Chimerica

NZ House Sales Worst in 18 Years

11 posts in this topic

Is this the start of the rot that will spread to our shores?

http://news.smh.com.au/breaking-news-business/nz-house-sales-data-worst-in-18-years-20100212-nw0j.html

House sales plummeted last month to their lowest level in nearly two decades, says the Real Estate Institute of New Zealand (REINZ).

Just 3666 homes sold in January this year, the lowest monthly total since electronic records began in 1992 and only the second time the total figure has dipped under 4000.

"Activity in the residential property market was quiet last month on the back of uncertainty over what actions the Government intended to take on the recently announced Tax Working Group recommendations," said REINZ president Peter McDonald.

However, he hoped the market would pick up after Prime Minister John Key this week ruled out proposals to introduce a land tax, comprehensive capital gains tax or new tax on residential investment properties.

The total value of residential sales, including sections, in New Zealand in January was $1.53 billion. January's total of 3666 was 40 fewer houses than were sold in January 2009 and 1291 down on December 2009.

The national median residential house price of $350,000 was up 7.7 per cent on the corresponding figure of $325,000 for January 2009, but was $10,000 down on the median price for December 2009.

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Is this the start of the rot that will spread to our shores?

http://news.smh.com....00212-nw0j.html

However, he hoped the market would pick up after Prime Minister John Key this week ruled out proposals to introduce a land tax, comprehensive capital gains tax or new tax on residential investment properties

the NZ media are such light weights - don't they realise who pays the bills? in australia this would be...

After the prime minister this week ruled out draconian legislation property was set to increase 15% in value this year....

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"However, he hoped the market would pick up after Prime Minister John Key this week ruled out proposals to introduce a land tax, comprehensive capital gains tax or new tax on residential investment properties."

Why is it that they know exactly what they should be doing here and in Kiwiland and yet they refuse to. Pretty dumb as these recomendations will be on record for all to see in years to come.

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"However, he hoped the market would pick up after Prime Minister John Key this week ruled out proposals to introduce a land tax, comprehensive capital gains tax or new tax on residential investment properties."

Why is it that they know exactly what they should be doing here and in Kiwiland and yet they refuse to. Pretty dumb as these recomendations will be on record for all to see in years to come.

Because these things are structural changes that will only see a dividend over 2 or more terms.

House prices rising increase consumption. House prices falling reduce consumption.

Low house prices over time mean people have more money in there pockets to consume. High house prices over time mean people have less money to consume.

This is the irony in the short term rising house prices are good for the national dividend, but the result of rising prices, high house prices given time will mean increasing debt levels and lower consumption than would occur in a society with cheaper dwelling costs.

In the short term there is no question that a falling housing market will result in shrinking GDP, and possibly deflation. These things are not good for the economy, but sooner or later we will have to go through this structural adjustment. Teh longer we wait the more extreme the contraction will be when it happens.

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the NZ media are such light weights - don't they realise who pays the bills? in australia this would be...

After the prime minister this week ruled out draconian legislation property was set to increase 15% in value this year....

Good call- I love it! So sick of mainstream propoganda

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The figure is probably worse than it seems. I am guessing the population/number of houses is much higher now than 20 years ago so if you adjusted the figure to take this into account then it may be the worst in... perhaps, 80 years?

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A market standoff.

The buyers won't go up to meet the sellers. The sellers won't go down to meet the buyers. Voila, volumes down.

You need a tipping point. Economic good times, an increase in M3, and easy credit for the buyers or a situation forcing sellers to sell (eg selling one property to payoff another, consumers ceasing to discretionary consume forcing businesses to fold, unemployment increasing following a credit freeze to business etc).

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Good call- I love it! So sick of mainstream propoganda

" i really feel for the first home buyers, the ones who've almost missed out" said rumple, ceo of s&s.

with prices set to rise sharply and interest rates on the way up there is little precious time left for those trying to get their foot on the property ladder.

"extensive research indicates that first time buyers have only a few months to get into the market before they are priced out; forced to live in the rental trap forever"

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A market standoff.

The buyers won't go up to meet the sellers. The sellers won't go down to meet the buyers. Voila, volumes down.

You need a tipping point. Economic good times, an increase in M3, and easy credit for the buyers or a situation forcing sellers to sell (eg selling one property to payoff another, consumers ceasing to discretionary consume forcing businesses to fold, unemployment increasing following a credit freeze to business etc).

Tin,

I think most govs are hopeing for stabilization and sidways movement for a long time rather than further growth or a sudden contraction. Only problem is that this balancing act is like having two girlfriends at the one time. It not possible to keep it up for long before something goes wrong! My wife may read this so no questions please.

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Low house prices over time mean people have more money in there pockets to consume. High house prices over time mean people have less money to consume.

+ 1

Seriously, are all our collective political, community and business leaders so short sighted?

I believe that during the Gangsters Hay Day that they had the foresight to leave those that they stood over enough so that they could continue trading and it was still worth their while to continue trading. I read that the Russian Gangsters weren't as smart and they took everything and of course their victims closed up shop.

The Housing Bubble would have FTB's paying most of their money on mortgage payments leaving very little to invest, put away for retirement, spend within their community etc etc. Surely this wouldn't be very good for the community / local economy :wacko:

Then WTF would I know? My personal contribution to the local community is very limited as I'm building my deposit :flex:

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A market standoff.

The buyers won't go up to meet the sellers. The sellers won't go down to meet the buyers. Voila, volumes down.

You need a tipping point. Economic good times, an increase in M3, and easy credit for the buyers or a situation forcing sellers to sell (eg selling one property to payoff another, consumers ceasing to discretionary consume forcing businesses to fold, unemployment increasing following a credit freeze to business etc).

When I went back to my hometown a couple years back there was a common talk of rates. People were majorly pissed that their houses had gone up because their rates sky rocketed.

Different outlook in my town to Sydney anyway. I didn't once hear "oh my house has increased in value".

The local council actually had a front page article on their website about why the rates had gone up so much, from memory it was like 40% or so for most people in the area (old fishing village full of retirees, fishermen, bikees, alternate lifestylers and artists) of town I am from where the valuations had jumped the most.

Everyone I knew blamed the rich out of towners wanting to "invest". In the next breath they asked what these people were investing in "a barbecue chicken shop on a beach you can't swim at?" This was quickly followed with "and the council are just trying to fleece them".

If I was early twenties while that happened I wouldn't have bought a house after hearing my parents bitch about that either... Could be a couple "investments" going south there.

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