Expectations of house price inflation continue to climb in ASB’s latest quarterly survey and are close to their all-time high 10 years ago.
The same seller’s market is reflected in a drop in the net balance of people who consider it a good time to buy a house. In Auckland and Christchurch it is now regarded as an outright bad time to buy.
Reflecting rising actual prices, a net 59 per cent expect them to rise further, the survey found, up from a net 56 per cent three months ago.
In Auckland the increase was steeper, from a net 61 per cent last time to a net 66 per cent.
The highest this indicator has been, nationwide, in the 17 years of the ASB survey was 61 per cent in January 2003. But while the pressure then was from the demand side, this time it is a lack of supply, according to ASB chief economist Nick Tuffley.
“Demand for housing has lifted modestly over the past year, reflecting a return of first-home buyers as the labour market stabilises, as well as increased interest from investors,” he said.
“However, supply of new housing has not yet picked up in response to stronger demand.