House-prices rise warning

Press, 19 June 1986, Page 27

House-prices rise warning

PA Tauranga Falling mortgage interest rates could cause higher house prices, said the national president of the Real Estate Institute of New Zealand, Mr Bill Matthewson. He warned sellers not to be so optimistic that the new rates would fuel demand that they increased the prices of their homes. “They would price themselves off the market if they did this,” he said. “Those who need to sell should keep the price what it is today. There is a big backlog of unsold houses.” Mr Matthewson said house sales had dropped quite considerably during the last 12 to 18 months. The number of houses for sale was the highest he had seen in more than

20 years in the real estate business. The pool was caused by high interest rates making homes unaffordable. As interest rates fell the effect would be felt throughout the market. He said the houses would begin to sell as long as interest rates stayed down long enough for people to gain the confidence to commit themselves to mortgages. “People have been bitten too much to rush into the market at such an early stage.”