NZ Housing: Foreign buyer ban starts to bite - Westpac
Dominick Stephens, chief economist at Westpac, explains that in the New Zealand housing market, the impact of the foreign buyer ban has really shone through in the latest market data covering December 2019 as the housing market turnover shot higher in October (just before the ban came into force), but has subsequently tanked.
“Based on our seasonal adjustment, and taking into account the fact that the Real Estate Institute initially understates the number of sales in a given month, house sales are now about 10% lower than they were a year ago. That’s roughly as low as they were during the slow housing market phases of early-2014 and early-2017.”
“The regional breakdown suggests that the foreign buyer ban’s fingerprints are all over this. The big drop in sales was concentrated Auckland, where seasonally adjusted sales dropped 20% in December, and to a lesser extent in Wellington and Christchurch. That matches where foreign buyers are most active (Queenstown Lakes has a high proportion of foreign buyers, but these are often Australians who are exempt from the ban).”