Categorized | International

New Zealand Housing Market Showing Signs of Growth

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The residential real estate market is once again attracting the attention of investors, as yields show signs of positive growth. After a brief decline in the residential real estate market following the height of its last boom in 2006, New Zealand’s housing market is clearly back on the rise.

Yields across the country increased, with only seven of the thirty-eight markets not showing some form of substantial increase. Recent earthquakes that have hit the nation generally affected those that did not see an increase in yield.

The increase in yields, which indicates growth in the housing market, has been attributed to the rising rent costs. Property values have managed to remain roughly eight percent lower than rental rates.

The decline in mortgage rates has also contributed to increased yields in the residential real estate market. While the fixed-rate mortgage loans are not quite at the level of the United States, they are still roughly two to four percent lower in New Zealand now than they were five years ago.

For many potential homebuyers in New Zealand, the lower monthly interest rate on their mortgage makes all the difference, as it could cut as much as five hundred dollars off a typical monthly mortgage payment.

With residential real estate properties looking more and more attractive to investors, it is likely that the housing market could result in another boom, though perhaps even bigger than that which occurred five years ago. Housing prices may continue to rise, particularly with the low interest rates. The increase in housing values will simply be one more indication that New Zealand has found its way out of the global recession.

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About Nancy Raven

Nancy is the main writer for the International section of the website. Sometimes she also helps Drew out on the Finance/Mortgage section as well.

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