Latest news with #Corelogic
RNZ News
2 days ago
- Business
- RNZ News
How much is a bathroom really worth?
Living House bathroom. Photo: Supplied What's an extra bathroom worth in a house, really? If you're trying to get ready in the morning alongside your spouse and kids, you might think the answer is "quite a lot". Cotality, formerly Corelogic, data shows that people are willing to pay more for houses with multiple bathrooms. Head of research Nick Goodall looked at the value of three-bedroom houses compared to the value of three bedrooms houses with two bathrooms, when the characteristics such as floor size, land area and decade built, were otherwise similar. For a three-bedroom house built in the 2000s, people were willing to spend $39,000 more for a second bathroom in Waitakere, $62,000 more in Manukau, $65,000 more in Hamilton, $51,000 more in Tauranga and $59,000 more in Christchurch. "It may reflect the size of households in those areas, for example if household sizes are higher in Manukau, Hamilton and Christchurch then perhaps buyers value the extra bathroom there, more so than in Waitakere and to a lesser degree Tauranga." He said it became more common for newly built three-bedroom houses to have two bathrooms in the 2000s. "It shows that the ways households are formed these days, that requirement is more expected." Some people were adding bathrooms into houses that did not have more than one, he said. "There's that desire to have multiple bathrooms in a house even if you've only go three bedrooms. Anyone with kids will know… we personally added a bedroom and a bathroom. The bathroom is almost the most important because kids will share a bedroom, but when there are four or five people in a households that second bathroom is pretty important." He said the data seemed to indicate that it was worth spending the money to do. "If a buyer is likely to be willing to spend $40,000 to $60,000 more… that looks like the additional value. It's not a perfect analysis because there could be other factors but I suppose it provides some comfort that if you're spending $30,000 you're likely not over-capitalising and you will see that value returned to you as and when you sell." He said for property investors, an extra bathroom was probably more like to help a place rent rather than generate higher rent. "They might get more value from a bedroom, where you can increase the rent of the back of it." Property investor Steve Goodey said he found that extra bathrooms were a bonus. He said any home with more than two bedrooms should at least have an additional toilet. Real estate salesperson Brooke Gibson said having one bathroom would narrow the market for a property and could affect the price, but there would still be people who wanted to buy. "I'm a huge believer in you buy what you can afford and make it work." Sign up for Ngā Pitopito Kōrero , a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
RNZ News
4 days ago
- Business
- RNZ News
Stronger conditions for farmers may be helping regional property markets
Photo: RNZ Stronger conditions for farmers may be helping regional property markets. Stronger conditions for farmers may be helping regional property markets - and could pique property investors' interest, Cotality, formerly Corelogic, says. It has released its latest data, which shows, nationwide, values were down 0.2 percent in the month of July, 0.6 percent down in the quarter and 0.2 percent down year-on-year. Auckland remains 21.7 percent below its peak, Wellington 24.7 percent and Christchurch 4.7 percent. But there was a bit more resilience for values in provincial areas, which chief economist Kelvin Davidson said could reflect the two-speed nature of the New Zealand economy at present. Primary industries are generally faring better than the rest of the country. Gisborne experienced a drop in prices in July but Hastings, Whangarei and New Plymouth all rose by at least 0.5 percent. "It's early days and any perceived rural-urban divide in the property market at present should not be overplayed. After all, housing conditions are still fairly subdued almost everywhere. But a potential export-led recovery over the next year or two may well be a factor to watch in terms of boosting regional house prices relative to urban areas." Davidson said proportionally more of the regional markets had seen growth in values compared to the main centres. "Nowhere is booming so it's a relative story but if you look at the so-called regional markets, the provincial centres, there's probably a slightly more common story around a bit more growth." He said the export-led recovery could mean "cash coming off farms" and going into service towns and cities. "The longer the export-led recovery continues, the greater the chance you see outperformance in the regional markets." He said property investors might notice the trend and decide to look at areas such as