paddy234

Me and my girlfriend are keen on buying a house in Christchurch however I won't be able to access my kiwisaver and kiwisaver grant until August as I will have been In for three years at that point. I was wondering what people's thoughts on the current house prices here and do you think they will go up or down?

Honestly I think they are still too expensive but you get the feeling from people and the media that it's flatlined and will only go up from here, the average house price in Christchurch is $480,000. The average salary is $50,000 so in reality the average house is nearly five times a joint salary. We have looked around a few open homes to give us a general idea of size and what we could afford on our budget and even in areas like Linwood and Aranui on tc3 land they were seeking near $400,000. This is in areas with an very high crime rate and a less than impressive school system. I've been a bit disheartened by the whole thing to be honest but will keep saving a see how it goes in the coming months.

escapedtonz

only my opinion, but I reckon house prices will continue to rise for a while yet.

Are you certain you can use funds in Kiwisaver...is it your first ever home in NZ or any other country for that matter ?
If not, have you checked that you meet the criteria to withdraw the funds as a second home owner ?

paddy234

I haven't checked yet for pre approval however this will be my first home anywhere and we both meet all the criteria. We have only just started getting serious about it so only starting to do the research heavily now. Also I see a rise in 95% mortgages especially with new homes and I even know a lad who has a 100% mortgage, this to me already spells trouble

escapedtonz

You shouldn't have any issues then so long as you've been in the Kiwisaver scheme for at least 3 years. I'd still advise you to check with your investment provider though at an early stage, even if it's just to find out the process of actually applying to withdraw the funds and the likely timescales from application to your solicitor receiving the funds through IRD.
Not really looked that much in to mortgages yet even though we are at the verge of purchasing a section so we can build. We've picked the bank for the mortgage but not the product. We've been promised non-advertised rates due to the business we have with the bank with bank accounts, savings accounts, kiwisaver, insurances etc etc.
We've got at least 20% deposit so luckily won't have to consider mortgages with extortionate mortgage indemnity fees for low deposit and high % borrowing.
If the banks are going away from the mandatory minimum 20% deposit it could spell trouble for sure

Justcol

jaffas are on the move, that means prices are only going one way.

here in Cambridge they are getting ridiculous, earlier in the year we had a look around Dunedin
The average price had risen from 260 to 300k, this was according to two agents we spoke to due to wandering jaffas

jmh

Well, in fairness they are only taking the advice you keep giving out on this forum.

Pom_Chch

Hi Paddy,

Have you considered areas outside of Chch? Rolleston, Kaiapoi, West Melton, Prebbleton etc. We found as first time buyers that value for money outside of Chch is much better, just depends how bothered you are about being in the city. There's no way we would be able to afford our current home (near Rangiora) if it was in Chch. Just have to be weary of traffic getting to and from work in those areas but if that won't be an issue for you then living outside of Chch could be a good option.

If that's not an option for you I would honestly not live in Aranui and probably not Linwood if you can help it! We rented in Avonside when we first arrived and although it did us fine temporarily I would not consider it a long term living option. Shirley is OK though. Also wouldn't touch tc3 land with a barge pole.

New Brighton and Waimari could be worth looking at. They do get a bit of a bad rap being over the east side of town but I know a few people at work living in New Brighton and they love it. Better value for money and near the sea

Good luck with your search!

Mark Smith

Lots of new builds in Wigram and Rolly not selling. Other subdivisions don't seem to be getting off the drawing board. I'm budgeting on a dip (over paying mortgage) with the rebuild peaking, I wouldn't be surprised if we end up with an oversupply of housing. Who knows.

paddy234

Yea we are currently looking at Rangiora, Kaipoi and rollerston outside of town however apparently with Kaipoi and Rangiora your talking at least an hour to get into the city with traffic at peak times but we will still do it if it's all we can afford. Our budget is really $400,000 max. I just read that New Zealand is the third least affordable country for housing in the world only after Hong Kong and Australia. What i don't understand is who would spend $400,000 on a house in Aranui? For that sort of mortgage requires two people earning a good wage so would these two people who earn a good wage and are interesting in starting a family want to bog themselves down with a large mortgage in the most dangerous and under-devolved area in the city? It's crazy

I'm trying to make sense as to whats causing house prices to go up so dramatically outside Auckland and especially in Christchurch where it still needs a correction but looking at Kiwis they think all this is normal, they see nothing wrong with it, their wages are no better than other first world countries but houses so much more expensive. My opinion is if they fall then it's a good sign things are being corrected, if they rise then this country is heading the same way as the Northern hemisphere nations did before the big crash, surely NZ couldn't be so Naive as to not learn from our mistakes. 95% and 100% mortgages are a very dangerous sign

paddy234

Thank you for the advice, yea i will have been in Kiwisaver for 3 years in August and My girlfriend is a NZ National so has been in it since she has started working. We are relying on the Kiwisaver and the Kiwisaver grant for the bulk of our deposit so will see how we go about accessing it. We know a couple who are building a home with Mike Greer and pay a 5% deposit upfront and the other 5% when it's constructed. They aren't allowed to use their kiwisaver grant until the house is completed and one of them couldn't use their kiwisaver at all as part of the deposit until the house is completed. Very strange

MrsFychan

from this it states you have to have at least 10% of the deposit yourself:

KiwiSaver HomeStart grant

paddy234

It says 10% including the addition of the grant. Also taken from another site:

I have a deposit that is 10 percent or more of the purchase price. (The 10 percent deposit includes the money you can withdraw through the KiwiSaver first-home withdrawal feature, the HomeStart grant amount you or the other purchasers may be eligible for and any other funds, such as savings, fixed and term deposits or funds already paid to a real estate agent or solicitor. The deposit can also be gifted by a relative with a File gifting declaration.) Note that the deposit cannot be borrowed or secured against other property, in order to qualify.

Justcol

Happened here a few years ago. New prices on subdivisions fell
and many were snapped up as investment / rental properties

SSky

Kiwis live diferently, sometime they buy a house and advertise the other rooms for rent.

I know! .... but life is just different here and their mind set on how to cover the finance is different.

Seems good to me, just you have to be more tollerant and share your home until it's yours and not the banks

Bo-Jangles

You're quite right around here people think nothing of renting spare rooms to foreign students - must be quite lucrative as they only provide the absolute minimum bed and board and the kids have to find their own way around.