Say hello to the good buys
4:00AM Sunday Feb 08, 2009
Rebecca Lewis

It might be a recession, but for those who can afford the deposit the housing market is the most affordable it has been in four years.

The latest figures show the average home buyer will pay nearly $118 less per week on their mortgage.

Reduced house prices and tumbling mortgage rates mean buying a house is cheaper but the situation for those looking to sell remains grim.

The Home Loan Affordability series, compiled by economic commentator Bernard Hickey on Interest rates in New Zealand, shows interest rates, mortgage repayments and house prices have all fallen dramatically in the past year.

At the same time, take-home pay and disposable income have increased significantly for the average buyer.

In 2005 when interest rates were up to 9.3 per cent a couple paying $600 a week for an average $300,000 house was facing 18 years of payments.

Now, the average buyer - a person aged between 30 and 34 years old with a 20 per cent deposit - could pay $118 less per week on the mortgage. Average bank interest rates for a two-year fixed mortgage are down two per cent since December 2007.

More here.