Latest / The SME Stream / Kelvin Davidson: Cotality's Chief Property Economist on house prices falling 1% in 2025

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Kelvin Davidson: Cotality's Chief Property Economist on house prices falling 1% in 2025 · The SME Stream

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  Speaker 1: You're listening to a podcast from News Talks. It'd be
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  Speaker 2: So the numbers are in and we may be in
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  Speaker 2: for a more positive property market this year. Totality's generally
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  Speaker 2: Home Value Index shows property values were down one percent
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  Speaker 2: in twenty twenty five. That is a drop of seventeen
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  Speaker 2: percent from the twenty twenty two peak, but regions in
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  Speaker 2: some cities point to recovery in twenty twenty six. Is
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  Speaker 2: this true? Is this a mirage? We're joined by Totality
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  Speaker 2: chief property economist Kelvin Davidson Halla Calvin Gooday, we've only
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  Speaker 2: seen nationwide declines over the last few years, so why
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  Speaker 2: are we forecasting increases.
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  Speaker 3: I just think some of those factors that have been
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  Speaker 3: restraining house prices in the past couple of years are
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  Speaker 3: are starting to turn around, and we know more which
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  Speaker 3: rates it down. Of course that's been in place for
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  Speaker 3: a while, but the biggies economy, it looks pretty clear
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  Speaker 3: now the economy is turning around. Unemployment right, should turn
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  Speaker 3: down this year, so I think it'll get the house sold.
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  Speaker 3: It's a bit more confidence and they might be put
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  Speaker 3: in to act in the housing market more.
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  Speaker 2: So, there are some centers that are looking up that
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  Speaker 2: there are others that seem to be a bit of
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  Speaker 2: a lost cause. Does Auckland a bit of a lost cause?
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  Speaker 3: Well, it might be a bit strong, but certainly Auckland
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  Speaker 3: has been underperforming the other parts of the country. And
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  Speaker 3: I think if you want to look at that in
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  Speaker 3: a positive way, because of course there's always positive and negative,
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  Speaker 3: two sides to the corn in the housing market. But
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  Speaker 3: one thing is that it shows what happens when you
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  Speaker 3: can raise supply. We've seen it in Canterbury over the
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  Speaker 3: past of the ten to fifteen years. Seeing in Auckland
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  Speaker 3: now when you get more houses you can keep housing
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  Speaker 3: affordability a bit more favorable and keep house prices in check.
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  Speaker 3: So I think that's a good illustration again and what
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  Speaker 3: supply can do.
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  Speaker 2: We always wanted a crash, I mean some elections having
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  Speaker 2: fought on this sort of thing, we wanted a correction
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  Speaker 2: that then, of course when it happened, we all went oo,
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  Speaker 2: this is not very nice at all. What do you
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  Speaker 2: think the new normal will be? Will we go back
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  Speaker 2: to the endless profits on property property or do we
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  Speaker 2: think or will we get a slowly accruing market.
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  Speaker 3: Yeah, I think it's probably more likely to be slower
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  Speaker 3: than it has been in the past. And well, I've
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  Speaker 3: said the economy is picking up this year, that should say,
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  Speaker 3: but a house price growth, I think it's probably going
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  Speaker 3: to be pretty modest. Part of that is to do
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  Speaker 3: with the debt to income ra share restrictions. Part of
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  Speaker 3: that's to do with more supply than we've had in
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  Speaker 3: the past relative to our population. So those are sort
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  Speaker 3: of near term factors. But then in the longer term
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  Speaker 3: we can't have interest rates trending down anymore. It looks
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  Speaker 3: like the government, well it has to stick through the
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  Speaker 3: political cycle, of course, but the government's pushing very hard
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  Speaker 3: on housing supply. We've got those learning restrictions in place
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  Speaker 3: for the ose tech system might be a bit less
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  Speaker 3: favorable in future, capital games, text, these sorts of things. So, yeah,
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  Speaker 3: we've been talking for a while now about house price
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  Speaker 3: growth in future. Then house price growth in future that's
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  Speaker 3: a bit lower than it has been in the past,
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  Speaker 3: So still a bit of growth, but less sin it's been.
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  Speaker 3: So I think a lot of people I think we'll
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  Speaker 3: be starting and say, well, actually that's a pretty good thing,
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  Speaker 3: and good stuff.
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  Speaker 2: Kelvin Davidson is from Cotality. He is the chief Property Economist.
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