First home buyers hit a record-high share of the property market in December, new data has revealed.
People purchasing their first property made up 27 percent of buyers in December, and also for the entire quarter (Q4), says CoreLogic.
That's higher than the record in 2021 when they made up 23.1 percent of the market.
Kelvin Davidson, chief property economist at CoreLogic, said first home buyers had a good 2023.
"This is the first time FHBs have ever out bought other buyer groups."
That could be due to a number of things, Davidson said, including access to KiwiSaver, loan-to-value restrictions (LVR), compromising on the property, or less competition from investors.
Property investors with mortgages had a "quiet 2023", making up about 21 percent of activity. That marks their lowest activity in the market since 2005.
However, property investors who don't have mortgages accounted for a 13 percent share - which not too far off a record high.
Owner-occupiers moving house were also "relatively quiet" in Q4, Davidson said, making up 25 percent of activity.
Owner-occupiers relocating normally account for the largest part of the market.
Davidson said LVR restrictions and high interest rates were dampening speculation by property investors at the moment, but added "their market share has just started to edge higher in the past month or two".
Residential property prices are likely to continue rising in 2024, but may be "underwhelming", he said.
"As property tax changes kick in with deductibility restored to 80 percent from April 1, it will be interesting to see how investors' demand responds."
Te Pūtea Matua / Reserve Bank announced this week it will soon overhaul the rules for retail banks' mortgage lending. It plans to bring in debt-to-income (DTI) ratios, and at the same time ease LVR restrictions to reduce the risk to the economy from property.
DTI rules restrict how much debt borrowers can take on, relative to how much they earn.
The residential property market is now worth NZ$1.59 trillion.
Prices
Nationwide, prices rose 1 percent in December - the third increase in a row.
The main centres have been recording larger increases than smaller ones, with a few exceptions like Queenstown.
Sales
Property sales were 28 percent higher in December 2023 versus a year earlier.
That figure accounts for private deals and real estate agents.
Annually, there were 66,000 homes sold last year, which was well below the average of 92,500 homes.
Listings
Davidson said new home listings picked up again after the summer holiday period.
There were 3100 new home listings in the four weeks to January 14, which is below the five-year average of about 4000 homes.
In terms of total home listings, there were just under 32,000 on the market.
Rents
Rents have risen 7.0 percent in the year to December, above the long-term average of 3.2 percent.
It's running at "historically high levels," said Davidson, which reflects less supply, and more demand.
In October, Barfoot & Thomspon said record-high net migration was having a major impact on rents.
Annual net migration to Aotearoa hit a record high of more than 128,000 people in December.
