Why Selling Your Home Within 3 Years Could Hurt Your Wallet

Topic #1:  RNZ 13th of May - Lull in property values present home buyers 'rare opportunity'

Topic #2: Stuff 15th of May - People selling their home within three years could be facing a loss, new report finds

Topic #3: Interest.co.nz  15th of May - Housing sales and selling prices both edged lower in April, with REINZ saying buyers are being picky

Topic #4: RNZ 15th of May - Falling interest saving home loan borrowers $2.2b, bank says

Topic #5: Oneroof 14th of May -Tony Alexander: Reasons to be cheerful - but don’t expect a boom anytime soon

Transcript

 Hi everyone. I'm Debbie Roberts, owner and financial advisor at Property Apprentice. Join us today for the week in review where I talk about current events for the everyday investor and home buyer. Our topics for this week. 


  📍 Topic number one from RNZ on the 13th of May. Lull in property values present home buyers rear opportunity. Topic number   📍 two, from Stuff on the 15th of May

 people selling their home within three years could be facing a loss-- new report, finds.  Topic number three from   📍 interest.co.nz 15th of May, housing sales and selling prices both Edge lower in April with R-E-I-N-Z saying buyers are being picky.    Topic number four, from   📍 RNZ on the 15th of May. Falling interest, saving home loan borrowers $2.2 billion,

banks say.  Topic number five from   📍 Oneroof on the 14th of May. Tony Alexander: reasons to be cheerful, but don't expect a boom anytime soon. 


 So first up this week in review topic number one, RNZ on the 13th of May. Lull in property values present home buyers rare opportunity according to property data firm- QV quotable value first time buyers currently have a rare chance to enter the housing market.

While nationwide property values increased slightly by 0.1% in the three months to April, they remained 1.33% lower than the same time last year. Auckland and Wellington saw more significant annual declines with values falling 2.89% and 4.11% respectively. Despite these drops, QV noted early signs of stabilization, particularly in major centers as sentiment in the market begins to shift.

Although interest rates are starting to fall, the expected rapid rise in prices hasn't materialized due to cautious buyer behavior and a surplus of listings. This environment is creating favorable conditions for first time buyers and new investors, especially in parts of Auckland, where prices are in the $700,000 range are increasingly common.

Many of these buyers are gravitating towards townhouse developments in Wellington. High listing volumes are placing downward pressure on prices. Buyers are showing little urgency, often walking away from properties, influenced by ongoing economic and job market uncertainty. Christchurch stands out as an exception. Values

there rose 1.35% year on year and 0.88% over the quarter. The city's market is considered balanced, with well located and well presented homes selling steadily. Buyers have more negotiating power and overall market activity remains stable.


 Second topic for this weekend, review from staff on the 15th of May.

People selling their home within three years could be facing a loss-- a new report finds.

According to Cotality New Zealand's latest pain and gain report, homeowners who sell within two or three years of purchase are increasingly likely to incur losses In the first quarter of 20 25, 90 0.8% of property resales were made at a gross profit down slightly from 91.1% in quarter 4 20 24. The median gross profit dropped to $280,000 in quarter one compared to $298,000 in the previous quarter, and a peak of $440,000 in late 2021.

Meanwhile, the median resale loss remained stable at $50,000, continuing a three-year trend of losses ranging between $50,000 and $60,000. Despite recent property value declines still about 16% below the early 2022 peak, most long-term owners are selling in a profit, the typical profitable resale involved in a property held for 9.1 years,

highlighting how longer ownership generally shield sellers from market volatility. Ownership duration wasn't the only factor Influencing resale outcomes, property type also played a role. Only 8.4% of houses sold at a loss in quarter one compared to 32.8% of apartments. Apartment losses were often attributed to personal circumstances rather than broader market trends.

Median resale losses were higher for apartments at $63,000 than houses at $49,000, while resale profits were $128,000 for apartments and 280,000 for houses reflecting their typically lower purchase prices. Cotality New Zealand's Chief Property Economist said that while a sharp market rebound isn't expected, easing interest rates should gradually support property values and profitability throughout the rest of 2025.  📍  📍 

If you'd like to learn more about investing in property, join me at one of our free events called How to Succeed With Property Investing. I'll discuss strategies for successful investing from my perspective as an experienced investor and a financial advisor, and all of our free events are available

live online. Check out www.propertyapprentice.co.nz for upcoming dates and register today.  We don't sell property,   📍  📍 so it's all about increasing your knowledge to reduce your risk. If you've already been to one of our free events and would like to find out more about how we can help you to reach your financial goals, you can also book a no obligation phone call or meeting with my husband Paul Roberts via the website.

That's www.propertyapprentice.co.nz. 

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 Topic number three from interest.co.nz on the 15th of May, housing sales and selling prices both edge lower in April with REI NZ or REINZ saying buyers are being picky. Both property prices and sales volumes declined in April according to REINZ which attributed the slowdown to seasonal market cooling. Nationwide

6,427 rental properties were sold in April. That's a 17.6% drop from March as total of 7,797. However, sales were still up 9.5% compared to April, 2024. The national median sale price dipped to $781,000. That's down 9,000 or 1.1% from both the previous month and the same time last year. The REINZ house price index, which adjusts for property type and location also fell 0.3% year on year and month on month.

