country’s housing supply. Since 1 January, LVR restrictions have been softened somewhat which will help more first-home buyers to get into the market in 2018, he believes.

"Demand is still outstripping supply, so we can expect to see plenty more developments and subdivisions come to the market this year and next. And while sales times may have extended on 12 months ago, we’ll continue to see plenty of willing buyers and vendors negotiating fair prices both parties are happy with."

Mr Barnett says the underlying strength of the New Zealand real estate market continues to prove many commentators wrong.

"I believe what we’re now seeing is the market entering a consolidation period and subsequently this year we’ll see more vendors getting a little more realistic as well.

"Thanks to ongoing population growth, solid economic forecasts and confidence, and low interest rates coupled with more realistic house prices - plenty of good opportunities remain for Kiwis when it comes to real estate in 2018," says Mr Barnett.

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