Invercargill and New Plymouth. "If there's a bit more capital growth it might be a place to think about investing … I'm not making investment recommendations and keep in mind there's always risk on the other side. If you're looking at a high-level measure like gross rental yield or the possibility the markets deliver a bit more value growth, it doesn't tell the full story. There are other costs associated and things to weigh up on both sides." Infometrics chief forecaster Gareth Kiernan said the South Island's property market was generally stronger than the North Island's. "Parts of the South Island in particular seem to be performing better in terms of sales levels and stock numbers, it's not quite as over-supplied but Auckland and Wellington are struggling." He said the country was facing an "old-fashioned" economic recovery, driven by the export sector rather than migration and housing radiating out of Auckland. "I'm not sure whether the regional housing markets get dragged along with that agricultural upturn." He said some centres did not seem to have had the population growth to justify the number of houses built at the peak of the building boom. That might put investors off. "An oversupply issue in some regions persists … I'm positive about Christchurch and Queenstown and I guess some of those smaller regional centres have the benefit of being tied into the dairy sector, the rental yields are bit better than you get in Auckland. "If there's a better rental yield and potentially better expectation of capital gains that might be preferable [to main centres]. But it does depend on people's expectation of what prices will do and there's still a lot of uncertainty around it. Consenting numbers are still relatively high compared to population growth." Davidson said the second half of August was usually when there was an increase in the number of listings on the market. "Sales volumes have been gradually growing to the point where the level of sales is back to about normal and we are starting to see hints that the total stock of listings is starting to come down, although it's coming off a multi-year high … it will be interesting to see how it plays out in spring." Some properties were being removed from the market because owners had decided not to sell , he said. Davidson said he was cautious about what might be ahead through the rest of the year. "This is market that's going sideways. Sales are rising but it's not flowing through to prices. There are restraining forces on the other side - abundant listings, a weak economy and labour market. "Both buyers and sellers seemingly remain in a measured mood. First home buyers and 'Mum and Dad' investors are active groups on the purchaser side of the equation at present, but it's also worth noting that many vendors aren't rushed at present either - those who are confident about their employment security may well be happy to wait for the price they want." He said while it had previously been expected that house prices might lift 5 percent this year, it now seemed the lift would be smaller than that. "In fact, on recent form, the market may struggle to generate much more than a 1 percent or 2 percent rise in 2025." Sign up for Ngā Pitopito Kōrero , a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
RNZ News
21-05-2025
- Business
- RNZ News
First-home buyers are getting into market with less savings, data shows
Banks can lend 20 percent of their new lending to owner-occupiers with less than 20 percent deposit or equity. Photo: Unsplash/ Artful Homes Forget saving a 20 percent deposit - large numbers of first-home buyers are getting into the market with much smaller levels of savings. Cotality, formerly Corelogic, has released its latest data, which includes Reserve Bank figures showing that 44 percent of all first-home buyers had less than a 20 percent deposit in March and first-home buyers were responsible for 78 percent of all low-deposit borrowing by owner-occupiers. Banks can lend 20 percent of their new lending to owner-occupiers with less than 20 percent deposit or equity. Reserve Bank data shows that in March there was $947m of lending to borrowers in that position, just $24m of which was to investors. That's a significant increase from March 2023, when there was just $510m in lending to borrowers with less than 20 percent, and last March, when there was $584m. "First-home buyers basically have the monopoly on low-deposit lending allowances at banks," Corelogic property economist Kelvin Davidson said. "Owner-occupiers further up the ladder may not need low-deposit finance as much so that's part of it, but I also think to some extent that the banks have been sort of reserving those speed limits for first-time buyers. "For quite a while now we've seen about 75 percent or 80 percent of all low-deposit lending to owner-occupiers in general has been to first-home buyers. "About two in