Tough new mortgage lending rules have seen house prices dip in suburbs that usually appeal to first-time buyers. But that means bargain prices for investors and those with big deposits.
Property consultant Matthew Gilligan said there had been a "mini crash" in South Auckland, and other cheaper areas would also be affected.
CoreLogic statistics show that since the introduction of new loan-to-value-ratio lending rules in October, first-home buyers have dropped out of many parts of Auckland where they used to dominate.
Banks must now lend no more than 10 per cent of new loans to people with a deposit of less than 20 per cent, and many have been doing only half that. Before the rules were introduced, up to a quarter of new lending was to people with small deposits.
In Massey, West Auckland, the proportion of first-time buyers has dropped from 39 per cent to 29 over the past few months, and Glendene from 33 per cent to 15.
In South Auckland, Mangere's proportion of first-time buyers dropped from 35 per cent to 14.
The latest Real Institute Institute statistics show sales were down 7.6 per cent in February compared to the year before, but the number of sales for less than $400,000 dropped 17.7 per cent.
Already there are signs of price decline. Glendene's February median price was $485,000, down from $514,000 in October, and Panmure's dropped from $575,000 in October to $508,500 in February.
Property commentator Olly Newland had two clients who bought entry-level properties to do them up and sell, but were stuck with them.
"People can't come up with 20 per cent. Even on a $350,000 property, $70,000 is a hell of a lot for a young couple to put together."
Real Estate Institute chief Helen O'Sullivan said investors who used equity in their existing properties to buy new ones had also been slowed by the bank rules.
Regional centres have also noticed a marked decline in sales. Hamilton, Rotorua and Napier reported drops of about 5 per cent in first-home buyer participation.
Four years spent redecorating and landscaping, so where are the buyers?
Andy Morrison is surprised at how little interest there has been in his freshly renovated Glendene house since he listed it for sale.
He moved into the four-bedroom home just over four years ago and has spent the time since redecorating inside and out, and landscaping the 809 sq m section.
Morrison put the Millbrook Rd property on the market a couple of weeks ago, inviting inquiries at $579,000 or more.
But only a couple of families have been to the open homes, even though it is next to a school.
"I think it's because of the lending restrictions, and the impending interest rate rises."
A vendor in Massey, who declined to be identified, said the lending restrictions had hit the wrong end of the market. "It's made the low end of the property market die. Lower-priced properties aren't selling at all."
He had reduced the price of his property to just under $400,000, but there were still no takers.
Buyer Kenrick Smith is looking for a first home, and said he had noticed a change in the market. "Things seem to be getting worse for sellers and better for buyers."