2020 was an unexpected year (to say the least). When there’s so much uncertainty, it can be hard to make big money decisions, particularly when it comes to buying property.

I’ve had dozens of people ask me whether now’s a good time to buy or not and I tell them all the same thing. 

“Buy when you’re ready”

The right time to buy property is always when you’re ready on a personal and financial level. That means you:

• Are ready to own a home if you’re an owner occupier. 
• Have made sure the numbers add up if you’re an investor. 
• Are on the same page as your partner or whoever you’re buying with.
• Have done your homework on the market. 
• Have done your sums and you’re sure that you can afford mortgage repayments, rates, maintenance, purchase costs and other extra costs.

With prices going up all over New Zealand and hot competition for property, it’s easy to feel rushed – property’s not getting any cheaper after all. Despite that, rushing a purchase is never a good idea. Always take your time and make sure you’re ready first!

Now is as good a time as any

If you’re ready to buy now, early 2021 could be as good a time as any despite all the uncertainty. Here’s why.

Property prices are rock solid

The national median house price increased by 18.5% during the 12 months to November 2020, reaching $749,000, according to the Real Estate Institute of New Zealand. NZ’s three biggest cities where Williams Corp develops residential property also experienced huge median price increases during the same period. 

• Auckland: 16.3 % increase to $1.03 million. 
• Wellington: 14.5% increase to $790,000. 
• Christchurch: 13.8% increase to $481,219.

If you purchase a well located, high quality property in the near future, there’s a good chance you’ll enjoy solid capital gains too. 

Interest rates are lower than ever

Interest is the main cost of most home loans and right now, rates are lower than they’ve ever been. A good rate at the moment is below 2.5% but soon the average home loan rate could be under 2% (Heartland Bank are already offering 1.99%). 

That means paying a mortgage may become even more affordable in the near future.

2021 is looking good

The good news is that the housing market is forecasted to keep going strong into 2021. In fact, Westpac economists recently predicted that the national median price would increase by 12.2% over the coming year.

Interest rates are expected to stay low too. The Reserve Bank has even signalled that they may drop the OCR into negatives for the first time ever, which should put downward pressure on interest rates. 

Despite the craziness of the New Zealand property market right now, you should never rush a huge decision like buying a home or an investment. But if you’re ready, now’s a better time than ever to make it happen!