So having a mortgage is looking better for many than saving and watching the twin devils of tax and inflation gnaw away at a nest egg.
Some are criticising the bank for holding the line, recalling how in 2003 it cut from 5.75 per cent to 5 per cent and held its nerve, despite a heady economy which went on to drive house prices up for the next four years.
Reacting to this week's buoyant REINZ figures, Westpac economists Dominick Stephens and Michael Gordon wrote: "Our concern is that the Reserve Bank may be under-estimating the inflationary consequences of a housing recovery".
But BNZ economist Tony Alexander said the data showed the housing market was improving "but the pace of price gains is as yet very mild".
Having said that, in Auckland, where sales have improved 4 per cent in the past three months, prices are 8.7 per cent up from a year ago.
That compares to a Wellington price drop of 2.7 per cent from a year earlier.
Peter Thompson, Barfoot & Thompson's managing director, complained at the end of last month he had 4917 properties on his books, the lowest listings for a February in five years. Lack of listings was still holding the market back from being more active, he said.
Rodney Dickens of Orewa's Strategic Risk Analysis said the fall in mortgage rates since October was yet to fully impact the number of sales and was yet to fully affect prices.
"Our calculation of the average mortgage interest rate charged by the major lenders has fallen from 6.58 per cent in September to 6.11 per cent now, but more significantly, the average two-year fixed rate has fallen from 6.41 per cent to 5.82 per cent and the average three-year fixed rate has fallen from 6.87 per cent to 6.18 per cent," he said.
"There is a moderate interest rate stimulus in the pipeline, so the number of sales should head a bit higher over the next few months and annual house price inflation should head moderately higher during the year.
"But the other primary driver of housing cycles - net external migration - has been driven into negative territory largely as a result of the ongoing earthquakes, said Dickens, warning against thinking the sector was about to boom just yet.
"To put it all in perspective, the seasonally adjusted number of sales in February was 14 per cent below the historical average monthly number since 1992, and even the number in December was 10 per cent below the historical average number," he said.
"The further increase in sales may not even get the number back to the historical average." So, while we might see a further price upturn "it ain't no boom". It won't take much of an interest rates increase to spoil the party, Dickens warns.
Auckland may be the exception, though, with a unique set of pressures driving the growth.
Shamubeel Eaqub, principal economist at NZIER, said Auckland was growing strongly, partly driven by the Canterbury exodus.
"This is adding pressure to a region that has built very few homes in recent years. Rents are beginning to rise sharply in inner Auckland, showing a shortage of housing. Auckland is benefiting from a number of factors, most importantly population and employment growth.
"House prices have fallen about 5 per cent relative to incomes during the recession. So that would be the extent of an upside over the next couple of years, if the housing market went back to the previous peak. But housing affordability is poor and further increases will be specific to those who can afford it," Eaqub said.
"Recent sharp increases in rents and house sale volumes are a catalyst for investors and developers to build more homes. Increasing supply of new homes will reduce the pressure on rents and house prices.
"The broad story is unchanged. House prices are too high and we're in a long adjustment process.
"But localised shortages of housing following a prolonged period of under-building are now emerging. New building needs to pick up now."
House-hunting draws a blank
Vanessa Byrnes has been house-hunting in Auckland for more than a year - and still no luck.
With partner Warren Tully and eight-year old twins Imogen and Scarlett, the director, actor and teacher left Tauranga in January, astonished that months of house-hunting from there resulted in nothing suitable around Pt Chevalier, Westmere, Ponsonby, Grey Lynn or Mt Eden, top of the list for lifestyle, proximity to services, work and schools.
Many of the houses available are run down, leaky or need extensive work which is not warranted by the asking price or are too small for a family of four. Those which are renovated are in a price bracket beyond their range.
Now, the family is renting in Pt Chevalier, love being close to Western Springs and the beach and find it ideal for transport.
Their house-hunting continues in earnest, despite only about 20 family homes being listed in the immediate area.
