- Experts advise early preparation for buying in 2025 amid expectations of price rises.
- Major banks forecast annual lift of between 5% and 10%, despite potential restraints.
- Getting pre-approval and doing your homework among the top tips for success.
Pre-empting a likely upswing in the real estate market by preparing early is the biggest thing a person can do to get themselves ahead in New Zealand’s housing market in 2025, experts say.
Start your property search
The consensus view of last year's housing market is that prices finally hit the floor and are now slowly climbing their way back up, helped by falling interest rates and tentative signs that the country's economy is putting two long years of "recession" behind it.
Investors and traders have started to show their hands again in the auction room, and while the resulting sale prices are nowhere near what they were at market peak, the bidding action has been on par.
The end-of-year house price forecasts from the major banks have ranged from 5% to 10%-plus in 2025, although rising unemployment, a glut of stock on the market, debt-to-income ratio lending rules, and uncertainty in global politics may act as restraints.
Opes Partners managing partner Andrew Nicol told OneRoof there already appeared to be “quite a shift in sentiment” in the market. He advised buyers looking to get ahead of any potential boom to do their prep work now.
“Preparation is the number one thing I’d be doing now if I was a soon-to-be, or aspiring, property owner. I'd be going to the bank, going to the brokers, finding out how much money I could borrow, finding out the difference between buying existing or new. I’d want to know if I needed to renovate, as that would affect lending,” he said.
By getting pre-approved early, a person was in a position to recognise a good deal and take action swiftly - before house prices went up, he said. “I think there will be quite a lot of momentum next year,” Nicol said.
Trish Marsden, an adviser at O’Hagan Home Loans and Insurances in Whakatāne, said there was potential for power in the market to move away from buyers.
“Usually, we are aware of what the market is going to do in a couple of months and right now we are flat stick. There’s a perception that it’s a good time to buy, and there’s a glut of stock on the market.”
Discover more:
- Revealed: Banks put the brakes on 'secret' mortgage rate discounts
- History-making brothel for sale - 'if these walls could talk'
- West Coast vs Auckland: Did buyers miss a better deal pre-Covid?
People came to see Marsden’s team saying they knew they were a long way off, “but this is the best time to see us”, she said.
“If people wait, it will be good for sellers but not necessarily buyers. Those are the indications we are seeing. Things are changing quickly.”
In Rotorua, The Mortgage Centre principal advisor Praveen Bhati said preparation was critical to ensure a person was not just able to buy when ready, but knowledgeable enough to make or negotiate good deals, he said.
“For me, it’s all about starting early, as soon as someone has thought ‘we should buy a house’ sometime in the next 12 months, they should speak to a professional – a mortgage broker or the bank – and find out where they stand and how far they are to achieving their goal,” he said.
“A lot of the time, people wait and wait, see a property, then go to the bank which tells them they are still six to eight months away.”
A willingness to reconsider plans would also help someone get ahead in the long-term, Bhati said.
Some first-home buyers had lofty goals of what they wanted when half were already in a position to buy something cheaper, he said. “I tell them, the first home doesn’t have to be a final home, it’s all about getting on the ladder. Add some value, then sell it and walk away with good profit and get a better place.”
Yearly mortgage check-ups were especially important “because a lot of things can change in a year”.
Bhati said a 30-year mortgage could be virtually halved by something as simple as paying an extra $100 to $120 a week. If someone’s income increased after two years, they should consider paying more into the mortgage for that reason, he said.
If people could afford it, they could end up saving thousands.
Top tips to get ahead
1. Take advantage of all the stuff that's available for free, such as first-home buyer seminars put on by iwi or banks.
2. Attend as many open homes and auctions as you can. You don't need to buy, you just need to learn.
3. Prioritise paying off debt over savings – you might be paying more in interest than you are making in savings.
4. Be cautious of developers off-loading "lemons".
5. Don’t buy into the hype. Make sure you know what you are looking for, and that you have a plan to achieve it.
- Click here to find more properties for sale
