26 Jan 2022
Market Insight


ECONOMY - The Economy has continued to hold up well in the face of COVID-19 related problems. Even though small businesses have been struggling, the overall unemployment rate is at its lowest on record.

PROPERTY VALUES - With sales activity being slowed, property values have been gradually losing momentum too. However, the slowdown has been gradual, as lockdowns have continued to hamper listings and dampen buyers’ choices.

BUYER CLASSIFICATION - Mortgaged investors’ market share has remained relatively low, owing to higher deposit requirements and the phased removal of interest deductibility. First home buyers have been enjoying a little less competition for properties, but they now face mortgage restrictions too, with the low deposit lending speed recently halved.

MORTGAGES - Lending activity has been solid in recent months, but the prospects look more subdued, as borrowers face higher mortgage rates and also tighter lending rules.

CONSTRUCTION - New dwelling consents remain at record highs, reflecting smaller dwellings in Auckland. However, capacity pressures are now intense and costs are rising quickly – eventually, that will curb new-build demand as people focus more on buying existing dwellings.

OUTLOOK - The year ahead is likely to see a clearer slowdown for sales volumes, with property value growth also dropping back to low single digits. The factors ahead include poor affordability, higher mortgage rates, tighter credit conditions, increased listings, and a steady stream of new-build supply.

View the infographic here