Competition between banks helping property in New Zealand

More first time buyers are climbing onto the housing ladder in New Zealand thanks to increased affordability and more intense competition between banks.  That’s the conclusion of the Roost Home Loan Affordability Report which has shown that the property market in New Zealand is picking up – in some areas.

‘Two speed housing market’ across New Zealand

The reports from Roost Home Loans, the mortgage broking group, found that there were signs of a ‘two speed’ housing market across New Zealand in March.  The New Zealand Herald reports that ‘higher priced properties in Auckland and some wealthier resort areas saw increased activity and prices, while provincial cities, Christchurch and the fringe areas of large cities experienced flat to falling prices.’

The report found that affordability of homes increased in March in 21 of 24 New Zealand regions and that first time buyer affordability also continued to improve to its best level in seven years.  Flat to lower prices for first time buyer homes and the mid-March mortgage rate cuts seen in the country combined to reduce mortgage repayments as a percentage of after-tax income.

Competition between banks also helping property in New Zealand

The New Zealand Herald also reported that there are ‘fresh signs that some banks have relaxed lending criteria and are offering discounts on legal and loan establishment fees.’

Rhonda Maxwell, spokeswoman for mortgage broking group Roost Home Loans, said: “The banks are competing harder than ever for business, which is improving the prospects for first home buyers in particular.

“The increased willingness of some banks to go the extra mile with fee discounts and interest rate reductions is encouraging some new home buying.”

The mortgage broking group found that some banks were now offering mortgages up to 90 and 95 per cent ‘loan to value’ and improving the discounts they were offering to borrowers.