From hunted to hunters

Investors have been hunted by policymakers, both from the last Government and the RBNZ. Interest rate deductibility, Brightline tests and laser focused LVR restrictions have all targeted investors. Precisely what was not needed with a chronic housing shortage. But now, the hunted will become the hunters, Jarrod Kerr, Kiwibank’s chief economist says. 

Hunters will seek opportunities in a ‘buyers’ market. Interest rates will play a big role. Rates are falling. “The RBNZ’s cut last week was the first in a 12-step walk back to neutral. The true test will come in spring, as the property market thaws out from a cold winter,” he says. 

Although the housing market has seen a sharp correction, and is still struggling to make ground, Kerr says Kiwibank is looking to next year, with rate cuts coming thick and fast.

“The RBNZ will take interest rates from very restrictive levels, to much less restrictive, and possibly stimulatory levels. Interest rates are the biggest driver of house prices.