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A season for sitting on our hands

It is usual practice in the weeks before a general election for the voting population to sit on their hands and wait.

It’s an otherwise uncharacteristic type of caution that surfaces just for elections. The writing of the election outcome could be clearly seen on the wall, but observers will still prefer to take a spot on the sideline, rather than make what they believe to be an important decision. That decision could be as insignificant as whether to purchase a second-hand lawn mower or something more substantial, such as a new fridge. Whatever the item might be, we just don’t feel confident enough in our decision-making, till the big decision on who to vote for has been made by the public.

An increasing number of polls makes things worse. The results of said polls add to the uncertainty and keep us at arm’s length from any big decisions. Our MMP electoral system and the very real possibility of a period of post-vote negotiations are not particularly helpful either.

There is a peculiar dance currently going on in the Beehive. The staff of the various portfolio ministers or government departments and others that keep the political cogs turning are busy jockeying for a position of prominence so that a new minister will notice them should there be a change of administration. The more seasoned staffers among them have been there and done that several times and know their skills will be highly sought-after, by whoever wins the seat of power. Still, it’s an anxious time for the minions.

Curious then, among all this uncertainty, that a new collection of statistics from the property sector seems to indicate that the housing market is looking a bit more like its old self. And by old, I mean the market about a decade ago, when it was getting back to its feet, dusting itself off and starting the edge forward again. Purchasing a house, particularly in the current market, is no small matter.

Putting the debate about whether foreign buyers are going to underpin National’s tax revenue plan to one side for a moment, there appears to be a view that it might be a good time to dip one’s toe into the housing sector again.

According to the latest mortgage lending data from the Reserve Bank of New Zealand, the market showed some sign of life in August.

The nation’s banks issued $5.8 billion of mortgages in August – 15.7 per cent more than in July and 6.8 per cent more than in August last year. Interestingly, it was the first time in two years that the value of new mortgage lending during the month was greater than the same month the previous year. That said, the latest number was still 29 per cent below what it was when the property market was red-hot in August 2021.

Economists have warned would-be property owners eyeing a turn in the market. “If upside housing pressures result in upside inflation pressures, the RBNZ is likely to respond with cash rate hikes, stopping the housing upswing in its tracks,” they said.

Perhaps the sidelines will not empty in a rush just yet.

Roger Parker
Roger Parker
Roger Parker is the Times-Age news director. In the Venn-diagram of his two great loves, news and sport, sports news is the sweet spot.

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