8 Dec 2011

First-time home buyers entering market

7:38 am on 8 December 2011

BNZ chief economist Tony Alexander says a wave of first home buyers are entering the market after a long stretch of bleak financial times.

Some 29% of 435 agents surveyed by the Real Estate Institute reported they are dealing with more first home buyers.

Mr Alexander says younger people have been putting off buying a home during the last few years because of the economic downturn but are now making their move.

But they are now making their move prompted, he believes, because they see the labour market slowly improving and have managed to build up a deposit or pay down debt.

Mr Alexander says others may also be hearing talk of property shortages and feel they should move now.

And he expects the first-home buyer share of the market to continue to grow, with investors in property more cautious in the face of developments such as the change in depreciation rules and the prospect of capital gains not what they had thought when they bought a few years ago.