Westpac: Housing market “to skid to a halt” on virus

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Westpac New Zealand has released analysis on the economic impacts of the coronavirus, which forecasts that New Zealand’s “currently rampant” housing market will “skid to a halt” over the second quarter. However, it will rebound from 2021 as monetary stimulus bites:

The currently rampant housing market is likely to skid to a halt, with price growth slowing sharply in the June quarter. That, combined with job losses and lower farm and business incomes, will have a secondary impact on consumer spending that could last longer than the immediate disruption from the virus…

The Reserve Bank will be keen to ensure that it does not fall too far out of sync with its peers, lest the exchange rate rise unhelpfully.

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About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.