It may seem hard to imagine that the home you’re in today – whether it’s your starter home or just one you’ve fallen in love with along the way – might not be your forever home.
Many needs have changed in 2020, and it’s okay to admit if your house no longer fits your lifestyle.
If you’re now working remotely, trying to exercise at home, or simply just spending more time in your own four walls, you may be bursting at the seams in your current house.
Prices have appreciated 13% year-over-year in the Whangarei region.
At the same time, our overall inventory (houses for sale) has dropped from one year ago.
These two statistics are directly related to one another. As inventory has decreased and demand has increased, prices have been driven up.
This is great news if you own a home and you’re thinking about selling. The equity in your house has likely risen as prices have increased. Even better is the fact that there’s a large pool of buyers out there searching for their next property, and your home may be high on their wish list.
If you think you’ve outgrown your current home, reach out to me to discuss local market conditions and determine if now is the best time for you to sell.
Experts say national house prices could rise by as much as 13 to 16 per cent in the next few months.
That number seems crazy, but in the past 12 months the Whangarei area median house price grew by 13% year-on-year.
Will we see the same again this year? It’s a great time to sell then, but what about to buy?
Read on for my take on it...
Economists at Westpac, ASB, BNZ and Kiwibank say low interest rates and high demand will continue to have an impact in the new year.
The economists' predictions vary, but they agree that 2021's housing market will build on records set last year.
These predictions come despite the Reserve Bank's scheduled introduction of tougher lending rules for investors in March.
Westpac chief economist Dominick Stephens said house price inflation had a way to run yet and he's picking big growth this year.
"We are forecasting a peak of 16 per cent annual house price inflation in June 2021, and a full-year increase over 2021 of 12.2 per cent," he said.
"House prices are being driven higher by low interest rates, and interest rates are set to stay low or fall further over the coming year. Meanwhile, other factors such as net migration and the economy are going to improve. So our models point to ongoing rapid house price increases."
This prediction is on par with ASB senior economist Mike Jones and BNZ's Stephen Toplis, who forecast double-digit growth by the end of the year.
Kiwibank's chief economist Jarod Kerr was the most conservative among the major banks, tipping more modest 5 to 6 per cent growth later next year when lending restrictions bite.
While all of that is based on solid data, it is just speculation, here is what we do know…
Housing is based on the simple formula of supply and demand. So for now, and continuing on from the last few months especially - there is far greater demand for houses than what is available, and that is pushing the prices up.
If everybody had a house they wanted to live in, and a couple of investment properties, then the demand would be far less, resulting in lower or at least stable house prices.
The big issue after our COVID restrictions appears to be the number of Kiwis wanting to return home, along with people looking to move out of the larger cities - Auckland in particular, and move to the smaller towns and provinces. Whangarei is high on buyers list as we are located only 2 hours from Auckland, the climate is good, and the beaches and outdoor activities are truly world class - all of it not being too crowded, for now...
On all of the properties that I sold in the past 6 months, I had calls with people from Auckland that were firming up their future plans. A lot of them are now retiring 5-10 years early, cashing up and looking to make a permanent move to places where they have enjoyed holidaying or have family already living.
The other big issue that I talk to a lot of people is - “we know that we will get a great price if we sell, but then we are buying in the same hot market, why would we do that?”
While this is totally correct, the thing to look at is the historically low interest rates.
So, it is actually a very good time to sell your current house, and upgrade to a home that better suits your needs. The overall ‘cost’ of borrowing money has never been cheaper.
It may be that you now need a dedicated home office, bigger garage for cars along with a home gym setup, or, just more space for the family to be a family if we have any more restrictions around movement in our future.
I had friends in Auckland that had to endure Level 4 lockdown in a small central city apartment, while we were able to do it in a house big enough for all of us to have our own space, as well as room for the kids to jump on the trampoline, and ride their bikes up and down the driveway.
To put it out there, I agree with the ‘experts’ that we will see house prices continue to rise for the first part of this year. To grow another 13 - 16% after we’ve just had a year of 13% growth seems a bit much, but the thing is, none of us know how much demand buyers that want to secure properties will put on the market.
I’m here to talk more around your property selling plans, and help you take advantage of the current situation anytime you’d like to. Get in touch here, or just call me on 021 606460.
Helpful and interesting info from Paul, and Harcourts to help you with your property journey.