Tony Alexander warns real estate agents that many will need to find new jobs
A leading economist has issued a grim warning to the real estate industry that a plunge in sales will mean many will need to find new jobs.
In his weekly newsletter, BNZ chief economist Tony Alexander said the bank had been "subtly" trying to get the message to the industry regarding employment levels.
"Perhaps a few missed it, so here it is in black and white. Many of you in the coming year will have to find something else to do."
According to his figures in the year to June 30, 2016, 95,000 houses were sold by registered agents, while in the 12 months to July 2017, that number had eased to 80,000.
BNZ warned that the number of sales would continue to fall.
"The chances are that within a year or so the annual number will be near 65,000 with downside risk," Alexander said.
While previous housing downturns had seen annual sales in New Zealand drop to 55,000, Alexander said the fall this time was unlikely to be that hard.
"From here we expect further tightening of lending criteria, some easing in net migration inflows, little movement in interest rates, but continued strong economic and jobs growth."
Earlier this week Chris Kennedy, chief executive of real estate agency Harcourts warned that the looming election was having an impact on sales, but it was "undeniable" that the housing market was slowing. New listings in August were down by more than a fifth on the same month a year ago.
"[T]here has been a general slowing in the housing market across New Zealand, and particularly in Auckland, due to Reserve Bank restrictions and a sharp decline in the number of foreign buyers."