Poll shows ‘second wind’ in house price expectations

Property Institute Poll shows ‘second wind’ in house price expectations

Property Institute of New Zealand Chief Executive Ashley Church says the latest Institute-commissioned poll on house price expectations shows a big bounce in the number of people expecting house prices to rise.

According to the regular poll, the number of people expecting house prices to rise in the next six months has almost doubled and now sits at 34% - a big jump over the November figure of just 18%.

“If these figures flow through into house prices – we may be in for a second burst of house price inflation over the next few months as the much touted ‘second wind’ hits the kiwi property market”.

Mr Church says that property insiders often talk of a ‘second wind’ in houses prices which kicks in toward the end of a property cycle – but says that, to the extent that this can be measured, it is usually short lived. He also says that there is no evidence, yet, that renewed price confidence is spilling over into higher prices’

“We’re not yet seeing a jump in prices being paid – but the jump in confidence is definitely real and measurable”.

“There’s also a big drop in the number of people who expect house prices to decrease – down from 24%, in November, to just 12% now - a further indicator that the vast majority of people haven’t bought into the idea of a market correction”.

Mr Church notes that the number of people expecting prices to stay the same is virtually unchanged - up just 2%, to 48%, since November”.

Other findings from the poll

• People in smaller towns are most likely to expect house price rises (43%)
• Wellington is the most bullish of the main centres with 34% of people expecting house prices to rise in the next six months
• People in Christchurch are least likely to expect house price increases (20%) and 26% of Cantabrians are likely to pick a price decrease
• Aucklanders, by a majority of 54%, are most likely to think that property prices have stabilised.

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