Property experts and agency heads give insight into the 2023 market, and it’s a more positive outlook than you might expect. If you are looking to sell this year though, there are many macro factors at play, so we’ve gathered advice on the best time to hit the market.
What can we expect to see happening early this year?
It’s unlikely short-term or floating mortgage rates have peaked but longer-term rates may have, according to CoreLogic chief property economist Kelvin Davidson. We should consider, “even if mortgage rates are close to, or at a peak, this doesn’t change the fact that it’s still expensive to be a new borrower and that many existing borrowers are yet to face up to the full extent of the rate increases already seen,” says Kelvin.
Kelvin suggests keeping an eye on the Quarterly Consumer Price Index figures, with an OCR rise expected in February. In Q4 of 2022, the rate of inflation remained steady, at 7.2%. While this wasn’t the drop some had been hoping for, it did offer some respite from the Reserve Bank’s expectation of a rise to 7.5%. Despite these results, Kelvin suggests we shouldn’t expect it to halt the planned OCR hike of up to 0.75%.
While many were already expecting that house prices will continue to fall this quarter, these inflation figures further reinforce that expectation.
Is it a good idea to sell right now?
For homeowners looking to sell this year, real estate leaders suggest that the first half of the year is a safer bet than the second. With the national election looming, the market may slow down later in the year.
Bayleys Head of Insights, Data and Consulting, Chris Farhi says Bayleys agents are seeing more buyer activity than they were expecting in the New Year, an experience echoed by other agents around the country. Buyers currently in the market have a good selection of properties and a strong opportunity to negotiate on conditions. “People feel like they can get a good home in the current market,” says Chris.
It’s unlikely that house prices will see radical change in 2023. Real estate experts predict price declines will continue, but they are not expecting the dramatic fall we saw following the peak a year ago. Chris estimates a decrease of 2-3% this quarter, compared with the 4-5% drops we saw last year.
Harcourts Managing Director Bryan Thomson suggests it’s a great time to trade up. “What people sell for and buy for is irrelevant. If they’re trading up from their first home to a family home, the price gap will be smaller.” If it’s one of those normal life events and you plan to buy a house that you’re going to live in for years, then you should get on and do it, he advises.
This information is not intended as a complete guide, as it doesn’t consider your individual needs or financial situation. Homes.co.nz accepts no responsibility or liability for any inaccuracies or omissions in the content. Always obtain independent legal advice before buying or selling property.
Monthly Property Update
February 2023
The homes.co.nz Monthly Property Update is generated using homes.co.nz’s February 2023 HomesEstimates, providing an up-to-date perspective on house values around New Zealand.
Trends in our Main Cities
The median HomesEstimate continues to inch downward with minimal movement across all of our main cities in the last month.
How do we calculate these figures?
The homes.co.nz Monthly Property Update is generated using homes.co.nz’s monthly HomesEstimates and provides an up-to-date perspective on house values around New Zealand. By valuing the entire housing stock, the homes.co.nz Monthly Property Update can compare median values from month to month in a consistent and reliable way. Our HomesEstimates are calculated for almost every home in New Zealand by an algorithm that identifies the relationships between sales prices and the features of a property.
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NZ’s First Home Buyer HomesEstimate
The “First Home Buyer HomesEstimate” is homes.co.nz’s estimate of what a typical first home may cost. It is calculated to be the lower quartile HomesEstimate in a town.
