It’s a great time to buy your first home in Auckland

Auckland Mortgage News | The Finance Marshall

No, this title is not the first half of a Tui billboard campaign! 

While it may seem unbelievable, the housing market in Auckland is showing more promise for first home buyers. It isn’t the impossible doom and gloom situation that the media are painting it as.

Times are changing and buying your first home could be more in reach than you initially thought.

Intrigued now?

Then read on to find out more about why we believe now is a great time to purchase your first home in Auckland...

Auckland Mortgage News | The Finance Marshall

Auckland HAS become more affordable

Recent figures from February 2019 show that the Auckland market is in fact moving in favour of buyers. According to Barfoot and Thompson, sales numbers have grown to the highest in 3 years, and interest rates have been reducing.

Just last week, it was reported that housing in Auckland is “once again affordable”. Imagine that! This came after a new report published by the Real Estate Institute of New Zealand (REINZ) found both interest rates and lower quartile house prices have made a significant drop.

The average two year fixed interest rate reduced from 4.33% to 4.25% between December and January. This is the second lowest rate since data was first collected in 2002 (the lowest rate was 4.23% in October last year).

The January lower quartile dwelling price was reported as $650k, which had come down from $675k in December. This brings the prices into the “affordable” range – the first time this has happened since June 2016.

Basically it means that you get more bang for your buck and you will have to pay less interest on it too! All of that adds up to more affordable housing if you are looking to get on the first rung of the property ladder.

Auckland Mortgage News | The Finance Marshall

Home lending restrictions have eased

The large chuck of money it takes for a first home deposit is the sticking point for many potential buyers. They are capable of making mortgage repayments, but the deposit is just too big of a hurdle to get over. The stock standard 20% deposit is hard to raise when you have rent and bills to pay.

The Government and The Reserve Bank have acknowledged that in recent years, getting a first home deposit together has been becoming less realistic. To address this, it was announced in late 2018 that The Reserve Bank was making changes to Loan-to-value (LVR) regulations.

What does that technical jargon mean?

Well, these changes will allow home loan vendors to lend 20% of new loans (previously 15%) to owner occupiers who have less than a 20% deposit. These updated regulations were implemented from January 1st 2019. That means that there is now more low deposit lending available to first home buyers. 

So, if you don’t quite have the 20% deposit you need, it is still worth getting in touch with the team here at Finance Marshall. As long as your other finances are in good shape, we can approach various lenders to see if they would consider your application.

Auckland Mortgage News | The Finance Marshall

There are still more changes to come

Predicting the behaviour of the property market is never straight forward. But, there are some further Government initiatives that could relieve more pressure from the Auckland area. This includes plans to remove the Auckland urban growth boundary and allowing for greater housing density. 

What is the urban growth boundary? It is a regional boundary set with the view to control the spread of urbanisation. Land within the boundary can be developed for housing. But land that falls outside it is either preserved or reserved for agriculture. Removing that boundary in Auckland would free up more land to build on. 

A Government spokesperson has said, "These policies are all designed to allow our cities to grow, while protecting the environment, instead of suppressing growth and driving up house prices."

Auckland Mortgage News | The Finance Marshall

So what does it all mean?

In short, it is good news for you if you are looking to purchase your first home. 

Are you wanting to buy your first property but aren’t sure where to start? Getting in touch with a home loan expert is your first step. The Finance Marshall can find you the best financial solution through our large network of lenders. 

We can take the stress out of a first home buying experience and best of all – our service is completely free. Contact The Finance Marshall today to begin your home-owning journey.


This product has been added to your cart