It seems every week banks reduce the amount they think house prices will fall by. Now ASB are estimating a 5% fall while ANZ are now saying 5-10% (from 15% a few weeks ago).
I really don’t understand the point of their estimates. House prices are up 7% nationwide on last year already, and we are only half way through the year. If prices rise for the next couple of months and then miraculously fall by 5%, who is going to notice, or care?
With mortgage rates as low as 2.5% I can’t see why people would rush out and list their property for sale. About half of NZ homes owners don’t have a mortgage at all, and for those that do the 2.5% interest rate makes payments very low. I can’t see house prices falling outside the tourist centres of Queenstown and Rotorua and even there they probably won’t fall by much.
We are about to release some 2-bedroom townhouses on the Hamilton CBD fringe to our past buyers and priority list for $595,000 that will rent for $520-$540 per week. They will most likely sell out within a week. At current interest rates the rent will cover interest payments and expenses thereby allowing our investors to hold the property for eventual capital gain at no cost.
Now is as good a time to own investment property as ever.
John Kenel
Assured Property
#assuredproperty #housing #rentals #propertyinvestment
