Housing is a part of New Zealand that comes as a bit of a shock to most newcomers, as the materials that are commonly used to build houses in the country are very different from those used in Europe and North America. It is true that houses are built to very different financial limitations in New Zealand and the priorities of homeowners are not quite the same as of those in Europe or the US. Accepting these facts is the first step in understanding the nature of the New Zealand housing market, as you must realise that there may not be a property that will meet all of the needs you first decided upon before you knew what was available.
With this in mind, it is important to point out that this does not mean you should expect poor quality housing, poor workmanship or inferior materials; in fact, it just means that your budget might not go as far in New Zealand as it did in your native country due to the development of the housing market, demand and the evolution of the New Zealand economy.
House prices in New Zealand’s more desirable areas are constantly on the up, with average prices in some areas, such as the currently very fashionable Herne Bay suburb of Auckland, pushing up to $2 Million New Zealand Dollars. Currently, average house prices in Auckland in general are around $700,000 and are predicted to be averaging $1 Million NZD within the next 4 years due to a massive upsurge in sales prices.
In terms of nation-wide house prices, prices took a few years to stabilise after the 2007 property boom, but are now on the up again; by 4% since then and 7.1% over 2012 – 2013. This now means that the average house price in New Zealand is $430,000 NZD. This upsurge has been fuelled by a number of variables, not least of which being foreign investment, which, let’s face it, has been proven to be a very lucrative financial move.
What this means is that it had become very difficult for young native New Zealand adults to get a foot on the property ladder, something that the current government has tried to address. It seems, for the time being, they are achieving this, or at least working towards doing so, with the lowest mortgage rates seen in 50 years and rental rates also stabilising.
For new migrants moving here with some financial assets, it can mean that purchasing property in the country will take much more research, and, in turn, can also end up being a low risk but very beneficial short-term investment with potentially high realised gains. If you are on a tight budget, however, then it would be advisable to look for property within other not-so-highly desirable areas that are ‘on the up’, possibly even in one of the new housing developments that have been built in Manukau, Albany or Stonefields.