17 Sep 2020

ASB economist not sure about PREFU housing prediction

From Morning Report, 6:38 am on 17 September 2020

The Covid-19 pandemic has failed to dent New Zealand's love affair with property, embarrassing the best guesses of many economic forecasters.

But now Treasury says a dip is coming and claimed in its pre-election update that house prices will fall 5 percent on average by the middle of next year.

The government's main economic advisor cites a lack of immigration and a rise in jobless - saying an upward trajectory won't start again until the borders reopen.

Those talking up the market say a short a dip is unlikely, noting a lack of supply and historically low borrowing costs.

Reporter Katie Todd asked ASB chief economist Nick Tuffley if the Treasury's forecast is on the money.