According to the Roost Home Loan Affordability report, the home loan affordability in New Zealand improved for the third consecutive month in September and reached its best in a year. In fact, it is now back to its best levels last enjoyed in December 2004.
The reason for this improvement has been attributed to the slight decrease in the aggregate bank fixed mortgage rates, accompanied by house prices remaining flat and incomes going up.
It is expected that affordability will again improve significantly in October due to the NZ$29 per week improvement in the average after-tax income accompanied by personal income tax cuts. The current situation is, according to economists, a 'buyers market.'
It is now anticipated that the Reserve Bank will put the Official Cash Rate on hold till 10th March of next year due to the slow rate of economic growth here and overseas under any kind of inflation pressures.
The price of the average national house was a flat NZ$350,000 in September and at present it has reduced by 3% from its record price of NZ$360,500 in March.
The affordability was measured at national and regional levels taking the median house prices, interest rates and incomes into account.
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