Why Covid-19 is unlikely to hurt Christchurch house prices
Over the last month and a half, New Zealand's housing market has seen significant changes, the full impact of which may not be clear for some time. The results of OneRoof's Mood of the Market survey this week shows buyers and sellers are worried about the economy and house prices but, for now, their property plans remain unaffected.
This suggests that severe price drops of 20 percent or more are off the cards.
While some housing markets, such as the tourism-dependant Wanaka and Queenstown, are more at risk, others may be strangely suited to weather the Covid-19 crisis.
Economist Ed McKnight believes that of all the major metros, Christchurch will be the least prone to extreme fluctuations in the months ahead. “How can house prices decrease even further than what they are now? The prices there are already so low compared to the rest of the country and Christchurch is at the bottom of its property cycle.”
Before the lockdown, house price growth in Christchurch was negligible, with the city's median value rising just 9.5 percent to $460,000 in the last five years (Auckland's median value by comparison grew 32.9 percent over the same period).