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ASB Housing Confidence Survey: Price Expectations Highest In Two And A Half Years
ASB’s latest Housing Confidence survey shows house price expectations continue to increase, with net 51% of New Zealanders expecting them to rise – the highest net reading recorded since October 2021, before the start of the most recent housing market downturn.
ASB Senior Economist Kim Mundy says while expectations for higher house prices were evident across the country, Aucklanders are the most confident the tide has turned on pricing, with net 56% expecting higher house prices ahead.
“Last time net house price expectations were at this level, annual house price growth was at almost 30 percent. As of January 2024, annual growth was a more muted 2.2%, reminding us that house price expectations are more of a directional indicator than a reflection of what the market is doing.
“While house prices are likely to continue rising, we’re not forecasting the type of growth we saw in the last upswing over 2020 and 2021, with still-high interest rates acting as a powerful market moderator.”
New Zealanders are braced for the high interest rate environment to continue, but only net 15% of respondents are expecting further rate hikes, down from 28% in the three months to October, which suggests more people think a peak in rates might be just around the corner.
As for whether now is a good time to buy a property, New Zealanders appear to be firmly on the fence, with 51% of respondents saying it’s neither a good nor bad time to buy. This lack of conviction in the state of the market has been the case since the end of 2022.
“We acknowledge there are quite a few conflicting signals for prospective buyers: a turning market, policy changes, high debt servicing costs, possible debt-to-income restrictions and upfront affordability constraints.”
The full ASB Housing Confidence Survey for the three months to January 2024 will be available online at www.asb.co.nz. Other recent ASB reports that also include housing commentary can be accessed via a Search page https://reports.asb.co.nz by selecting the keyword ‘Housing’.
Note to editors: The ASB Housing Confidence Survey was constructed from data received from 2926 individual respondents.
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