As we enter the fourth month of the of 2019 it’s interesting to look at some of the varying changes that have already happened to the market, some a direct result from changes made by the government,to, and others as a result of worldwide trends and changes.
Finance experts are currently predicting further cuts in interest rates to continue as The Reserve Bank of New Zealand is now widely expected to cut the Official Cash Rate at least once or even twice this year, after announcing in March to remain as is, it could change as early as May 8.
As we have mentioned before, banks have already moved to 3.99 percent as their main point for mortgage competition, which is a historic new low in the past decade. Some financial experts are predicting that we could see mortgage rates below dip even further, potentially reaching 3.5 percent by the end of the year, despite it being the 10th year of an economic expansion with unemployment near four percent.
This could be some welcomed good news for first home buyers, but as always it is a smart move to consult a financial expert before jumping into the market.
Commercial property has seen a big uptick in property this year, quickly becoming a viable alternative to residential property investments, proving to have better rental returns and in that outgoings such as rates and insurance are generally paid by the tenant. Property experts in Auckland have seen increased activity in the commercial property market, especially with newer locations being quickly built in the city center and outlining suburbs quickly being snapped up.
According to experts, in some cases there was more interest in property investors in new property than owner-occupiers. With major changes coming to residential investments and tenancy laws in the near future, it will be interesting to see if more investors move into this market.
Housing Minister Phil Twyford announced earlier in the year a batch of new requirements that are part of the Government’s healthy homes standards which include rules that will require every rental home in New Zealand to have a heater in the living room and an extractor fan in the kitchen and bathroom.
From mid-2021, all rental homes will be required by law to have a heater that can heat a main living area to 18C. Kitchens and bathrooms will have to have extraction fans or range hoods and, where rental homes have an enclosed subfloor space, property owners will need to install a ground moisture barrier to stop moisture rising into the home.
Twyford said the new rules were some of the “most important public health changes the Government could make”. This has followed years of complaints from renters who have suffered from damp/cold homes and inadequate heating sources.
As we head to a new quarter for 2019 it will be interesting to see how the market changes and adapts as more changes come into play.