British Expats - house prices

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- - house prices (https://britishexpats.com/forum/new-zealand-83/house-prices-518660/)

Re: house prices

Quote:

Originally Posted by Nerine (Post 6151788)

Or you could be paying $800 a week in interest on a mortgage and effectively rent your house from the bank. In the early years of most mortgages the monthly payments are mostly interest, and the interest rates are so high at the moment that it's just wasted money.

I'd rather pay $500 a week in rent, invest my capital so the bank pays me the interest, in the meantime house prices are falling and I don't have any overheads such as maintenance or rates.

(there's also tax allowances here that brings down that $500 to $300 a week, something similar should be available in NZ IMO)

Why's that then?

Re: house prices

Quote:

Originally Posted by Nerine (Post 6150914)

Have you seen this article?

House prices 30% over-valued, risk large fall

Well thought Id throw my input into this one, we arrived in October, have been renting since then but are in the process of building, we are of the thinking, why rent and pay somebody else for a house to live in when you can own your own .......... prices may fall but by 30% I very much doubt it, here in chch houses still seem to be turning over pretty fast and out in rolleston there are plenty of new builds going on that seem to contradict the current news trend

Re: house prices

Quote:

Originally Posted by ratliffe (Post 6156022)

in your case you should be on the oz page not here on the nz page, $800 a week on interest????????????????? how much do you need to borrow for that, that works out to be about $450,000 nz, that would be crazy in itself, :curse: you dont need to borrow that if you have an average deposit and you want an average house and you are not interested in an investment property, if you are happy with throwing $500 a week down the drain which is $26,000 a year thats up to you, just sounds like madness to me !!!!

:D We get more than that in interest, even after tax is deducted! so we're living for nothing, in the meantime property prices are falling whilst our capital increases.

You may've missed it before

Quote:

Originally Posted by Nerine (Post 6145741)

A few things you may like to read

NZ housing market the riskiest in the developed world

$375,000 house costing $900 a week causes hardship for a family earning $120k and thinking of moving to Australia

I'm not saying anyone else should do it, it just happens to work well for us :) and if we were to buy property now it would be an investment, either in NZ or back in the UK but only when the market has really bottomed out and that won't be for a while in either country.

Re: house prices

Quote:

Originally Posted by ratliffe (Post 6156022)

in your case you should be on the oz page not here on the nz page, $800 a week on interest????????????????? how much do you need to borrow for that, that works out to be about $450,000 nz, that would be crazy in itself, :curse: you dont need to borrow that if you have an average deposit and you want an average house and you are not interested in an investment property, if you are happy with throwing $500 a week down the drain which is $26,000 a year thats up to you, just sounds like madness to me !!!!

I think a bit of decorum wouldn't go amiss.......

I'll also beg to differ - as your IRD payments are subsidising my rental to the tune of ...... mmm .....quite a few dollars a week.

Deciding to rent or buy is a bit like being in business, cash is king and if you don't have it upfront why pay NZ interest rates rather than sitting on a small cash investment earning interest - all depends upon the market.

Have you read the number of threads where people bought a house here and lived to regret it......and you realise that there are other costs in buildings insurance, rates, etc that are built into the rental, so quoting figures like that is not the whole truth.... our place costs $370 a week and is sandwiched between some very nice real estate and a fair few $1m+ places, nice area and the landlords are good. So for us, at the moment it works....horses for courses...

Just looking at the Herald website:
http://www.nzherald.co.nz/section/1/...ectid=10502027
http://www.nzherald.co.nz/section/1/...ectid=10501995
straight off the press shows that there is at least a blip in property here.....

Clearly you have made your decision based on your circs and others make theirs. Many people who come to NZ ain't cashed up or choose to keep their UK property. Each to his/her own......there's certainly no black and white on the rent/buy front, especially with an unstable (and most commentators would argue) overvalued NZ property market......just ask the developers of all those apartments that can't be sold to service the loans from Lombard.

Re: house prices

We've built houses too, and it was a cheaper option to buy them off-plan in the UK from an established builder than to build in NZ.

In the UK the price is fixed from the outset when the deposit is paid and there are no staged payments to be made to the builder until it is completed, unlike NZ. In NZ you pay a lot at various stages eg. Roof on, enclosure, etc. and will still have to pay rental fees for 6-9 months whilst covering loan payments on the new build. Some people find they can't cover both, especially if they're on floating loan payments and it's not unusual to hear of people needing to sell as soon as they've built because they've overstretched themselves.

Building in NZ is never as cheap as you think it's going to be and there are always extra costs (landscaping, floor covering, drives, decks, planting etc) for things that you would expect as standard in Britain. These can add a significant amount to the project. You just have to be really careful with the dollars and keep an up to date spread sheet of all that is being spent.

Re: house prices

Quote:

Originally Posted by Nerine (Post 6156275)

We've built houses too, and it was a cheaper option to buy them off-plan in the UK from an established builder than to build in NZ. .....

So the Nerine school of economics/real estate would suggest buy a newly built off someone who is struggling to pay for it............leaving them with all the grief ?

Re: house prices

No, why take on their liabilities?

Re: house prices

Quote:

Originally Posted by Nerine (Post 6156314)

No, why take on their liabilities?

just squeeze them down in price as they are desperate to sell and have had all the stresses to deal with,,,,,,,,,

Re: house prices

But other people's taste is just awful, I'd have to redo it all.

Re: house prices

Quote:

Originally Posted by southerner (Post 6156348)

But other people's taste is just awful, I'd have to redo it all.

true - but think of all that money you'd save over new.......
all I have to do is visit the Op-shop, Sally Army or whatever to remind myself of the power of a "bargain" in NZ!

Re: house prices

Quote:

Originally Posted by lardyl (Post 6156319)

just squeeze them down in price as they are desperate to sell and have had all the stresses to deal with,,,,,,,,,

Seems a bit harsh, besides which why go through all the hassle?

Re: house prices

Quote:

Originally Posted by Nerine (Post 6156382)

Seems a bit harsh, besides which why go through all the hassle?

not sure you get my drift......

Quote:

Nerine: Some people find they can't cover both, especially if they're on floating loan payments and it's not unusual to hear of people needing to sell as soon as they've built because they've overstretched themselves

Me: exploit them then!! :o

Re: house prices

:D Yes I got your drift. And I've seen some pretty shoddy almost builts too, Southerner made a good point.

Re: house prices

Just picked myself off the floor after that comment...you should warn me about these things...

Re: house prices

:rofl: I just hope it was a good solid Kauri or Matai one