House prices set to rise—land agents

Press, 20 October 1986, Page 6

House prices set to rise—land agents

PA Wellington House prices will rise because of the ample supply of mortgage finance and a growing shortage of houses on the market, says the president of the Real Estate Institute, Mr Peter Cook.

“We expect that from now on there will be an improvement in market prices,” Mr Cook said. He was commenting on the latest Reserve Bank figures which showed that home lending by traditional institutions in the June quarter reached the highest levels ever.

For the second time recorded, the number of housing loans advanced in the June quarter topped

21,000. The last was the June, 1985, quarter.

In the three months to June this year, trading banks approved 6741 loans valued at $145.8 million, trustee banks advanced $107.4 million, and insurance companies advanced 2229 housing loans, a 130 per cent increase over the March quarter. Building societies also approved 2539 loans at a value of $83.5 million. Mr Cook said the real estate market had been buoyant until June when there was an easing in sales. This lasted to midSeptember.

He attributed this to prospective buyers hoping that mortgage interest

rates would come down. Since then, with increased competition between lending institutions and rates dropping, there was a “very marked improvement” in inquiries and sales.

Most listings sold in July and August were bought at close to asking prices. The real estate market was sound at present and climbing, he said.

“Purchasers appreciate that mortgage rates have dropped and are keen to purchase now before prices go up too much,” he said.

The buoyant market was spread throughout New Zealand, with few exceptions.