A net 34 percent of people surveyed expected prices to rise from levels seen in the quarter, compared to the start of the year. (file image) Photo: RNZ / Marika Khabazi
Households believe the market has reached a turning point, with more people expecting prices to increase, according to ASB's latest housing confidence survey.
For the first time in 18 months, more New Zealanders expected prices to increase than decrease, the survey for the three months to October showed.
A net 34 percent expected prices to rise from levels seen in the quarter, compared to the start of the year, where 43 percent expected prices to fall.
"Aucklanders continue to be the most bullish in their house price expectations, in a continuation of the theme we saw last quarter," ASB said.
However, households were split on whether it was a good time to buy, with a net 6 percent agreeing that it was a good time to buy.
ASB said the survey took place during the election campaign, which was a time of "heightened uncertainty".
"New Zealand housing affordability remains woeful by any historical standard, but some hopeful Kiwis might be figuring that after a 16 percent peak-to-trough fall in prices and some decent wage growth, there won't be a better time to try and cobble together the cash for a deposit," it said.
A net 28 percent expected a further increase in interest rates, but only 15 percent believed rates would fall.
"The biggest shift continues to be the number who expect rates to move sideways, up four-fold over the year-to-date," ASB said.
"That tends to be the camp we're in too - while we don't anticipate any further OCR [official cash rate] hikes at this stage, we think it'll be at least another nine months before the RBNZ [Reserve Bank] is comfortable loosening policy up."