every five first-home buyers, or even a bit more than that, are entering with a low deposit." Corelogic property economist Kelvin Davidson. Photo: SUPPLIED He said some buyers might not even be aware it was an option. "Some people might be out there thinking 'gee I don't have the required 20 percent so I can't buy a house', but actually there are allowances there and a lot of it goes to first-home buyers. "I think if you want to get into the market with a reduced deposit there probably is capacity - the speed limits overall aren't really being tested. "The speed limit there is 20 percent [of new lending] but only about 12 percent is going out at low deposit… then other tests come into it." He said KiwiSaver was also helping. In April, 3970 people withdrew their KiwiSaver funds for a first-home purchase, up from 3320 in April 2024, with a total of $167.3m withdrawn. Mortgage adviser Glen McLeod, head of Link Advisory, said borrowers with less than a 20 percent deposit were able to access interest rates from about 4.99 percent to 5.59 percent. "Those who qualify for a Kāinga Ora First Home Loan can access these same rates with as little as a 5 percent deposit, though a 0.50 percent fee applies. "When the deposit is under 20 percent, most lenders apply a low equity margin, which is typically tiered based on the loan-to-value ratio. "These margins vary by lender, but we're starting to see some shift in the market - one major bank has recently removed these margins altogether, offering a standard rate and a discounted rate for borrowers with more than 20 percent equity." He said it was noticeable that more applications were including income from boarders. "Whether it's friends helping with mortgage payments or adult children moving back home, many buyers are looking for ways to improve affordability. "In some cases, income from secondary dwellings or granny flats is also factored in, where accepted. It's a reflection of how people are adapting to meet lending criteria in a challenging environment." Adviser with Loan Market Karen Tatterson said a first-home buyer with ASB who had a 10 percent deposit would pay the advertised interest rate plus a 0.75 low-equity margin. "As an example, their one-year rate would be 5.7 percent. "ANZ, who do not charge a low-equity margin, apply their standard rate so for first-home buyer at 90 percent, their one-year rate would be 5.59 percent." She said all the banks were also offering $5000 cash contribution for a first-home buyer. Overall, Davidson said the market continued to steadily become more active. Sales were up 4 percent compared to a year earlier in April, taking activity to 7 percent above the historical normal for this time of year. "Sales activity has been on a steady incline, and we're now starting to see this translate into home values," Davidson said. The Cotality Home Value Index rose 0.3 percent in April - the fourth consecutive monthly increase - although growth remains modest. Among the main centres, Hamilton and Christchurch led the gains, while Dunedin, Wellington and Tauranga showed flatter results. "Despite these signs of improvement, the market remains tilted in favour of buyers," Davidson noted. He said the outlook for the rest of the year was for moderately increasing prices and activity. "We're expecting a moderate upswing, with national property values forecast to rise around 5 percent for the year," he said. "Lower mortgage rates will be a key driver. But we're also watching the wider economy, the labour market, and the impact of lending restrictions, particularly debt-to-income limits." Sign up for Ngā Pitopito Kōrero , a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
Scoop
17-05-2025
- Business
- Scoop
Is It Actually A Good Time To Buy A House?
Twice this week, first-home buyers have been told it might be their big chance to get into the market. , Money Correspondent Twice this week, first-home buyers have been told that now might be their big chance to get into the housing market. First, QV said a lull in property values was giving first-time buyers a 'rare opportunity'. Then, the Real Estate Institute acting chief executive Rowan Dixon suggested that, if first-home buyers were looking for a chance to get into the property market, it was a good time to do so. 'There is still plenty of stock there, particularly in the main centres, good pricing and low interest rates… if people can get into the market for their first home now is a good time to do it before maybe things start to pick up a bit more.' But just how great an opportunity is it, really? RNZ looked at a number of factors that could help answer that question. Interest rates Interest rates have fallen significantly, which helps to make the prospect of servicing a mortgage a bit more palatable. From a peak of about 7 percent, two-year home loan fixes are now about 5 percent. That means, for a typical first home mortgage of $567,448, the weekly repayment would be about $700. That's still about $60 more than the national average rental rate. Usually, falling interest rates push up house prices but that hasn't happened to a significant degree yet. 