Some regions saw more pronounced declines. Porirua recorded the largest monthly drop at 2.5%, followed by Auckland's Rodney, down by 2.2% by Waitakere and Manakau both down 2.1% and Napier down 2%. REINZ's acting Chief Executive Rowan Dixon noted that while sales activity has increased compared to a year ago, prices are still falling due to a high volume of listings.

Buyers remain price sensitive and are showing a willingness to consider alternatives when asking prices appear too high. 

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Topic number four from RNZ on the 15th of May. Falling interest, saving home loan borrowers $2.2 billion. Bank says BNZ. Estimates that declining interest rates could deliver about $2.2 billion in savings to New Zealand mortgage holders over the next six to 12 months.

While mortgage rates have been falling steadily since mid 2024, the financial relief for households will only become apparent as fixed term loans come up for renewal. The average two year special home loan rate has dropped from nearly 7% to around 5%, and the official cash rate is has declined from a peak of 5.5% down to 3.5%.

BNZ, chief Economist Mike Jones noted that these benefits take time to reach household budgets, which explains the continued sluggishness in the economy. He said most of the financial boost is still on the horizon and how households choose to spend it will influence the economic outlook. Jones suggested that while some of the extra cash will go towards covering essential expenses, there's potential for modest increases in discretionary spending, such as hospitality, travel and tourism.

However, lingering concerns about job security and global instability may keep many consumers cautious. He also observed that households have cut back in areas like entertainment and retail while maintaining or increasing spending on essentials such as utilities, healthcare, and education. Although inflation has eased, it continues to weigh on con on consumer confidence and behavior.

Despite some support from lower interest rates in a relatively strong rural sector, Jones expects New Zealand's economic growth to remain subdued. Still, he believes the outlook has improved compared to last year's recession, and anticipates the official cash rate could fall further to 2.75%. 

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Last topic for this Week in Review

Review from Oneroof on the 14th of May. Tony Alexander. Reasons to be cheerful but don't expect a boom anytime soon. There are signs of economic improvement in New Zealand, though the pace of recovery remains modest. Recent data suggests progress, but underlying challenges continue to temper expectations.

Employment figures showed a slight point 0.1% rise in the March quarter and improvement on the 0.2% fall in December, and the 0.7% drop in September. GDP, which contracted by 1.1% in both the June and September quarters of , rebounded with a 0.7% increase in December. Business and consumer sentiment is also improving.

A N Z's business outlook survey reported a net 49% of firms expecting better conditions in the year ahead compared to just 6% in mid 2024. Similarly, consumer spending intentions have strengthened with a net 18% now planning to reduce spending that's down from 42% previously. However, both indicators are still below their December highs, suggesting cautious optimism.

In December, business confidence had reached a net 66% and consumer sentiment was at a net 10% positive.

Export performance, traditionally, a strong growth driver is currently solid. Commodity prices are up 19% year on year, and dairy payouts are expected to be strong. Yet the typically supportive decline in the New Zealand dollar seen in past recoveries is largely absent, only a modest drop of two to 4 cents since mid 2023 has occurred.

This limited currency depreciation combined with rising input costs for exporters is dampening the potential boost to local economies. Adverse weather events like droughts and floods are also suppressing regional spending outside of farm repair. Consumers continue to feel the strain of high living costs, particularly for essentials like food, electricity, and rates.

Rates, especially potentially. Meanwhile, government spending is being reigned in to manage debt and the Chinese economy. New Zealand's largest trading partner remains sluggish. Other constraints include an oversupply of townhouses in some regions, global uncertainty from trade tensions and slower migration.

These factors along with compressed business margins and cautious bank lending point to a restrained economic upturn in 2025. This subdued recovery has implications for businesses with revenue growth limited and costs still rising, cash flow will remain tight. This environment is contributing to a rising number of business closures, a trend already underway and likely to continue as the Inland Revenue Department recovers pandemic related debts.

Business owners are advised to closely monitor receivables and temporary expectations for bank lending. Caution is expected to dominate credit decisions throughout the year.   📍  📍 With interest rates, easing house prices, stabilizing, and new opportunities emerging in key regions like Auckland and Wellington,

now could be the perfect time to take your next step, especially if you're a first home buyer or looking to grow your portfolio. Join us at one of our free events called How to Succeed With Property Investing. These events are all available online so you can gain valuable insights and strategies tailored to today's market conditions.

And because they're live events, you have the ability to ask questions while you're online. Whether you're an experienced investor or just getting started, this free session will equip you with the key tools and insights to make confident, informed decisions. Don't miss out: register for one of the free events today and take the next step towards achieving your financial success.

In our free events, I'll also tell you more about how we can help our clients to achieve their investing goals. So if you're interested in finding out more about what we do, visit www.propertyappprentice.co.nz today and register for one of our free events.  If   📍  📍 you've already been to one and you'd like to know more about how we can help you on your journey book a no obligation phone call or meeting with my husband Paul Roberts through our website

that's www.propertyapprentice.co.nz.  Thanks for listening.