All eyes in New Zealand will be on the Reserve Bank of New Zealand (RBNZ) this week and its latest announcement on the state of monetary policy.

Keith Niederer, Network Manager at NZ Raine & Horne, stated, "Although New Zealand’s official cash rate is widely believed to have reached its peak in this interest rate cycle, the RBNZ’s announcement on Wednesday will have significant implications for the real estate market in New Zealand as we approach the traditional spring selling season.

"It can be said that the central bank has effectively managed inflation, and that property owners have done a fair bit of the heavy lifting.

“However, it is encouraging to note that recent data from CoreLogic indicates that the average nationwide house value is still $183,000 higher than the pre-COVID level recorded in March 2020.

“We just need the RBNZ to do it’s bit on Wednesday and leave rates at 5.5% and allow buyers and sellers to take advantage of the expected early spring conditions in New Zealand.”

According to the National Institute of Water and Atmospheric Research’s outlook for July to September, temperatures in New Zealand are about equally likely to be near average or above average in all regions[i].

“We’re already seeing signs of daffodil bulbs which is a positive sign we’re headed for an early and warm spring, which might encourage vendors to list their homes for sales and buyers to get to open for inspections in larger numbers,” said Keith Niederer.

“The facts are that listings are down across the country, which presents vendors with an opportunity to get in early and find a buyer. We just need the RBNZ to leave the cash rate on hold.”

CoreLogic NZ Head of Research, Nick Goodall added, “Reduced supply, paired with high net migration, increased confidence, looser credit requirements (CCCFA and LVR) and near-peak mortgage interest rates, have supported demand and provided the setting for upcoming market change.”

If you’re looking to buy or sell a property, contact your local Raine & Horne estate agent today.