'There's a window where financing is cheaper but it hasn't quite flowed through to house prices as it might have done historically,' Corelogic chief property economist Kelvin Davidson said. Brad Olsen, chief executive at Infometrics, said rates were not expected to get back to the 2 percent levels seen through the Covid times. 'Interest rates are down but to more usual long-term levels.' House prices Nationally, house prices are still down about 15 percent from the peak, although they are still up 4 percent a year compared to five years ago. Wellington's prices are furthest from the peak, still down more than 25 percent, Auckland's are down 21.6 percent. But all prices are still higher than five years ago. Earlier data from Corelogic showed they were the areas that had the largest affordability improvements, bringing them close to long-term averages. Places like Queenstown and Christchurch are a bit of an outlier – Canterbury is now just 3.2 percent below the peak and Southland has already exceeded it 'Houses are more affordable than they were,' Davidson said. 'I still wouldn't say they are affordable as such – they're cheaper, but not necessarily cheap. But are house prices really going to fall significantly further from here? It seems unlikely. They'll probably turn around and rise a bit. There's a sense now that they're as cheap as they're going to be even if they're not necessarily cheap.' KiwiSaver Some buyers' KiwiSaver accounts may have taken a hit through the start of this year due to market volatility. Most of those could have shown signs of recovery over the past week. Davidson said it was likely that people who were planning to buy in the near term had already shifted their money to conservative funds before the wobbles hit. Stock on the market Buyers have a lot of choice at the moment, which gives them the upper hand. In a buyers' market, they can take their time over their decisions and know they have a lot of options. says the amount of stock for sale was up 6.2 percent year-on-year in April. Olsen said that meant buyers could bargain for a lower price and play sellers off against each other. 'If you want to get a sale and a possible buyer knows there is probably another house for sale down the road you'll be doing a fair bit to make sure your house gets sold.' Rent But it's actually a good time to be a renter, too. There is also a lot of rental stock on the market in lots of parts of the country, and advertised rents are dropping. The picture isn't consistent across the entire country but it's taking longer than normal to rent in most places with the exception of parts of Canterbury and Hawke's Bay. 'You could make a case of why rush into it when you could get a good deal on a rental for a while and you're probably not going to get left behind by the housing market in the meantime,' Davidson said. 'In general terms renting is always cheaper than buying so nothing has really changed there… if you stuck to that line of argument no one would ever buy a house.' The job market Buying a house usually means you need to have reliable income. While the worst might be nearly over for the labour market, it's likely to be weak for a while to come, which could mean job losses are more likely and it could be harder to find a new job if you are unemployed. Anyone who is worried about their job security might hesitate about buying a house. 'They might be able to afford the house at the moment but not if they lost their job and couldn't find a new one,' Olsen said. The other stuff Davidson said you could argue that it's 'always a good time to be a first-home buyer'. 'In the sense that if you want to buy a house, like the house, like the location, you're secure in your job and you want security of tenure and you can secure the finance, you're going to be there for the long-term why wait?' He said for many first-home buyers the decision was more than financial. 'They're setting up a family base.' He said if people looked for negatives they would probably never do anything. 'There are always pros and cons but if we're asking a binary question, is it a good time to buy, yes or no, I would have to say yes.' Olsen said he was always worried when people said buyers should 'rush in'. 'It comes across as scarcity marketing to scare people into rushing into buying. Buyers definitely have a good opportunity at the moment, that is true. But I think they should keep their wits about them, look at what's out there and how much they can afford, run some scenarios on what they could afford if things changed around mortgage rates or their job.'
Scoop
17-05-2025
- Business
- Scoop
Is It Actually A Good Time To Buy A House?
