Property Insights

Understanding the Implications of the 2024 Budget for New Zealand’s Property Market

June 17, 2024

Understanding the Implications of the 2024 Budget for New Zealand’s Property Market

Tony Alexander's latest property review offers a deep dive into the recently announced 2024 Budget and its potential impact on the New Zealand economy and property market. As we dissect these insights, it’s essential to understand how they could influence your investment decisions, particularly in the realm of new build properties.

Key Takeaways from the 2024 Budget

Fiscal Deficit and Debt Management

The Budget indicates a move towards fiscal tightening, aiming to achieve a surplus by mid-2028, sooner than previously projected. However, recent economic forecasts have downgraded the outlook for productivity growth, reflecting ongoing challenges in boosting the country's economic performance. This tighter fiscal policy suggests a cautious approach to spending and investment, which could affect both the property market and broader economic conditions.

Inflation and Reserve Bank’s Role

While the Budget includes measures that exert slight downward pressure on inflation and growth, these are not significant enough to influence the Reserve Bank’s monetary policy substantially. The anticipated adjustments are expected to keep the Reserve Bank on its current path, with potential interest rate cuts predicted for later in the year. This outlook can be favourable for property buyers and investors as borrowing costs may stabilise or decrease, making new build investments more accessible.

Housing Market Dynamics

Despite changes aimed at encouraging rental property provision, such as the adjustment to the brightline test and restoration of interest expense deductibility, the Budget does not introduce significant measures to improve housing availability for average Kiwis. This status quo could maintain the attractiveness of new build properties, which continue to meet the demand for modern, energy-efficient homes that comply with the latest building standards.

Economic Impact

The Budget’s slight negative fiscal pulse is expected to dampen economic growth in the short term. Treasury's optimistic growth projections face challenges, particularly in light of potential external economic shocks and domestic constraints like workforce shortages and rising costs. Investors should remain vigilant and consider these factors when planning long-term investments in the property market.

Business and Investment Climate

For businesses, the Budget does not offer significant tax changes or incentives for capital expenditure and innovation. This neutrality means that businesses and property investors must continue to navigate the market with careful planning and strategic investments. The anticipated reduction in public sector spending may lead to a leaner government presence in the economy, which could benefit private enterprise over the long term.

What Does This Mean for New Build Property Investments?

Stable Financing Environment

With the potential for interest rates to stabilise or decrease by the end of the year, new build properties become an attractive option. Lower borrowing costs can make financing more manageable, allowing more buyers to enter the market.

Demand for Modern Living

The emphasis on new builds aligns with the growing demand for homes that meet contemporary living standards. These properties offer lower maintenance costs, energy efficiency, and compliance with current regulations, making them a smart choice for investors and homebuyers alike.

Navigating Economic Uncertainties

Investors should be aware of the broader economic uncertainties and plan their property purchases with a long-term perspective. The insights from Tony Alexander highlight the importance of staying informed and adaptable in a changing economic landscape.


For those considering investing in new build properties, understanding these dynamics is crucial. The potential for stabilised interest rates, combined with the enduring appeal of modern, low-maintenance homes, positions new builds as a compelling investment choice.

At KEY2 Real Estate, we are committed to guiding you through these complexities with expert advice and personalised service. Whether you’re a seasoned investor or a first-time buyer, we’re here to help you make informed decisions that align with your goals.

For a detailed look at Tony Alexander’s insights and how they could impact your property investments, read his latest review here.


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