21 Jul Property and Migrants | Immigration
This article relation to the property market and immigration was sourced for you by Auckland law firm Quay Law
Migrants fuel hot housing market
Last updated 20/07/2013
New Zealand is experiencing its biggest gain in net migration for four years, which will put more pressure on already rapidly rising house prices in regions such as Auckland and Christchurch.
Some economists warn that rising migration may add to the “hysteria” about house prices in Auckland, while others said people buying homes in Auckland should be aware prices could just as easily drop 10 per cent because they were so over-valued.
The BNZ said rising net migration might fuel an “already excited” housing market in some parts of the country, like Auckland.
“Is it [stronger migration] a reason for house prices to be that high and keep going up? Probably not but it just comes at a bad time,” BNZ senior economist Craig Ebert said.
The Reserve Bank had flagged the rising levels of migration in recent months and as the numbers pushed higher, they would come on to the Reserve Bank’s radar, Ebert said.
“This [migration] may prod the Reserve Bank on interest rates.
“It could be the cause for them to move on interest rates, sooner rather than later,” he said.
Statistics New Zealand figures out yesterday showed that overall, 2300 more people arrived to stay here long-term, than left the country in June alone.
That was the highest monthly net gain since mid-2009, before the big Canterbury quake sparked a rush of people leaving for Australia.
Rising migration would boost overall spending but would put extra pressure on demand for housing, economists said.
TD Securities head of research Annette Beacher said the Reserve Bank should lift official interest rates by the end of the year because of the mounting pressures on houses.
If the pace of net migration of the past three months continues for a year, the total would top 23,000, well above the long-run average.
Net migration is picking up, with the flood of people leaving for Australia slowing to a steady stream.
There has also been a clear pick-up in New Zealanders returning from Australia in the past 18 months.
That is because New Zealand’s economy is looking better, because of the Christchurch rebuild and high and even rising dairy export prices.
In contrast, Australia’s economy is cooling down.
And because recent Kiwi arrivals in Australia do not qualify for social welfare, they may be choosing to come home if they lose their jobs.
The net gain in the past year was almost 8000.
Monthly net migration gain in June 2013: 2300, the highest since May 2009
More people are arriving and fewer have left for Australia in the past six months.
Seasonally adjusted net loss to Australia: 1600, the smallest level since mid-2010
Year to June Net migration gain of 7900, reversing a net loss of 3200 in the year to June 2012
Annual average for the past decade: 9400.
Record annual net gain: 42,500 in 2003
Total arrivals in June year: 88,200 (up 5 per cent from previous year).
Total departures: 80,300 (down 8 per cent).
Net annual loss to Australia: 31,200 (39,800 a year earlier).
In both directions across the Tasman, most migrants are New Zealanders
Net annual gain: other countries: Britain: 6300 net gain China: 5200 India: 5100 The Philippines: 2000
Source: Statistics NZ
– © Fairfax NZ News