New Zealand is currently experiencing a suppressed housing market due to Covid-19.
Lodge Real Estate Managing Director, Jeremy O’Rourke, says New Zealand has been working in a false market with borders being closed and people operating in a semi-lockdown state as the Omicron outbreak continues. However, he and others believe this is set to change soon.
A Hamilton real estate agent says house prices, alongside demand, could reignite as borders reopen. He says that those locked out due to previous MIQ restrictions will be returning now that quarantine rules have softened.
Woman walking past the MIQ barriers outside the Grand Mercure Hotel in Britomart, Auckland, New Zealand, on 29 October 2020.
As well as this, O'Rourke believes New Zealanders will be wanting to return home with context to the war between Russia and Ukraine.
"As our borders reopen and tensions increase between Russia and the Ukraine, New Zealanders will be looking to return to safety. Citizens and residents will travel back to New Zealand to reconnect with family, and they will all need somewhere to live," says O'Rourke.
"We saw Kiwis return en masse after major global crises like 9/11 and the global financial crisis, so we believe the Ukrainian conflict may trigger an Antipodean population shift once again."
Some economists have predicted a long-term slump in the market on the back of high inflation, rising interest rates, and changes to bank lending rules. QV’s February report found home values fell in Hamilton for the second month in a row, down 0.4 percent in February.
But O’Rourke says some dire predictions made by economists are misguided and haphazard, because the market is artificially suppressed.
House for sale in Auckland, New Zealand.
Around 5000 international students were tipped to return to New Zealand once borders reopened. Around ten percent of those will move to Hamilton. There are only 80 rentals currently available in the city and with 50 percent of those being small studios the impending student influx posed a real challenge, he says.
“We expect the second half of the year will see a renewed vigour from investors as simple supply and demand pressures caused rents to rise, making rental property investments very attractive,” says O’Rourke.
Throughout February there had still been multiple offers made on many quality Hamilton homes, although foot traffic at open homes had been down because of increasing Omicron cases.
