Housing market to bounce back in 2009, predicts property information website

A 50% increase in property sales is likely to be seen over the next two years as the market climbs out from the lowest relative point of the past two decades, according to predictions from property information website Zoodle.

Total house sales in 2008 were 56,000, the lowest for two decades. The figure represents 3.7% of total dwellings in New Zealand, whereas the average percentage over the past decade has been around 6%. Current economic conditions have seen the market freeze over the past 12-18 months as uncertainty over property prices, access to credit and security of income have impacted the psyche of property buyers.

However, Zoodle Managing Director Alistair Helm believes there are signs that the market is about to turn a corner.

“The factors which have impacted property buyers will ease at some point in 2009, and with that will come an improvement in the liquidity of the property market. When the right conditions eventuate, sales will begin to pick up with the percentage of total dwellings sold returning towards the average of the past decade of around 6%. That should equate to around 90,000 sales, a 50% increase on 2008.”

Since launching on 15 January, Zoodle has seen a significant amount of traffic, with 30,000 unique visitors to the site in its first week. Information and reports on more than 70,000 properties have been searched, which Mr Helm believes is a firm indication of a turning tide in the market.

“As house prices and interest rates fall, the market opens up more favourably for buyers. I think the sheer volume of traffic that has come through the site is evidence that there are a substantial number of prospective buyers out there who feel that conditions will soon be sufficiently favourable for them to look at entering the market.”