This winter young Kiwis will have the best opportunity to get on the housing ladder in more than a decade, says Derryn
Mayne, Owner of Century 21 New Zealand.
“Rents may have been frozen and there’s more choice for tenants with the likes of many Airbnbs now long-term rentals.
However, rents are likely to stay relatively high when compared to the falling cost of servicing a mortgage for those
renters living outside our international tourism destinations or downtown Auckland,” says Ms Mayne.
With many interest rates now well below three percent, and with the Reserve Bank scrapping its mortgage loan-to-value
ratio (LVR) restrictions, lower deposits are now required to secure a mortgage and ongoing repayments have never been
cheaper.
“Banks will still be tough when assessing loan applications and people’s ongoing ability to service a mortgage, but when
all this starts settling down and property valuations become clearer, you’ll see banks more willing to take on new
lending,” she says.
The Century 21 boss says prospective first-home buyers with good job security or a couple who are both working, should
seriously consider this winter as a good time to take the home ownership plunge.
“Next-home buyers have a natural inclination to market their homes in summer. However, the season is irrelevant for
first-home buyers, and both buyers and vendors should now seriously consider that fact. First-home buyers don’t have to
worry about selling their property first, they can secure pre-approval for a loan, then buy. It’s a powerful
proposition.”
She says this winter may also prove a prudent time for first-home buyers to purchase, as house prices might rebound
sooner than expected.
“Commentators agree that real estate will take some kind a hit, but equally there’s debate on how far away the recovery
is. Also, different parts of the country will be impacted differently.
“Rental incomes and property values are vulnerable in areas like those heavily dependent on international tourism or
foreign students. In saying that, if domestic tourism rallies, an Australasian travel bubble is opened, and our export
education sector is salvaged, then the likes of downtown Auckland and Queenstown may fare better than anticipated,” she
says.
Derryn Mayne says as well as strong first-home buyer interest, Century 21 salespeople are reporting plenty of next-home
buyers, eyeing a bigger or better home, and keen to take advantage of record low interest rates and vendors increasingly
willing to negotiate.