First-home buyers scared off
First-home buyers appear to be deserting the housing market in the wake of the Reserve Bank’s new limits on low deposit home loans, according to a survey of real estate agents.
The BNZ’s latest monthly survey of agents shows a plunge in the number of first-home buyers in the market.
A net 41 per cent of agents said fewer home buyers were around this month, the first negative in the two-year-old survey and down from a net 24 per cent noticing more first-home buyers in September.
The latest negative figure was well below the average of 31 per cent positive since the survey started in early 2011.
The Reserve Bank’s new rules limiting the amount banks could lend to buyers with a deposit of less than 20 per cent came into force this month.
BNZ chief economist Tony Alexander said the collapse in first-home buyers in the market would probably not be sustained, once first-home buyers got used to the new rules. Each month more would qualify for the new deposit rules as they saved more money and more would find alternative sources of finance each month.
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