New data from Trade Me Property shows that now could be the time to buy, with prices having fallen slightly over winter, many listings to choose from and interest rates on their way down. Real estate experts agree, saying that market conditions point to a buyers market - but that buying conditions are likely to change in the next few months.

Figures from Trade Me Property show that average asking prices are around $50,000 less than at the beginning of the year and the lowest they’ve been in three years.

Signalling that now is a good time to buy, Trade Me Property Customer Director Gavin Lloyd says that if you’ve been waiting for a bargain, now could be the time to get in. “If it works for you and you have all your ducks in a row in terms of affordability, finance, and knowledge of the market, now could be the time to act.”

“Factors including price, volume of listings, and time to sell are all pointing to excellent conditions for buyers. Combined with anticipated lower interest rates and the traditional spring selling season, we’re likely to start seeing renewed momentum in the next few months.”

“Trade Me Property has the largest number of listings across all property sites in Aotearoa so our data provides a clear indication of what is happening in the market,” said Gavin Lloyd. The overall number of listings on Trade Me Property peaked in May to 42,440, the highest they have been in ten years.

Listings for properties on Trade Me Property priced at under $1m increased 27 per cent in the year to July 2024, and properties in the popular first home buyer range of $600k to $799k increased 29 per cent to over 11,000.

It’s also taking longer for houses to sell, with median days on Trade Me Property increasing from 73 to 75 in July.

“All of this adds up to more choice for buyers and more competition for sellers, putting downward pressures on prices,” says Gavin Lloyd. “Buyers have been taking more time to make decisions and have more negotiating power on price.”

Lloyd says that buying a property is one of the most important financial decisions many of us will make in our lifetimes, so it’s important to seek expert advice. “That’s where you can draw on a network of experts. Talk to your solicitor, mortgage broker or financial adviser, and speak to agents in your area.”

Daniel Coulson, Chief Executive of Ray White New Zealand says that right now is possibly the best time to buy than it has been in recent memory.

“When interest rates are rising, house prices generally fall or stagnate. But when they start falling, house prices begin increasing. Right now we’ve seen banks reduce mortgage rates with the expectation that the OCR will be cut before the end of the year.

“This means the buyer has a brief window where they can get the best of both worlds. They can buy at today’s price and lock in at tomorrow’s interest rate.”

“According to our mortgage broker partners, Loan Market, their buyers with pre-approvals are close to 40% higher than this time last year, so there’s a whole lot of pre-approved buyers waiting for the perfect conditions to buy,” says Coulson.

The bells are ringing that rates are on the slide and the way buyers can take advantage of this, is to act now, adds Bryan Thomson, Harcourts Managing Director.

“If you borrow today, you have every reason to expect that over the coming months and years, interest rates will trend down,” he says. If buyers are thinking, “I’ll wait til interest rates fall before I buy,” everyone else will be doing the same. For those buyers who get in now, there will be less competition,” he says.

“All the signs indicate, now is the time for buyers to be looking at transacting,” says Johnny Sinclair, National Sales Director Residential at Bayleys. The OCR hasn’t dropped yet but when it does the buyer wave will be coming in, he says.

“This is the quiet before the storm and the quiet is a buyer’s paradise – they get to choose properties and move on their own terms. As soon as a buyer is up against two or three buyers in an auction room, that quiet is over,” warns Sinclair.

In Wellington, where the housing market has suffered some of the biggest price drops in the country, Lowe & Co Managing Director, Craig Lowe was bullish about the opportunities for buyers. “It’s an incredible time to buy property in Wellington, the maths are clear. Wellington looks under-valued based on long term trends,” he says.

“When it comes to recession and job losses, people are blowing that out of proportion. We don’t have people selling their homes because they’ve lost their jobs. For buyers it’s more about the cost of money, access to credit and sentiment,” he says.

“At the moment it feels like we’re in the sideways market. Prices are neither up nor down, and 20% more houses have sold this year than last year,” adds Lowe.

His message: “Buy now and be patient, it might not come right for a while. You can’t wait for inflation beating gains to arrive before jumping in because you’ll miss out.”

When asked what advice he would give to buyers, Gavin Lloyd agrees a long term outlook is the best approach. The latest data from CoreLogic is that New Zealanders own their homes for an average of 11.1 years so buyers have plenty of time for their homes to appreciate in value over time.

“People who bought houses in the last two years will be feeling the pain of the value of their house dropping. But housing is a long term investment, the market is cyclical and values will eventually increase again over time,” says Lloyd.

Affordability is important for buyers too, as well as making the most of market intel from local real estate agents, he says.

“It’s a good idea to factor in affordability not just now but also if things change in the future. While we’re likely to see interest rates falling for later in 2024 if economists are to be believed and through 2025, there is always the chance of unexpected economic shocks in the future and no one can predict with certainty what will happen. Anything can happen at any time - as we’ve seen with Covid.

“Wise buyers and mortgage holders will keep up their higher repayments as rates decline, if they can, to pay off principal and reduce the terms of their loans.”

Sellers may need to adjust their expectations on price, suggests Lloyd. “With so many properties on the market, you’re no longer competing with one or two houses in your immediate neighbourhood, you could be competing with five or more.”

“Fiercer competition also means you may need to work harder for your property to stand out in a crowded market, and presentation of a property has never been more important. Make sure you fix all that stuff you’ve been meaning to get around to, be prepared to do a deep clean, declutter and remove all your old possessions and listen to your agent on what’s going to maximise attractiveness to buyers. Many agents have a network of tradespeople for odd jobs and some offer a spruce up evaluation service for your individual property. ”

For sellers, there’s never been more information in the media for them on what to expect, says Harcourts’ Bryan Thomson. “And if they’re looking to buy again, they might not get a premium price on their current property, but the next home they’re buying will be cheaper too. There’s never been a better time to trade up.”

Stars aligning for home buyers