RTTNews - Home affordability in New Zealand rose 8.5% sequentially in the three months ended May, representing the largest quarterly rise in a decade, the Massey University Report showed Tuesday. The report said the current low mortgage interest rate environment was the main reason for this increase, along with static or falling house prices.
During the quarter, all the regions showed improvement, with the fastest rise being in Manawatu/Wanganui, by 16.3%. The least improvement was in Auckland, where affordability rose 4.2%.
Recent increase in house sales volume suggests more first time home buyers are now entering the market and taking advantage of improved affordability. However, some potential first home buyers are being shut out of the market while they save for the larger deposit (20%) now required by most lenders, the report said.
Annually, home affordability in all districts climbed 17.7% in the quarter ended May, with the biggest increase of 29.8% seen in Northland. This was followed by a 28.1% growth in Southland and a 24.5% rise in Manawatu/ Wanganui. Affordabilty increased in double digits in all other regions too.
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