Competition between investors and first home buyers about to heat up

Mortgage adviser Kris Pedersen of Kris Pedersen Mortgages says investors are ignoring new builds and targeting multi-income existing properties.

This is backed up by Trade Me’s latest data showing in the July year, searches with keywords “income” rose 6.3%, “home and income” searches rose 10.6%, searches with “rental” in them were up 12.3% and those for “yield” were up 8.9%. Low numbers of searches for “investment property” were up 41%.

It comes at a time when property values across the country dropped to $805,984 last month. This is the eighth month in a row values have dropped to be about 18% below the post-Covid cyclical peak, but still 16% higher than the pre-Covid level of March 2020.

However, CoreLogic's hedonic Home Value Index’s (HVI) 0.5% pace of decline last month has roughly halved in the past couple of months after an average fall of about 0.9% from May to August.