Weaker Property Prices Mean More Bang for Buck for First Home Buyers Christchurch
First home buyers Christchurch(FHBs) are finding 2024 to be a prime year for entering the property market. With lower property prices, low-deposit finance options, and less competition from other buyer groups, the market conditions are highly favourable. According to CoreLogic’s biannual First Home Buyer Report, FHBs accounted for 26% of property purchases in Q1 2024, well above the long-term average of 21%.
Market Trends Favour First Home Buyers
The recent CoreLogic report highlights a significant presence of FHBs in the market, driven by several key factors:
- Lower Property Prices: The median price paid by FHBs has decreased from $715,500 in 2022 to $695,000 in Q1 2024. This decline allows first-time buyers to purchase larger, standalone houses, offering more value for their money.
- Low-Deposit Lending: Many FHBs are utilising low-deposit lending options, with some schemes allowing deposits as low as 5%. This accessibility makes home ownership more achievable, even in a high-interest-rate environment.
- KiwiSaver Funds: First home buyers are tapping into their KiwiSaver funds and government grants, such as the FirstHome grant, to boost their deposit savings. This financial support reduces the upfront cash requirement, making it easier to enter the market.
- Reduced Competition: With investors facing more stringent conditions, there is less competition for properties. This shift allows FHBs to secure homes more readily.
- Lifestyle Factors: The desire for stability and long-term investment is driving many first-time buyers to prioritise home ownership despite the cost differences between mortgages and rent.
Why Christchurch is Ideal for First Home Buyers
Christchurch presents a particularly advantageous market for FHBs in 2024:
- Affordability: The city’s property prices are more accessible compared to other major urban centres. FHBs can find good deals and larger homes within their budget.
- Urban Growth: Christchurch is experiencing growth and development, offering a variety of housing options, including new builds and renovated properties.
- Community and Lifestyle: The city provides a balance of urban amenities and a relaxed lifestyle, making it an attractive place for young families and professionals.
Removal of the First Home Grant: A Positive Shift
The Government’s decision to scrap the First Home Grant may seem concerning at first glance. However, this change could be beneficial for first home buyers in the long run. The First Home Grant, which provided a median of $5000 towards a house deposit, was seen as an expensive and inefficient method of support. By redirecting these funds towards increasing housing supply, the Government aims to address the root cause of the housing crisis. With more houses being built, first home buyers can expect better opportunities and a more balanced market in the future.
Expert Guidance with Canterbury Home Loans
Navigating the home buying process can be challenging, but with the right support, it becomes manageable and rewarding. At Canterbury Home Loans, we specialise in helping first home buyers like you secure the best financing options and make informed decisions.
Next Steps for First Home Buyers:
- Assess Your Finances: Ensure your finances are in order. Close any excess credit accounts and manage your expenses diligently.
- Utilise KiwiSaver: Take advantage of KiwiSaver funds and government grants to strengthen your deposit.
- Explore Low-Deposit Options: Investigate low-deposit lending schemes that can make home ownership more accessible.
- Find Your Home: Start searching for properties that meet your needs and budget. Use resources like Settled.govt.nz for valuable information.
- Consult a Mortgage Broker: Work with a mortgage broker Christchurch to explore the best loan options and secure a pre-approval.
If you’re ready to take the next step towards home ownership in Christchurch, contact us at Canterbury Home Loans. We’re here to guide you through every step of the process and ensure you get the most value from your investment.