Buyers are despairing of ever being able to find a property, according to the latest BNZ/REINZ survey of real estate agents.
BNZ chief economist Tony Alexander said the survey suggested that prices would continue to rise and the shortage in the market would only get worse.
A net 5.1% of the agents who responded to the survey reported a drop in vendor requests for appraisals, signalling that the shortage of listings in the Auckland market in particular is unlikely to improve any time soon.
Alexander said new building was still not keeping pace, either. “The number of consents issued for the construction of new dwellings was not only well below the 10-year average of 22,000 in March at 17,397, that result was down from February’s 17,481.”
Alexander said the Reserve Bank move to require banks to hold more capital for lending above 80% of a property’s value had made things harder for first-time buyers and had put a premium on high-LVR interest rates.
“Short of an outbreak of foot and mouth devastating the economy there appears little reason for believing other than that house prices will continue to rise strongly.”
A net 9.5% of the 549 people who responded to the survey this month said they had noticed more people going to open homes over the past month, a decline from April.
But Alexander said it did not appear that it was a lack of determination to buy that was prompting the easing.
Agents overwhelmingly reported that buyers were more motivated to get a deal done than sellers – a net 21.3% positive.
Alexander said: “This is the highest result in our two-year survey and well above the average of 4.7%. What this perhaps indicates then when taken in conjunction with the easing off in open home numbers and still high interest coming from investors and first home buyers, is that buyers may simply be sick of looking at homes they feel they have no hope of buying. One would not call this buyer fatigue but perhaps buyer despair.”
He said the survey showed that investors were still strong in the market.