New Zealand’s property market may be shifting from a buyer’s market to a seller’s market, driven by greater buyer demand – in particular from first home buyers taking advantage of favourable house price conditions – and lower-than-usual listings in what is traditionally the busy spring selling season.
Read on to find out more about the two important changes to market conditions that could see sellers regain the upper hand.
First home buyers leading the charge
One of the key driving forces behind a shift in the market is the influx of first home buyers. Slightly lower house prices and less competition has seen a greater number of individuals and families eager to take their first steps onto the property ladder, in what is considered by many to be the most favourable market conditions for first home buyers in recent years.
Across most markets in New Zealand, real estate agents – including those at Harcourts – are reporting
an increase in buyer activity at open homes and at auction.
The busy spring selling season is underway
Spring is traditionally a busy time for New Zealand’s property market, with a surge in listings matching an influx in buyers eager to find their dream homes. As the spring listing increase begins, the market offers a wider selection for buyers.
This, in turn, boosts confidence for sellers to list their properties for sale, knowing they will have more opportunities to secure their next home once their property is sold.
Bryan Thomson, Managing Director – Harcourts New Zealand said, “For this later part of 2023, month on month we have continued to see an upward lift in volume growth, signalling a positive trend.
While the increase is from a low starting point, all upturns have to start somewhere, and we are optimistic that the summer months will see a marked improvement in all growth aspects of the real estate market.”
Strategic approach for sellers
For those considering selling their property in this evolving market, there are several strategies that can be employed to optimise outcomes:
• Pricing wisely.
While demand is high, it’s important for sellers to set a competitive but realistic asking price for their property. This will attract serious buyers and maximise the potential for a quick sale.
• Showcasing the property’s unique features.
Highlighting the distinctive features of a property can make it stand out from the rest in a competitive market. Whether it’s a stunning view, a well-designed layout, or modern amenities, these aspects can sway buyers in your favour.
• Timely decision making.
With competition on the rise, acting promptly on offers and negotiations can be crucial. Sellers should be prepared to make decisions in a timely manner to keep the momentum going.
• Professional guidance.
Engaging the services of an experienced real estate agent can make all the difference when it comes to navigating this shifting market. They have the expertise to guide sellers through the process and negotiate on their behalf.
With the Reserve Bank of New Zealand holding the Official Cash Rate (OCR) at 5.5 per cent in October 2023, borrowers are having to get used to higher interest rates and mortgage repayments, as a drop in interest rates this year seems unlikely. For those deciding whether to refix or refinance their mortgage, or for those grappling with a higher cost of living, here are three strategies to help reduce the impact of higher interest rates on mortgage repayments.
1. Keep a money diary
With inflation around the 6 per cent mark, far outside the target range, the Reserve Bank of New Zealand (RBNZ) has been raising the OCR to bring demand back into balance with supply. By increasing interest rates, the RBNZ aims to encourage New Zealanders to spend less and save more, which will help to rein in inflation.
With interest rates remaining at high levels, at least for the foreseeable future, now’s the time to keep a close eye on spending, by tracking where your money is going and looking for areas to trim back on. Even the smallest amounts add up over time so it’s worth making this a priority.
To track spending, write down every purchase in a money diary, using your phone, a spreadsheet, or a written journal. Do this for at least a week but a month is preferable, as it forces you to think about how much you’re spending and what it is that you’re buying.
While it might sound like a bit of a bore having to write down everything you spend, doing this can help entrench good spending habits. After all, it’s easy to lose track of your spending, especially when using a credit card or buy now pay later facilities.
A money diary is the first step in getting control of your budget by planning future spending and making changes to spending habits.
2. Don’t stop investing
With more pressure on the budget from a rising cost of living and higher mortgage repayments, it’s tempting to shy away from investments. But maintaining investments or continuing to invest wisely can be a smart financial strategy and a viable means of boosting long-term returns.
Diversifying your investments across various assets could help balance the impact of rising interest rates on your overall financial situation. If you can afford to save, even a small amount, then explore your investment options by seeking investment advice from a financial adviser who is able to provide financial advice relating to investment products.
3. Use cash instead of cards
Remember the saying, “Cash is king”? Well, New Zealanders don’t appear to agree. A survey by the RBNZ found that nearly nine out of ten Kiwis prefer paying for things without using cash, opting for electronic bank transfers or bank cards instead.
But that could be about to change, and cash could make a comeback in the fight to beat overspending. Many Kiwis who struggle to understand the value of the dollar when not physically using cash, could find it easier to visualise where their money goes by drawing it out and paying cash instead.
Using cash is a great way to help prioritise paying important expenses first, because once the money is spent – it’s gone!
While no one can predict with absolute certainty what the remainder of 2023 will bring, cutting back on spending, saving more, and planning ahead will ensure you’re prepared no matter what comes your way.
Another way to save money is to ensure your home loan is structured efficiently, helping you repay your mortgage faster and get debt-free sooner. Talk to the team of Mortgage Express branded mortgage advisers today, and get advice about refinancing, refixing and home loan restructuring.
We are delighted to share that Harcourts has been honoured with the Reader’s Digest Quality Service Gold Award in Real Estate Agencies for the seventh consecutive year. This prestigious recognition is a result of your votes and trust in us.
At Harcourts, we understand that finding a real estate brand that meets your needs is crucial when it comes to buying, selling, or investing. We are grateful that you continue to choose us and give us your seal of approval.
