What is ahead for the Wellington property market?
We have had 3 solid years now of price increases. Most statistics show an average 40% growth in inner Wellington City since 2008. So, what are we predicting to come?
Well if we compare this time to last year and look closely at the last 4 months of 2018 there is a continuation of low stock within Wellington City, listings are sitting below 500 (population estimate of Wellington 496,000). Compared to Auckland City (population estimate of 1.37M) and Christchurch City (Population estimate of 381,000) having both just over 2300 listings.
Higher prices inevitably lead to higher mortgages, but Wellington continues to grow in popularity with increased inner city living and expanding workforce. Many innovative businesses are establishing and expanding.
In April, over 5000 permanent immigrants entered New Zealand, mostly into Auckland but also into Wellington and the provinces so DEMAND is forecast to stay strong. Many have concerns around interest rates and the World economy which may temper price increases as we have seen in Auckland but in the meantime for Wellington the difficulty in securing a property is likely to continue to drive a hot market albeit with the likelihood of lower increases in prices should interest rates go higher, banks restrict lending or immigration lowered.
Those homes in good condition in desirable locations are still seeing multiple offers and high unconditional sales. And those not cleared at Tender or Auction are requiring a bit more time, but majority are seen sold within the following 3 weeks.
We are entering new territory where mortgage rates continue at record lows, labour costs are continuing to climb, stock levels low and prospects of changed conditions being considered by buyers who are facing much higher mortgage repayments.
With no sign of rising stock a sellers market has a perception of continuing however we believe the market uncertainty will drive a more balanced market in the coming 12 months.
Written by Wellingtons #1 Team - APA