Info on the NZ property market
#1
(Jon) returning to NZ 04
Thread Starter
Joined: Jul 2003
Posts: 816
Info on the NZ property market
Thought these articles about the current housing boom in NZ may be of interest to everyone. They include a couple of case studies at both ends of the Auckland market, as well as up and coming areas in Auckland, and the housing boom in Nelson. :
Case study 2: $380,000 buys a foot on the property ladder
27.09.2003
By BERNARD ORSMAN
Looking for the average home in Auckland City? Here it is. A four-bedroom, nicely renovated villa with polished floors in Selwyn St, Onehunga. Not the best address in this up-and-coming suburb, but a pretty entry level pad all the same.
The new owners, an English couple with two young boys, paid $385,000 this month for the sunny house with a modern kitchen and two bathrooms on a cross-leased section. Rest of article: http://www.nzherald.co.nz/storydispl...ondsubsection=
and
Also http://www.nzherald.co.nz/storydispl...ondsubsection=
and
http://www.nzherald.co.nz/storydispl...ondsubsection=
and
http://www.nzherald.co.nz/storydispl...ondsubsection=
Very interesting - just hope the market slows before we get there!
Case study 2: $380,000 buys a foot on the property ladder
27.09.2003
By BERNARD ORSMAN
Looking for the average home in Auckland City? Here it is. A four-bedroom, nicely renovated villa with polished floors in Selwyn St, Onehunga. Not the best address in this up-and-coming suburb, but a pretty entry level pad all the same.
The new owners, an English couple with two young boys, paid $385,000 this month for the sunny house with a modern kitchen and two bathrooms on a cross-leased section. Rest of article: http://www.nzherald.co.nz/storydispl...ondsubsection=
and
Also http://www.nzherald.co.nz/storydispl...ondsubsection=
and
http://www.nzherald.co.nz/storydispl...ondsubsection=
and
http://www.nzherald.co.nz/storydispl...ondsubsection=
Very interesting - just hope the market slows before we get there!
#2
Re: Info on the NZ property market
Originally posted by jandjuk
Thought these articles about the current housing boom in NZ may be of interest to everyone. They include a couple of case studies at both ends of the Auckland market, as well as up and coming areas in Auckland, and the housing boom in Nelson. :
Case study 2: $380,000 buys a foot on the property ladder
27.09.2003
By BERNARD ORSMAN
Looking for the average home in Auckland City? Here it is. A four-bedroom, nicely renovated villa with polished floors in Selwyn St, Onehunga. Not the best address in this up-and-coming suburb, but a pretty entry level pad all the same.
The new owners, an English couple with two young boys, paid $385,000 this month for the sunny house with a modern kitchen and two bathrooms on a cross-leased section. Rest of article: http://www.nzherald.co.nz/storydispl...ondsubsection=
and
Also http://www.nzherald.co.nz/storydispl...ondsubsection=
and
http://www.nzherald.co.nz/storydispl...ondsubsection=
and
http://www.nzherald.co.nz/storydispl...ondsubsection=
Very interesting - just hope the market slows before we get there!
Thought these articles about the current housing boom in NZ may be of interest to everyone. They include a couple of case studies at both ends of the Auckland market, as well as up and coming areas in Auckland, and the housing boom in Nelson. :
Case study 2: $380,000 buys a foot on the property ladder
27.09.2003
By BERNARD ORSMAN
Looking for the average home in Auckland City? Here it is. A four-bedroom, nicely renovated villa with polished floors in Selwyn St, Onehunga. Not the best address in this up-and-coming suburb, but a pretty entry level pad all the same.
The new owners, an English couple with two young boys, paid $385,000 this month for the sunny house with a modern kitchen and two bathrooms on a cross-leased section. Rest of article: http://www.nzherald.co.nz/storydispl...ondsubsection=
and
Also http://www.nzherald.co.nz/storydispl...ondsubsection=
and
http://www.nzherald.co.nz/storydispl...ondsubsection=
and
http://www.nzherald.co.nz/storydispl...ondsubsection=
Very interesting - just hope the market slows before we get there!
