In fact, first-home buyers’ share of the market is on par with the peaks showing before the global financial crisis of 2007-8, says CoreLogic research analyst Kelvin Davidson.

“For first-home buyers, the rise to 24 per cent of the market in quarter three continues the upwards trend that began back in early 2014.

“It’s also the first time that they have matched mortgaged multiple property owners.”

Multiple property owners are people with more than one property and are often investors, own holiday homes, or own accommodation for student children.

Around the main centres, key first-home buyer markets are currently Christchurch and Wellington, Davidson says in the latest report.

“For New Zealand as a whole, it’ll be really interesting to see if first-home buyers can push ahead of mortgaged multiple property owners next quarter.”

He speculates that these numbers are driven by first-timers’ access to KiwiSaver savings and a move away from renting.

“Often renting can be more expensive than a mortgage repayment, provided that the deposit hurdle can be cleared.”

The percentage is growing, however, the numbers are still less than pre-GFC purchases. The number of first-home purchases in late 2006 and early 2007 was 11-12,000 a quarter. In quarter three this year, it was less than 7,000.

Investors are still big buyers, despite extra regulations putting pressure on them, says Davidson. They’ve boosted their share of the market back to 24 per cent in quarter three.

It’s a bit lower than the 28 per cent shown buying in 2016, but better than the 22 per cent recorded earlier this year.

“Despite extra regulatory pressure (Healthy Homes rules, the looming removal of negative gearing; longer-term threat of a capital gains or income tax), these figures show that new investors are still entering the market or existing landlords are expanding their portfolios,” he says.

Homeowners shifting house have a relatively low share of the market compared to previous years. At 27 per cent, their share is the lowest it’s been since early 2011.

“The high cost to trade up, both in terms of the higher price for a newer or larger house as well as legal and moving expenses, will be a key factor keeping existing owners where they are.

“We also know from high levels of building consents for renovations, that owners are altering rather than moving.”

First published 18 October 2018

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