Young people may be starting to give up on their dreams of owning a first home - at least for now, according to the latest BNZ-REINZ residential market survey.
The August survey, which attracted a low response of 253 estate agents, produced a record low of 18% of respondents reporting that they had been seeing more first-time buyers in the market.
That's a sharp drop from 28.4% in the previous month and goes against an average figure across the life of the survey of 34%.
BNZ chief economist Tony Alexander said the latest result continued a downward trend seen since March.
The result comes as the Government attempts to ease the way into the market for first time buyers by relaxing the requirements for them to get into homes.
But it also comes at a time when the Reserve Bank is believed to be on the brink of announcing some sort of "speed limits" on high loan to value lending - a category into which first time buyers normally fall. See here for articles on LVRs.
The Government's $64 million package for first home buyers came after it had first attempted to get the RBNZ to exclude first-time buyers from the LVR restrictions.
Alexander said the latest survey result appeared to "run counter" to the argument some have put forward that first home buyers have flooded the market the past few weeks in order to secure a loan before new Reserve Bank rules come into force.
"However, given some evidence that banks have already tightened their high loan to value lending in anticipation of the rule change this result may reflect first home buyers starting to give up on their home ownership dreams for now," he said.
In this survey the agents were asked in what ways they thought low-deposit house buyers would look to get around the new RBNZ limits.
"Overwhelmingly, the expectation is that they will get money, guarantees, or direct equity participation from parents," Alexander said.
"The second highest expected option is extra finance from second tier (more expensive) lenders."
According to the survey record numbers of respondents are seeing the current market as one for the sellers, with a net 26% reporting this, up from the previous high of a net 24.4% just a month ago.
Alexander said that in contrast with the previous two months when agents noted a falling away of potential vendors asking for valuations, this month there has been an improvement, but only to a net 0%.
"Our BNZ Business Survey contained over two pages of responses from people in the residential real estate sector telling us that listings are scarce however and getting scarcer," he said.