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Speaker 1: Ben Z are still bullish about house prices rising in

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Speaker 1: twenty twenty five. This is because mortgage rates are starting

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Speaker 1: to ease, thank you, Adrian. Or at long last, the

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Speaker 1: bank is sticking with their prediction of a seven percent

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Speaker 1: increase across the year following a flat twenty twenty four.

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Speaker 1: Brad Olson, Infometric CEO principal economist is with us, Hey, Brad,

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Speaker 1: good morning, Good morning. So seven percent, what do you reckon.

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Speaker 2: It's probably a little bit higher than what we're thinking

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Speaker 2: at the moment, but there's just so much uncertainty out

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Speaker 2: there around how the housing market responds to what is

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Speaker 2: quite a lot of different factors that are all moving

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Speaker 2: through the system. Now. Ben Z's looking at the latest figures,

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Speaker 2: but also at the path forward for interest rates and

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Speaker 2: similar and saying, well, you know, funnily enough, when interest

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Speaker 2: rates come down, once you get some of the other

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Speaker 2: parts of the economic system that work their way out,

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Speaker 2: then you'll start to see a bit more growth because

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Speaker 2: all of a sudden, you will have more people in

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Speaker 2: the economy who are able to try and get houses

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Speaker 2: that will stimulate that level of demand, and all of

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Speaker 2: a sudden you'll start to push up prices. So I

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Speaker 2: can absolutely buy that story. I think there's also a

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Speaker 2: lot of other factors that we have to work through. First,

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Speaker 2: the fact that we've got, for example, the highest number

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Speaker 2: of houses available for sale since about twenty fifteen, and

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Speaker 2: you know, on some figures, I think nearly six months

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Speaker 2: of stock at the moment suggests that we've got a

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Speaker 2: little bit to get through twenty twenty four before we

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Speaker 2: get too close to our understanding twenty twenty five. So

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Speaker 2: everyone's got a forecast, but even be and Z said that,

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Speaker 2: you know, everything is quite uncertain at the moment because

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Speaker 2: there are just so many moving parts in the economy.

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Speaker 1: And presumably it's going to be different strokes for different

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Speaker 1: folks in different regions, right, because if you are starting

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Speaker 1: from a relatively low average price, you're more likely to

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Speaker 1: see an increase as opposed to your major centers where

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Speaker 1: the prices are already pretty high. Maybe that they're the

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Speaker 1: demand for those or the ability for people to service

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Speaker 1: those mortgages may not be as high.

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Speaker 2: Yes, absolutely, but also how the labor market is moving

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Speaker 2: in different regions, Because if you've got areas across the

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Speaker 2: country who are seeing either higher unemployment rates or again

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Speaker 2: just lower employment growth. Then you've got to have money.

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Speaker 2: You've got to have an income to be able to

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Speaker 2: afford a mortgagey payment, and if you haven't got that,

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Speaker 2: then that we're sort of added on starter. So you

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Speaker 2: could argue and see, for example, that Wellington might remain

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Speaker 2: a bit more subdued for longer because there are fewer

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Speaker 2: jobs that are coming through. You're seeing those public sector

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Speaker 2: cut backs, you're seeing the private sector who's not getting

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Speaker 2: as much government money either. That's all reducing job activity

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Speaker 2: in the Wellington region. So there is a whole lot

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Speaker 2: of moves there. One thing that I don't think we've

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Speaker 2: fully understood yet in the housing market, and we might

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Speaker 2: not for a couple of years, is also how the

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Speaker 2: very large number of houses that we've been building the

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Speaker 2: last couple of years will influence the market because all

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Speaker 2: of a sudden and over the last year or so,

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Speaker 2: you've been getting more of them coming onto the market.

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Speaker 2: You'll continue to see that over the next year or so.

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Speaker 2: There's a lot of houses that are being added to supply.

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Speaker 2: Also keep competition a bit higher than houses, which should

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Speaker 2: keep prices maybe a little bit more subdued. In the

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Speaker 2: past regardless, I mean the numbers you're looking at the

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Speaker 2: moment still suggest a housing market that is not going

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Speaker 2: to absolutely refire away as we get into twenty twenty five.

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Speaker 2: Even if there is a bit of upside coming.

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Speaker 1: Through, certainly doesn't feel like it. Brad Olsen infor Metrics.

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Speaker 1: Thanks so much for your time. It is for more

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Speaker 1: from News Talks EDB.

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