NZ property market: Looking OK for now

New Zealand’s biggest property markets are in reasonable shape — prices are stable in Auckland, Dunedin’s are growing and Wellington has been recovering its losses since March. This is happening even while many banks will only lend to borrowers who can afford 7% interest rates. So how can the property market be looking this good while credit is tightening?

1. Auckland is trying to build away its housing shortage issues. And when housing is built, lots of businesses, professions and trades get a piece of the action. The wealth spreads across the economy, there’s even more economic fuel and the development train keeps chugging along… For now…

2. Unemployment just hit a super low 4.5%. So why does it matter if your graphic designer cousin finally has to get up at 7am like everyone else? Well, because a stronger jobs market means people are more cashed up, confident and secure. And this means more demand for housing. This helps keeps a floor under property values, i.e. no crash…yet.

While the RBNZ is feeling reassured, the Guvna’s fingers stay off the rates rise button. Not bad, eh? For now…