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 Post subject: Re: Entering Denial in New Zealand
PostPosted: Mon Dec 18, 2017 10:40 am 
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temene wrote:
Sidewinder wrote:
Grim reading, and Ireland gets a mention! https://www.stuff.co.nz/life-style/home ... t.96755666
Fascinating insight.


Everyone really needs to watch this to understand exactly what has happened in the Western countries, and how ultimately doomed it is to end to devastation. Your lifestyle or your children's lives. That's your choice.


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 Post subject: Re: Entering Denial in New Zealand
PostPosted: Mon Dec 18, 2017 1:28 pm 
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I'm not convinced. It covers price to income but didn't cover the cost of borrowing. People have more disposable income than back in the 80s. Less of their salaries go towards housing.
Then there's talk about deregulation, which is a great thing that creates competition within the banking industry.
Then it complains about Chinese investment - Ireland had to set up a government body to try get investment in Irish property.
Nobody is doomed.

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 Post subject: Re: Entering Denial in New Zealand
PostPosted: Tue Dec 19, 2017 12:36 pm 
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conork wrote:
It covers price to income but didn't cover the cost of borrowing. People have more disposable income than back in the 80s. Less of their salaries go towards housing.


Fair point, although it's worth adding that folks back in the 80's had a legitimate hope that rates would fall materially, since they were in double digits at the time. And they did that, freeing up income and making them better off. Thats not a realistic hope for borrowers now since there's effectively no further for rates to fall.

The fact that debt servicing costs as a portion of income are even comparable with the 80's with interest rates at their lowest point in history now is telling in itself.


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 Post subject: Re: Entering Denial in New Zealand
PostPosted: Thu Jan 04, 2018 8:07 am 
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Landlords bail on rental market: 'It is just not worth it' - -> https://www.radionz.co.nz/news/national ... t-worth-it

Quote:
The experts say landlords are being tempted to take their capital gain and run, before harsh new rules undermine the value of their investments.

The concerns have arisen as the government moves to implement dramatic reforms of the housing market.

The looming changes include:
  • A capital gains tax on second homes, depending on the outcome of a special tax inquiry.
  • The imposition of 'ring-fencing rules', which would reduce tax deductibility for rental houses, by ensuring losses cannot be set off against other income.
  • An extension of the 'bright line test', under which anyone selling a rental home within five years would be deemed a trader and would therefore be taxed.
Property Investors Federation executive officer Andrew King said these planned changes were scaring off investors from the property market.

there is more



Balance tilts in Auckland housing market for first time in seven years - -> https://www.stuff.co.nz/business/proper ... even-years

Quote:
The property market appears to be holding its breath ahead of major changes to lending, one economist says.
New data out from industry website realestate.co.nz showed the Auckland market softening last month and that nationally new listings are down to an all-time low, indicating people are uncertain about selling their houses.
The website said Auckland had become a buyers' market, based on its inventory figures. It would now take 24 weeks to sell all the houses for sale in Auckland, if no other listings were added to it, surpassing its long-term average of 23 weeks.

there is more


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 Post subject: Re: Entering Denial in New Zealand
PostPosted: Sat Jan 06, 2018 5:47 am 
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From BoyRacer's first article:

Quote:
Mike Coffey, the Wellington regional director for the Real Estate Institute, thought the new government's coming changes would put up barriers against new investors in the property market.

He said this would tilt the playing field in favour of large, well-established companies with deep pockets, and would do nothing to help the supply of rental properties.

But he pointed out that one government plan would not have an impact: restricting sales of homes to foreigners who were claimed to distort the market.

"I believe it's a myth, certainly in the Wellington region," he said.


On the first point....good. Well-established rental companies do things properly, have staff on hand to sort out issues, the money to make sure houses aren't damp leaky mouldy sh1tholes, and tend to have a long-term view and value good tenants. In every country the bane of the market is the amateur idiots with 1 or 2 BTLs who never maintain their properties and will turf out good tenants whenever they think they can squeeze a quick buck, like in the season when all the students come back.

