First home buyers are often tempted to only buy a property where they’re living. It’s the town they know; they have a sense for the local properties and know what they like. But this may seem unaffordable – especially for buyers living in Auckland. Instead of focusing on what they know, successful first home buyers focus on the areas that will firstly allow them access to the market, and secondly be an investment that grows their equity.
Why smart first home buyers are avoiding Auckland
Auckland is an amazing city. It has a great culture, a strong economy and amazing people. Sure, they’re good reasons to live in Auckland, but not necessarily good reasons to invest in Auckland’s property market.
Auckland has experienced increasing immigration, overseas investment in property, supply shortages and low interest rates. These factors have boosted the property market 50% higher than 12 months ago, to an average of $942,760. This price point may seem too high for many first home buyers. The interest rates and deposit required by the bank often seem unreasonable for singles, couples and families, and while mortgage brokers such as iLender can offer a solution when the bank says no, you may choose to look elsewhere for better opportunities – such as Wellington.
Wellington offers affordability and growth prospects for first home buyers
Wellington’s average house price is $491,236, which is substantially less than the average house price in Auckland of $942,760. This makes buying in Wellington a more realistic prospect for first home buyers. While they are less likely to secure funding in the expensive Auckland, they will be able to receive funding from Banks or non Banks purchasing property in Wellington. For owner occupied property 90% is still possible and for rentals 80%.
Wellington has seen an increase of 7.5%. As interest rates are expected to stay low, and overseas investment is beginning to spread throughout New Zealand, it is expected that Wellington’s property prices will rapidly rise over the coming 2-5 years. This makes now an excellent time to enter the market, capturing the opportunity before the rise in prices.
Are you looking to enter the Wellington property market?
If you want to enter the Wellington property market, now is the time to act. By waiting you may miss the low interest rates and growth in Wellington. This is especially important for first home buyers, who need to take every advantage they can find in the property market.
iLender can help you get into Wellington’s property market right away. We aren’t like the banks – we have less red tape, accept lower deposits and act fast! By acting now, you can enter the property market and realise the expected gains in the Wellington property market as your own.