Auckland's next house price boom could be on the verge of taking off, leading to warnings to first-home buyers to buy now or risk being locked out of the market forever.
Record low interest rates, an ongoing housing shortage, relatively high migration into the city and growing investor confidence loom as a potentially irresistible tide pushing prices up.
It's led economists from Westpac bank to tip Auckland house prices to jump 5 per cent next year and then 7.5 per cent in 2021.
Westpac chief economist Dominick Stephens said the past two or three boom cycles had all followed on from banks suddenly dropping the interest-rate fees they charged for home loans.
"That's what we've seen now, another sudden reduction in mortgage rates and that is why we are going to see a lift in house prices," he said.
Any new jump in prices would likely be welcomed by home owners but could spell disaster for first-home buyers.
It also contrasts with a current market that has turned cold on the back of gently falling prices over the past two years and an especially wet and dreary winter.
Buyers were also spooked last year by stories of market crashes in Australia and tales of Sydney house prices falling up to 20 per cent.
But despite the gloom Auckland house prices have yet to take a major tumble, kept afloat by the low interest rates, housing shortage and high migration levels.
These strong underlying forces were now set to be bolstered by a growing market confidence that would help propel prices up, Stephens said.
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Investors in particular were likely to be buoyed by the end of talk about a capital gains tax and a desire to put their cash to work given other money-making tools, such as term deposits, were delivering low returns.
But he cautioned the coming price jump wouldn't be as "extreme" or "vigorous" as the past two or three boom cycles.
This was because there would not be as strong a demand as in the past because most foreign buyers had been banned from the market and investors were facing increased taxes and regulations.
Colliers International residential property expert Peter Evans also tipped a new price boom to start in 2021 and said it was likely to leave first-home buyers as mere spectators.
"First-home buyers won't be able to get into the market in two to three years' time," he said.
First-home buyers had already found it "almost impossible" to buy at the height of the last boom in 2015 and 2016, when many homes were sold at auction and they found themselves outbid by buyers with deeper pockets.
This would only be exacerbated in a coming boom because rising house prices would be starting from such a high base, Evans said.
First-home buyers also often had a lack of choice in boom periods due to developers building higher-priced homes and townhouses rather than more affordable properties in a bid to maximise their profits.
Further adding to their challenges was a prediction by Ashley Church - a columnist with property site OneRoof - that the next boom could last through to 2026-27, with prices jumping by 70-100 per cent.
OneRoof editor Owen Vaughan said there were already signs of the "fear of missing out" or "fomo" mindset creeping back after recent auctions had produced some tough bidding wars.
"It's likely there will be wave of first-home buyers who have no experience of what auctions were like during the boom years, and will find themselves outbid on properties that they may have thought were in their price range," Vaughan said.
He warned would-be buyers to do their due diligence before turning up to auctions to "avoid being trapped in a costly and demoralising cycle".
THE STREETS WHERE FIRST-HOME BUYERS AND INVESTORS ARE BUYING
First-home buyers have spent the past two years clawing their way back into a position to buy Auckland houses again.
Having been priced out of the market during the boom years, they took advantage of falling prices since to become the city's dominant buyer group again.
Now new data by analysts OneRoof-Valocity shows Nelson St in Auckland Central has been the most popular spot for first-home buyers to purchase.
They snapped up 41 properties in apartment complexes on Nelson St in the past 12 months.
Apartments on the street sell for a median price of $325,000.
Union St in the city centre was the next biggest seller, with 33 properties going to first-home buyers.
A new development on Kimiora St in Three Kings was the next most popular, with 25 purchases.
Other first-home buyer hotspots included Mapou and Rangihina Rds in West Harbour, Royal Rd in Massey, Dignity St in Takanini and Beach Haven Rd in Beach Haven.