Latest property report
The latest property news is brought to you by the New Zealand economics ANZ property focus.
Historically low mortgage interest rates, tight dwelling supply and booming net immigration continue to support the housing market, with lower trend consent issuance in Auckland and Wellington expected to maintain demand for existing dwellings.
Despite manageable debt serviceability, existing house prices remain stretched relative to both incomes and rents, particularly in Auckland and there is considerable scope for other centres to outperform.
Over the last month carded mortgage interest rates have fallen by less than the OCR cut, with higher bank funding costs partially offsetting lower wholesale interest rates.
Current borrowing costs are historically very low for the one and two year windows and continue to offer the best value. ''Our expectation of a further OCR cut over 2016 suggests that borrowers should opt for the one-year term. With OCR cuts on the cards and no OCR hikes until 2018 by our reckoning, longer-term rates don’t offer the same value at present.''
The economy looks in reasonable shape, with a number of supportive factors and we are forecasting 2½-3% growth over the coming three years. ''Our forecasts for the global economy depict a moderate growth backdrop overall.''