Article – RNZ Twice this week, first-home buyers have been told it might be their big chance to get into the market. , Money Correspondent Twice this week, first-home buyers have been told that now might be their big chance to get into the housing market. First, QV said a lull in property values was giving first-time buyers a 'rare opportunity'. Then, the Real Estate Institute acting chief executive Rowan Dixon suggested that, if first-home buyers were looking for a chance to get into the property market, it was a good time to do so. 'There is still plenty of stock there, particularly in the main centres, good pricing and low interest rates… if people can get into the market for their first home now is a good time to do it before maybe things start to pick up a bit more.' But just how great an opportunity is it, really? RNZ looked at a number of factors that could help answer that question. Interest rates Interest rates have fallen significantly, which helps to make the prospect of servicing a mortgage a bit more palatable. From a peak of about 7 percent, two-year home loan fixes are now about 5 percent. That means, for a typical first home mortgage of $567,448, the weekly repayment would be about $700. That's still about $60 more than the national average rental rate. Usually, falling interest rates push up house prices but that hasn't happened to a significant degree yet. 'There's a window where financing is cheaper but it hasn't quite flowed through to house prices as it might have done historically,' Corelogic chief property economist Kelvin Davidson said. Brad Olsen, chief executive at Infometrics, said rates were not expected to get back to the 2 percent levels seen through the Covid times. 'Interest rates are down but to more usual long-term levels.' House prices Nationally, house prices are still down about 15 percent from the peak, although they are still up 4 percent a year compared to five years ago. Wellington's prices are furthest from the peak, still down more than 25 percent, Auckland's are down 21.6 percent. But all prices are still higher than five years ago. Earlier data from Corelogic showed they were the areas that had the largest affordability improvements, bringing them close to long-term averages. Places like Queenstown and Christchurch are a bit of an outlier – Canterbury is now just 3.2 percent below the peak and Southland has already exceeded it 'Houses are more affordable than they were,' Davidson said. 'I still wouldn't say they are affordable as such – they're cheaper, but not necessarily cheap. But are house prices really going to fall significantly further from here? It seems unlikely. They'll probably turn around and rise a bit. There's a sense now that they're as cheap as they're going to be even if they're not necessarily cheap.' KiwiSaver Some buyers' KiwiSaver accounts may have taken a hit through the start of this year due to market volatility. Most of those could have shown signs of recovery over the past week. Davidson said it was likely that people who were planning to buy in the near term had already shifted their money to conservative funds before the wobbles hit. Stock on the market Buyers have a lot of choice at the moment, which gives them the upper hand. In a buyers' market, they can take their time over their decisions and know they have a lot of options. says the amount of stock for sale was up 6.2 percent year-on-year in April. Olsen said that meant buyers could bargain for a lower price and play sellers off against each other. 'If you want to get a sale and a possible buyer knows there is probably another house for sale down the road you'll be doing a fair bit to make sure your house gets sold.' Rent But it's actually a good time to be a renter, too. There is also a lot of rental stock on the market in lots of parts of the country, and advertised rents are dropping. The picture isn't consistent across the entire country but it's taking longer than normal to rent in most places with the exception of parts of Canterbury and Hawke's Bay. 'You could make a case of why rush into it when you could get a good deal on a rental for a while and you're probably not going to get left behind by the housing market in the meantime,' Davidson said. 'In general terms renting is always cheaper than buying so nothing has really changed there… if you stuck to that line of argument no one would ever buy a house.' The job market Buying a house usually means you need to have reliable income. While the worst might be nearly over for the labour market, it's likely to be weak for a while to come, which could mean job losses are more likely and it could be harder to find a new job if you are unemployed. Anyone who is worried about their job security might hesitate about buying a house. 'They might be able to afford the house at the moment but not if they lost their job and couldn't find a new one,' Olsen said. The other stuff Davidson said you could argue that it's 'always a good time to be a first-home buyer'. 'In the sense that if you want to buy a house, like the house, like the location, you're secure in your job and you want security of tenure and you can secure the finance, you're going to be there for the long-term why wait?' He said for many first-home buyers the decision was more than financial. 'They're setting up a family base.' He said if people looked for negatives they would probably never do anything. 'There are always pros and cons but if we're asking a binary question, is it a good time to buy, yes or no, I would have to say yes.' Olsen said he was always worried when people said buyers should 'rush in'. 'It comes across as scarcity marketing to scare people into rushing into buying. Buyers definitely have a good opportunity at the moment, that is true. But I think they should keep their wits about them, look at what's out there and how much they can afford, run some scenarios on what they could afford if things changed around mortgage rates or their job.'