“Despite the challenges of the past year, the support of the people of New Zealand have allowed us to earn this award once again”, says Bryan Thomson, Managing Director – Harcourts New Zealand.
“Our unwavering commitment to providing excellent service is at the heart of our success. Being recognised with the Reader’s Digest Gold Quality Service Award for seven consecutive years, along with the Reader’s Digest Most Trusted Award for 11 consecutive years, is a testament to the dedication of our team members across New Zealand. We take great pride in their outstanding contributions, as they continue to strive for excellence.”
The Reader’s Digest Quality Service awards are based on five important pillars: understanding, consistency, simplicity, satisfaction, and personalisation. To vote in a category, respondents had to have used a service provider in that industry. Market research agency, Catalyst, conducted a survey among 1,568 New Zealanders to determine the winners in various categories.
The feedback from our clients speaks for itself. They have described their experiences with Harcourts as amazing and an easy process from start to finish. One said, “I give Harcourts 10/10. They have been nothing short of amazing whilst renting through them”, with another saying, “It was an easy experience from start to finish – we bought and sold from the same team, and they were great.”
Reader’s Digest has confidence in the accuracy of the 2024 Quality Service survey results, which truly reflect the sentiment of New Zealand consumers.
Thank you for your continued support and trust in Harcourts. We remain committed to serving you with excellence and being at the forefront of the real estate industry.
Discrimination is unlawful under tenancy law when it breaches the Human Rights Act.
There are 13 Prohibited Grounds of Discrimination from Section 21 of the Human Rights Act 1993:
1. Sex, including pregnancy/childbirth
2. Marital Status
3. Religious Belief
4. Ethical Belief
7. Ethnic or National Origin
9. Age, although a tenant must be over 18 to sign a tenancy agreement
10. Political Opinion
11. Employment Status
12. Family Status
13. Sexual Orientation
When selecting a great tenant, we are looking for the best possible tenant based on merit and who is going to do two things.
1) Pay the rent on time,
2) Look after the property.
We also assess their application on other factors such as the number of people who reside at the property, the length of the tenancy, etc.
Does the colour of someone’s skin determine whether they will pay the rent and look after a property?
The Residential Tenancies Act makes it unlawful for anyone to discriminate:
• when deciding whether to grant a tenancy
• when deciding to continue or change an existing tenancy
• when deciding to end a tenancy.
You also can’t tell someone else to discriminate. For example, a landlord cannot instruct a property manager not to rent to a single parent, young people, people with children, or any of the other prohibited grounds for discrimination. Landlords can however say that they only want to rent to people with a proven rental history and references, and they can specify the maximum number of people allowed to reside at the property.
Can a landlord specify their ideal tenant?
Yes, a landlord can describe their ideal tenant, providing that description does not show an intention to discriminate. The Human Rights Act makes it unlawful to advertise in a way that shows an intention to discriminate against potential tenants on any of the protected grounds.
Landlords and property managers need to focus on their preferred qualities rather than on stereotypes. In an advertisement, they could say their ideal tenant is responsible, reliable and can provide references.
We must avoid using terms like ‘professional couple’, as it could be seen as an intention to discriminate against potential tenants because of their employment status or marital or family status.
Can landlords refuse to rent to or treat a person differently because they have a disability or a disability assist dog?
No, if someone has a disability, this must not factor into your decision making when deciding whether to grant them a tenancy, or you will be in breach of the Human Rights Act. Also, if they have a disability assist dog, a no pet policy either from the landlord or the body corporate is of no effect. Disability assist dogs are always ‘good boys’, and regardless, the tenant would be responsible for any damage the dog does.
Landlords and property managers should not make assumptions about whether a property is suitable for a person with a disability.
People with a disability should be allowed to make their own decision about whether accommodation is suitable for them, rather than a landlord or property manager ruling it out on their behalf.
Can a landlord refuse to rent to someone with children?
No, a property owner or their property manager cannot refuse to rent a property to someone because they have children. However, they can specify the maximum number of people who can live in the home, which will affect some families.
Under the Human Rights Act, it is against the law to treat tenants or potential tenants less fairly than others because of their family status, or any of the protected grounds.
If a landlord has had negative experiences with tenants with children in the past, that doesn’t mean they can rule out future tenants because of their family status.
Landlords and property managers should not make assumptions about whether a property is suitable for someone with children.
Applicants should be allowed to make their own decisions about whether a steep path or a busy road might be an issue for them, rather than a landlord or agent ruling them out.
What can a tenant or prospective tenant do if they think they have been discriminated against?
If a tenant feels that they have been discriminated against, they can take their complaint to the Human Rights Commission or the Tenancy Tribunal, but they cannot do both.
The second highest penalty on Schedule 1A of the Residential Tenancies Act 1986 is discrimination, with up to $6,500 in exemplary damages, payable to the other party.
There is a $350,000 limit on the money the Human Rights Tribunal may award. This is the same as the District Court
Summary – Section 12 of the Residential Tenancies Act 1986 – Discrimination to be an Unlawful Act
• Don’t discriminate and don’t tell anyone else to either
• Don’t state an intention that you are going to discriminate.
If a landlord was to instruct a property manager to discriminate on their behalf, they would commit an Unlawful Act under the Residential Tenancies Act 1986 and the Human Rights Act 1993, and if a property manager was to act on those instructions, they also commit an Unlawful Act.
The 13 prohibited grounds for discrimination have no bearing on whether a tenant will pay the rent on time and look after a property, and therefore should not, and must not, be considered when selecting a tenant.