#3
Banned
Joined: Aug 2002
Posts: 7,613
Look before you leap with NZ property purchase. Certain areas (better parts of Chch, Nelson, Blenheim for starters S Island) look in full throttle bubble right now. Eg Nelson properties up 50% y-o-y. Not sustainable.
Nelson real estate agent told me they used to have 200 properties for sale on their books but now only have 30 (which he told me were generally disappointing - ie rubbish). Remember supply and demand?
All it takes is a fall back of 25% in property prices and a repositioning of the Kiwi dollar by 15% and you could be looking at big losses if you might convert back - or would have been better off waiting a bit.
Nelson real estate agent told me they used to have 200 properties for sale on their books but now only have 30 (which he told me were generally disappointing - ie rubbish). Remember supply and demand?
All it takes is a fall back of 25% in property prices and a repositioning of the Kiwi dollar by 15% and you could be looking at big losses if you might convert back - or would have been better off waiting a bit.
#4
(Jon) returning to NZ 04
Thread Starter
Joined: Jul 2003
Posts: 816
yes I'm praying for a crash around the end of 2004!
#5
Just Joined
Joined: Aug 2003
Location: Wellington
Posts: 28
But then local advice is saying that whilst the market may flatten, an outright slump is unlikely. There are definite property hotspots - Auckland, some parts of Wellington, some parts of Christchurch, Nelson and Marlborough, Queenstown Lakes, Martinborough. These are often linked to water views, access to wineries and overseas interest. The greater the number of immigrants and o/s investors who buy in these areas, the more sustainable the boom. And the further and further apart the market 'value' of property and its accessiblity to people who live their lives on Kiwi wages. There is also a belief that NZ property was undervalued in the first place in the international scheme of things and that some of the boom is a long overdue levelling. All know is that i have been offered a good job in Queenstown this week that i can't take as I know that I can't afford to buy even a modest place to live.
#6
Just Joined
Joined: Aug 2003
Posts: 28
Don,
You say "..All it takes is a fall back of 25% in property prices and a repositioning of the Kiwi dollar by 15% and you could be looking at big losses if you might convert back .." Do you think that this is likely?
Firstly - loss of 25% in property prices, all of the indicators at the moment point to a still rising property market. Low (by NZ standards) interest rates, attractiveness of NZ at the moment to foreigners and the influx of kiwi ex-pats and immigrants with plenty of wedge.
Secondly - repositioning of the kiwi dollar by 15%, although the more likely of the two scenarios is still unlikely. The low interest rates I spoke of earlier are at least a couple of percent higher than any other stable economies. This makes the kiwi dollar an attractive proposition for investors when worldwide stock markets are behaving so unpredictably. Therefore many analysts are predicting that the kiwi dollar will remain strong for the medium term (12 months) at least.
Add to the argument the fact that property in NZ has been undervalued for years, in world terms and I believe what we are seeing is a long overdue repositioning.
Very few people in NZ are predicting fall in house prices, many are predicting rises, though we may now be over the worst/best of it and some are predicting that the house prices will remain stable.
The price rises seen are unsustainable, but expect double digit growth for the next 12 months at least in the more attractive areas and probably double that for sea front properties.
I have seen first hand the property boom in Auckland as I have been trying to buy for the last 3 months and by waiting for the right house I have seen prices rise by approx. 20%. This is not an exaggeration, I was looking at $300k for a property and the same properties are now going for $350k.
So you may lose out by taking the plunge, but you may also lose out by not, so what do we do???? who knows
You say "..All it takes is a fall back of 25% in property prices and a repositioning of the Kiwi dollar by 15% and you could be looking at big losses if you might convert back .." Do you think that this is likely?
Firstly - loss of 25% in property prices, all of the indicators at the moment point to a still rising property market. Low (by NZ standards) interest rates, attractiveness of NZ at the moment to foreigners and the influx of kiwi ex-pats and immigrants with plenty of wedge.
Secondly - repositioning of the kiwi dollar by 15%, although the more likely of the two scenarios is still unlikely. The low interest rates I spoke of earlier are at least a couple of percent higher than any other stable economies. This makes the kiwi dollar an attractive proposition for investors when worldwide stock markets are behaving so unpredictably. Therefore many analysts are predicting that the kiwi dollar will remain strong for the medium term (12 months) at least.
