Post Auckland’s Second Lockdown, New Zealanders On The Move
With many New Zealanders seeking more affordable housing options, or simply a change of scenery, as a result of the economic and social impacts of Covid-19, housing markets in smaller towns and cities like Dunedin are set to see positive growth in the coming months. The NZ housing market experienced a significant drop in sales during the strictest lockdown phase in March through to May. The pandemic and consequent flatlining of the NZ economy led many to predict that the housing market would suffer significant losses for the foreseeable future.
While the market is by no means out of the woods, it is encouraging to note the increase in both buying and selling that has occurred since June. Although it is likely that the spike in property movement in June was simply a delayed outcome of sales that would have naturally occurred in April/May had Covid-19 not hit, the continued new property listings and interested buyers remains promising.
Of particular note is how many New Zealanders are seeking property in smaller and more affordable areas of the country. While places like Auckland might soon begin seeing a drop in growth as residents start moving out of the city, these losses can be recouped in other areas. Another key interest is how returning ex-pats are also desiring to call places like Dunedin home. Their return also injects new life into the NZ economy in general, which could bode well for the housing market. Realtors such as Total Realty who sell real estate in Dunedin are set to welcome increased interest in properties, and can also expect new listings to be added over the next few months to meet the demand.
The lower interest rates are further causing many first-time housing market entrants to consider buying rather than renting, since their outlay works out to about the same, if not cheaper. Many younger New Zealanders are clubbing in with their parents to become homeowners, and while this might change the rental landscape in the future, the demand for rental properties is still solid. Indeed, areas that have predominantly been short-term rental markets seem to remain desirable rental locations, although there is a shift towards longer-term rentals, with the number of furnished listings having steadily increased since before the lockdown.
With all the changes and growth within the sector, experts still warn not to lose sight of possible pitfalls. Even though the market has not seen the initially predicted crash, the turnaround is still lower than what was reported for the same period last year. Many sales may also be hindered in the coming months with the government’s payment subsidies and banks’ mortgage holidays having ended in September. And should NZ experience a second wave of the pandemic and be forced into another strict lockdown, the future of the housing market could look less promising. For now, though, NZ’s smaller towns and cities can happily welcome the cash injections into their local economies that the current housing market trends are offering.