New Zealand Property Prices Back to “Fair Value”
Published on Friday, April 24th, 2009
According to the Westpac Bank, prices for property in New Zealand have now fallen to a fair value, based on rents, interest rates and other costs. This is the first time that real estate in New Zealand has been below a reasonable price that investors should pay since 2006.
Westpac Bank economists are predicting a 5% drop in New Zealand real estate values for 2009 too, and flat line movement for the market in 2010.
The Reserve Bank forecast however is a little gloomier, with predictions of a 20% drop in New Zealand house prices from their peak in late 2007, to a bottom sometime at the end of 2010. But with prices having fallen nationally around 8% since the peak, they have almost lost half of their predicted depreciation already.
Founded by English settlers in 1851, Christchurch became a city by Royal Charter in 1856, making it the oldest city in New Zealand.
It’s all too easy to become obsessed with the financial market at home, the property market in the UK and the state of the jobs market across the British Isles – but some of us need to be casting our eyes a little further afield and keeping abreast of pertinent activity in the location we’re contemplating emigrating to.
The property market in New Zealand is no longer going from strength to strength – far from it in fact. Leading economic experts are predicting something of an impressive crash in prices, and already this is having a knock on effect with many vendors withdrawing their homes from the market rather than face the fact that they will have to take lower than market value offers if they want to sell.
When you’re researching going to live on the other side of the world there is an awful lot to explore and one of the fundamental things to get as right as possible is the location in which you’ll land. And no, I don’t mean which airport you’ll fly in to, I mean which town, city or even rural environ you’ll choose to call home when you arrive.
The vast majority of information that we’ve ever published about property abroad on Shelter Offshore relates to buying rather than renting – but when it comes to nations such as New Zealand, Canada and Australia, those emigrating to live there often want or need to rent before they buy a home. After all, the logistics involved in organising such a long distance international relocation and a home purchase at the same time are almost impossible to comprehend let alone cope with!
The reasons to buy property in New Zealand far outweigh the reasons not to – for example, the fact that the nation is roughly the same size as the UK but has a fraction of the population means that there is plenty of space for each citizen, additionally there is lower unemployment in New Zealand than in the UK and the cost of living is lower too. Despite a house price boom of late, property prices are also more affordable AND the process to purchase real estate is as simple as it is in Great Britain.
The majestic snowcapped mountains, beautiful waters and friendly people combine to make New Zealand a paradise for holidaymakers, retirees and expatriates. With an estimated 215,000 Brits already calling this country home, the property market in New Zealand has enjoyed a long story of growth and prosperity. All of that is starting to change as higher interest rates and falling buyer confidence take their toll on the New Zealand property market.
