As the end of the year hurtles towards us, the property market has rebounded with a different energy compared to the start of the year.
ASB’s Housing Confidence Survey for the September quarter echoes this feeling, with survey respondents feeling more confident about the housing market, with increasing numbers thinking it’s a good time to buy.
Of the survey’s 2864 respondents, 27% said it was a good time to buy compared to 22% in the second quarter of this year, representing a seven year high.
What’s contributing to this positivity? Continuing record low mortgage interest rates play a major role, with 43% of respondents expecting lower interest rates over the coming year compared with 31% in the second quarter. Accelerating wage growth is also helping affordability levels and the ability to buy, especially in the first home buyer market.
Although the news is good, this doesn’t mean that another boom period is just around the corner. In reality, we are now just returning to normality after the earlier dip in both activity and prices earlier this year.
This optimistic attitude is certainly translating into sales numbers. Over the past three months activity has increased across open home attendance, auction clearance rates and the pace of property sales. Multi-offers are making their return for well-presented properties in desirable areas and in the run up to Christmas determined purchasers have been putting their money where their mouth is, and are making good buying decisions.
A final thing to note for those buyer still currently in the market for a property is that new rules are set to come into effect around using the finance clause to back out of a sale and purchase agreement.
Under the changes to the finance condition in the 10th edition of the sale and purchase agreement, purchasers will now be required to provide evidence if they can’t raise finance. Evidence might include a letter or email from the purchaser’s bank confirming that finance has been declined.
This is a significant change and so purchasers do need to understand the implications if they cannot provide evidence that they are unable to raise the finance, as they may be forced to proceed with the purchase or face other legal action by the vendor.
The new change caps off a year of increasing regulation in the property market, which serves to protect both buyers and sellers. If you have any queries about this change or any of the others this year, please contact us as we have extensive knowledge about these new rules.
All that’s left now for 2019 is to say ‘Merry Christmas’. We hope you have a safe and relaxing holiday and we look forward to your business in 2020.