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NZ housing market slowing, nothing to scare the horses - BNZ

FXStreet (Bali) - Craig Ebert, Senior Economist at Bank of New Zealand, reviews today's NZ REINZ House Price Index (MoM), which came at 0.2% in September vs 1.1% prior, noting that while there is evidence of a slow, to slowing, housing market, it’s nothing too dramatic amid LVR restrictions.

Key Quotes

"The Real Estate Institute published its September results around midday. These were about as mixed as one would have expected, especially with the 20 September General Election in mind. While September’s residential sales were down 12% on a year ago this traverses a full 12 months of LVR restriction. And over the last few months sales have continued to stabilize on a seasonally adjusted, levels, basis. A severe lack of listings is also at play here (you can’t sell what’s not on the market)."

"Neither were prices particularly soft, although the 0.2% increase in the REINZ Stratified Index in September did slow its annual inflation further to 4.1%, from 4.8%."

"There is evidence of a slow, to slowing, housing market. However, it’s nothing to scare the horses – indeed could be argued as relatively robust in light of the LVR restrictions (which have cut many potential buyers out of the market) not to mention the build up to the 20 September election. We’ll reserve judgement on the housing market until we’ve seen a few months’ worth of post-election data and anecdote. We’ve heard a lot of stories about activity bouncing back."

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