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The RBNZ and most economic forecasters are predicting a weak recovery in consumer spending growth in 2010. The RBNZ’s view is based in part on the expectation that people will be wary of funding consumer spending from wealth increases associated with rising house prices and that banks will be less willing to facilitate people extracting equity from their homes.
Property prices in provincial and coastal areas will pick up in 2010, says the head of a national real estate company. Prices will firm as rural export revenues improve, interest rates remain low and demand returns for holiday baches and sections, says Harcourts CEO Bryan Thomson.
• The OCR remains on hold at 2.5%, inflation concerns opens door to earlier rate hikes in 2010. • RBNZ wary on increase in house prices, but subdued credit growth reassuring. • We continue to expect the RBNZ deliver at 50bp increase in April 2010.
House prices stayed static in the last two months and fears of more expensive mortgage money could be to blame. Real Estate Institute figures for November showed the national median remained at $355,000 in October and November.
House prices across New Zealand rose a slim 0.2 per cent in November, says the Real Estate Institute, but those in Auckland have soared nearly 12 per cent over the past year.
Property sales plunge in January
15 Feb 10
