Why Savvy Investors Are Making Their Move Before The Election

While many would-be investors are waiting for the General Election to provide some degree of certainty, experienced buyers are quietly making their move now. They know too well that markets move before confidence returns, and that by the time everyone feels comfortable, many of the best opportunities have gone.

That was a key theme when Lodge City Rentals recently hosted ANZ Chief Economist Sharon Zollner for an exclusive evening event with investors. Her presentation pointed to an economy that is gradually healing, even if the headlines still focus on uncertainty.

Sharon described the New Zealand economy as moving through a familiar cycle of boom, bust and now recovery. She noted that while growth has been uneven, many of the excesses created during the post-Covid period have now been worked through. For example:

• Inflation has come down.
• Mortgage rates have done their job.
• Households are borrowing less.
• Farmers have reduced debt.
• House prices have become more affordable in real terms.
• The external deficit has narrowed.

Those are generally healthy long-term developments that suggest the structural imbalances that worried economists two years ago have already been corrected, providing sound foundations.

Uncertainty has not disappeared. Oil prices remain the biggest wildcard and have interrupted what had been a steadily improving recovery. But uncertainty is not unusual - whether it is elections, inflation, global conflict, pandemics or interest rates, there is almost always something investors can point to as a reason to wait.

Sharon also discussed where interest rates are likely to head next. ANZ expects the Reserve Bank could lift the Official Cash Rate (OCR) twice more in 2026, although that will depend largely on what happens to inflation, particularly if oil prices remain high. The key

message wasn't that interest rates will continue rising for years, but that they are getting closer to what economists consider a "normal" level.

For property investors, the more important point is that the market doesn't wait for official announcements. Buyers and sellers tend to adjust their behaviour based on what they expect will happen. By the time interest rates are certain, property prices have often already begun to move, which means those who wait for complete certainty miss the best buying opportunities.

Sharon also note that while house sales remain fairly slow and house prices have changed very little this year, they have held up better than anticipated. Sharon said there it’s now looking like values will be staying flat or even rising slightly instead of falling. Rents have also stabilised after a brief period of decline.

For investors, these are favorable conditions because it means they have more time to research properties carefully, negotiate with vendors and make considered decisions, rather than feeling pressured to act quickly.

The investors we work with at Lodge City Rentals are not trying to perfectly time the market - they know the exact bottom or top is almost impossible to predict. Instead, they focus on quality assets that stack up over the long term. They understand that governments change and interest rates rise and fall, but well-located residential property will continue to build wealth over the long term.

The General Election will undoubtedly create plenty of headlines over the coming months. Investors can expect renewed debate about issues such as property tax settings, planning and housing supply reforms, infrastructure funding, foreign buyer rules, and whether lending restrictions should become tighter or looser. Whatever the final policies, there will be no shortage of commentary predicting winners and losers.

The investors we work with at Lodge City Rentals aren't trying to predict every twist in the market. They focus on buying quality investment properties that deliver sustainable returns over many years, regardless of which party forms the next government. They understand that governments change, interest rates rise and fall, but well-located residential property has consistently rewarded those who take a disciplined, long-term approach.

No one can predict exactly what the next 12 months will bring. What investors can control is buying well, undertaking thorough due diligence and making decisions based on long-term fundamentals rather than short-term headlines. That's the approach that has consistently built wealth through every stage of the property cycle