Add to the argument the fact that property in NZ has been undervalued for years, in world terms and I believe what we are seeing is a long overdue repositioning.
Very few people in NZ are predicting fall in house prices, many are predicting rises, though we may now be over the worst/best of it and some are predicting that the house prices will remain stable.
The price rises seen are unsustainable, but expect double digit growth for the next 12 months at least in the more attractive areas and probably double that for sea front properties.
I have seen first hand the property boom in Auckland as I have been trying to buy for the last 3 months and by waiting for the right house I have seen prices rise by approx. 20%. This is not an exaggeration, I was looking at $300k for a property and the same properties are now going for $350k.
So you may lose out by taking the plunge, but you may also lose out by not, so what do we do???? who knows
#7
Banned
Joined: Aug 2002
Posts: 7,613
Originally posted by Bladesman
Don,
You say "..All it takes is a fall back of 25% in property prices and a repositioning of the Kiwi dollar by 15% and you could be looking at big losses if you might convert back .." Do you think that this is likely?
Firstly - loss of 25% in property prices, all of the indicators at the moment point to a still rising property market. Low (by NZ standards) interest rates, attractiveness of NZ at the moment to foreigners and the influx of kiwi ex-pats and immigrants with plenty of wedge.
Secondly - repositioning of the kiwi dollar by 15%, although the more likely of the two scenarios is still unlikely. The low interest rates I spoke of earlier are at least a couple of percent higher than any other stable economies. This makes the kiwi dollar an attractive proposition for investors when worldwide stock markets are behaving so unpredictably. Therefore many analysts are predicting that the kiwi dollar will remain strong for the medium term (12 months) at least.
Add to the argument the fact that property in NZ has been undervalued for years, in world terms and I believe what we are seeing is a long overdue repositioning.
Very few people in NZ are predicting fall in house prices, many are predicting rises, though we may now be over the worst/best of it and some are predicting that the house prices will remain stable.
The price rises seen are unsustainable, but expect double digit growth for the next 12 months at least in the more attractive areas and probably double that for sea front properties.
I have seen first hand the property boom in Auckland as I have been trying to buy for the last 3 months and by waiting for the right house I have seen prices rise by approx. 20%. This is not an exaggeration, I was looking at $300k for a property and the same properties are now going for $350k.
So you may lose out by taking the plunge, but you may also lose out by not, so what do we do???? who knows
Don,
You say "..All it takes is a fall back of 25% in property prices and a repositioning of the Kiwi dollar by 15% and you could be looking at big losses if you might convert back .." Do you think that this is likely?
Firstly - loss of 25% in property prices, all of the indicators at the moment point to a still rising property market. Low (by NZ standards) interest rates, attractiveness of NZ at the moment to foreigners and the influx of kiwi ex-pats and immigrants with plenty of wedge.
Secondly - repositioning of the kiwi dollar by 15%, although the more likely of the two scenarios is still unlikely. The low interest rates I spoke of earlier are at least a couple of percent higher than any other stable economies. This makes the kiwi dollar an attractive proposition for investors when worldwide stock markets are behaving so unpredictably. Therefore many analysts are predicting that the kiwi dollar will remain strong for the medium term (12 months) at least.
Add to the argument the fact that property in NZ has been undervalued for years, in world terms and I believe what we are seeing is a long overdue repositioning.
Very few people in NZ are predicting fall in house prices, many are predicting rises, though we may now be over the worst/best of it and some are predicting that the house prices will remain stable.
The price rises seen are unsustainable, but expect double digit growth for the next 12 months at least in the more attractive areas and probably double that for sea front properties.
I have seen first hand the property boom in Auckland as I have been trying to buy for the last 3 months and by waiting for the right house I have seen prices rise by approx. 20%. This is not an exaggeration, I was looking at $300k for a property and the same properties are now going for $350k.
So you may lose out by taking the plunge, but you may also lose out by not, so what do we do???? who knows
The old advice about feeling confident about property purchase if you like the place and think it's appropriate value and won't need to sell for a few years - holds good. But anybody wanting to make capital gains or just preserve the value of the house/asset they have bought now needs to be more careful than 2 years ago. Time perspective could be key.