The New Zealand property market is in the midst of a 16 year low in sales, and much like the United States and the UK has become a great market for buyers. Reserve Bank of New Zealand Governor Alan Bollard has predicted that house prices will fall 7.7% this year, and other predict even more of a drop into 2009. While sales are stagnating and prices falling, the rental market is doing quite well as demand is rising quickly.
Instead of selling, many current owners are renting out their properties, which has helped to meet the demand for rental units across the country. Also, because of high interest rates, buyers who need to borrow a lot for a new home are choosing to rent instead of purchase.
While the housing sector is stagnating, construction companies are seeing the results in new home sales. According to one report, some companies are offering discount packages that cut the cost of building a new home by as much as 45%.
In addition to the poor housing news, travel and tourism is suffering in the country as well. With the New Zealand dollar relatively strong against other currencies, it is more expensive to visit. Also, rising fuel prices are making it more expensive to travel down under, especially for those from long distances such as Europe and the US. All of the bad news for the economy means that there are good deals for home buyers buying property in New Zealand.
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