It won’t happen overnight
|The housing market continued to cool in April. However, we expect to see it picking up again through the back half of this year. That's thanks to the very low level of interest rates and the cancellation of the capital gains tax, both of which will boost purchasers' appetites.
April was another very weak month for the housing market. Sales fell another 2.6% over the month, leaving them 11% lower than the same time last year. We also saw annual house price inflation slowing to 1.3%, its slowest pace since 2011.
Looking under the hood, a lot of the weakness in the housing market continues to be centred on Auckland, with prices down 4% over the past year and sales at their lowest level in eight years. However, April also saw a cooling in other regions, bucking the recent trend of rapid price increases.
This weakness in prices was expected – we have been saying for some time that the sharp decline in house sales over the first three months of 2019 signalled weakness in prices further ahead.
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