The NZHL Property Report’s survey of real estate agents by Tony Alexander shows a net 11 per cent of real estate agents saying more people are attending open homes, a change from the net 35 per cent who last month said fewer people were attending.

However, it’s a different story for auctions. A net 11 per cent of agents are seeing fewer people at auctions. This is an improvement from 37 per cent last month and 41 per cent two months ago, but shows people are still backing away from buying at auction.

A net 12 per cent of agents have reported seeing more first home buyers in the market. This is an improvement from the net three per cent last month, who said fewer young buyers were around. The reading is still low by historical standards.

In comparison, two per cent of agents are seeing fewer investors in the market, but this is an improvement on 24 per cent reporting this last month. And those investors in the market are there hoping to find a bargain, cited by 48 per cent of agents.

Alexander says interest rate declines may be exciting some purchase interest. However, 32 per cent of agents say no such purchase plans by investors exist, but this is down from 42 per cent in June and is the lowest such reading since 20 per cent in January.

As for investors selling, there was a surge late last year in agents saying that investors were bringing more properties to the market. Last month, 16 per cent of agents reported more investor sellers, up from 14 per cent.

Continuing with the theme that people have only just started returning to the market to look at properties but not yet necessarily bidding on them, 29 per cent of agents around the country say prices are still falling, although Alexander says the speed of decline is likely to be slowing.

More enquiries

After two months during which there was a low level of enquiry from people about potentially listing their homes for sale, there has been a lift to 23 per cent of agents receiving more inquiries.

Alexander says this suggests that as demand is showing signs of lifting so, too, will supply and that makes picking house price changes quite difficult.

The ANZ has downgraded its house price forecast for the rest of the year and now expects a one per cent year-on-year drop, as opposed to a one per cent rise.

Beyond this year, the bank sees scope for house prices to recover and has pencilled in a slightly sharper rebound of 4.5 per cent year-on-year versus four per cent previously.

And ANZ chief economist Sharon Zollner says house price inflation should stabilise at about five per cent year-on-year over 2026, a bit below the 2010-2020 average of about 6.5 per cent year-on-year and the 2000-2010 average of 7.5 per cent year-on-year.

But given house prices relative to incomes have continued to trend higher over the past few decades, the potential for house price inflation to persistently outpace household income growth appears limited, she says.

“That is, affordability constraints are likely to limit upside potential for house prices, particularly now we are returning to a more normal inflation environment.”

While prices are still dropping, the fear of missing out (FOMO) is coming back into the market, with nine per cent of agents seeing it being displayed by buyers.

This figure has risen steadily from the record low of one per cent at the end of June and is the strongest result since 11 per cent in February, but still well below the 40 per cent readings last year and low by the standards of our survey for the past four years.

The main worry for buyers continues to be securing finance, even though there has been a tweaking of lending rules over the past 18 months.

Worries that prices will fall after buying lifted strongly early this year but may now be easing, Alexander says.

Job concerns

For the fourth month in a row, job concerns remain high and given the ongoing reports of redundancies it seems premature to conclude that a slight decline in this measure is necessarily the start of an improving trend.

Interest rate concerns have fallen away strongly, with just 23 per cent of agents saying buyers are concerned about where rates are heading. In June this reading was 42 per cent and the peak was 91 per cent in October 2022.

Last week, ANZ trimmed most of its home loan fixed rates to become market leading.

The bank has taken -6 basis points off the six-month rate to 6.99 per cent, -20 basis points off the 18-month fixed rate to 6.49 per cent, -15 basis points off the two-year rate to 6.34 per cent and -36 basis points off the three-year fixed rate to 5.99 per cent.

It did not touch its one-year rate, which has stayed at 6.85 per cent.

Interestingly, the bank also cut its floating home loan rate by -15 basis points to 8.49 per cent for new loans, but not until August 15 for existing borrowers.

Its revolving credit “flexible home loan” rate also falls -15 basis points to 8.60 per cent, but not until August 15 for new and existing clients.