Property investment is on the boil again thanks to low interest rates and rising property values. Underlying the price rises are high levels of net migration, low levels of new building and growing numbers of first-home buyers tapping into KiwiSaver balances for their deposit.
Auckland-based investors are taking advantage of the increased equity in their homes to buy properties in the Upper North Island, particularly in the Waikato and Bay of Plenty.
Wellington, which has seen little change in property values since the Global Financial Crisis, is suddenly surging ahead and other areas are seeing growth too. From an investment point of view, property is looking good in comparison with other alternatives.
The returns on fixed interest investments such as term deposits and bonds are the lowest they have been for decades and there is no sign that this will change any time soon.
Worries about the Chinese economy continue to cause volatility in share markets around the world. On the other hand, property prices across the country increased by more than 11 per cent in the year to February according to Quotable Value statistics.