On the second point....well in 6+ years I've had three landlords. One Kiwi, the other two owned by overseas buyers (one Chinese, one Indian) using local agents to manage the property. And most of my friends rent so I know that experience isn't at all unusual. So Mr Wellington estate agent is talking bollocks.

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 Post subject: Re: Entering Denial in New Zealand
PostPosted: Sat Jan 06, 2018 10:07 am 
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Sidewinder wrote:
From BoyRacer's first article:

Quote:
Mike Coffey, the Wellington regional director for the Real Estate Institute, thought the new government's coming changes would put up barriers against new investors in the property market.

He said this would tilt the playing field in favour of large, well-established companies with deep pockets, and would do nothing to help the supply of rental properties.

But he pointed out that one government plan would not have an impact: restricting sales of homes to foreigners who were claimed to distort the market.

"I believe it's a myth, certainly in the Wellington region," he said.


On the first point....good. Well-established rental companies do things properly, have staff on hand to sort out issues, the money to make sure houses aren't damp leaky mouldy sh1tholes, and tend to have a long-term view and value good tenants. In every country the bane of the market is the amateur idiots with 1 or 2 BTLs who never maintain their properties and will turf out good tenants whenever they think they can squeeze a quick buck, like in the season when all the students come back.

On the second point....well in 6+ years I've had three landlords. One Kiwi, the other two owned by overseas buyers (one Chinese, one Indian) using local agents to manage the property. And most of my friends rent so I know that experience isn't at all unusual. So Mr Wellington estate agent is talking bollocks.


Plus of course that rental companies have negotiating power well beyond the ability of a individual BTLer. Its a risk to the bottom line, nothing else.


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 Post subject: Re: Entering Denial in New Zealand
PostPosted: Thu Jan 18, 2018 6:57 am 
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Hmmm. This all seems very familiar, vintage "Ireland 2007" reporting again.

https://www.stuff.co.nz/business/100675 ... rong-reinz

Things that will jump out to veteran pinsters:

1) The careful emphasis on year-to-year increases with nary a mention of recent month-to-month trends

2) Collapsing sales volumes...
2b) ...especially at the "affordable" end of the market, meaning these possibly-misleading (see #1) stats are skewed towards the very high end properties

3) "the rate of price increases has decreased significantly" reminded me vaguely of that mental phrase Irish commentators were using to try and deny price falls, anyone remember how that one went again? Not in the same league as the Irish version but moving in that direction from the "Get On The Ladder Quick" mentality

4) Regional variations on sales volumes...it looks like the the really remote areas have totally collapsed; as have the cities, olde-tyme commuter belts and bubble-era commuter belts like the Tron, with most of the few sales volume increases now happening in the twilight zone between the edge of any rational and sensible commute distance, and the real remote boondocks. I seem to remember a similar trend in Ireland around 2007, the last desperate throw of the dice by the Ladderistas

Meanwhile in Welly...now Jan/Feb is always mental as it is basically when all the students are flat hunting for the new academic year which starts in Feb here BUT this year

a) demand has soared as house prices are absurdly out of reach for the vast majority of workers so everyone is renting now, not just students AND
b) the available supply of rental properties has collapsed to HALF the level available last year

The new Finance Minister is a Welly MP so it'll be interesting if this now-crisis-level problem starts to dimly intrude on the tiny minds of the political class.

https://www.stuff.co.nz/business/proper ... n-trade-me

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 Post subject: Re: Entering Denial in New Zealand
PostPosted: Thu Jan 18, 2018 9:18 am 
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Good to see you posting Sidewinder.

The next step (c) is when vendors rush to try to rent out their units and end up crashing the rental market with excess inventory, and (d) prospective buyers see what's happening and sit it out.


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 Post subject: Re: Entering Denial in New Zealand
PostPosted: Fri Jan 19, 2018 7:54 am 
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Sidewinder wrote:
The new Finance Minister is a Welly MP so it'll be interesting if this now-crisis-level problem starts to dimly intrude on the tiny minds of the political class.


And suddenly, as if by magic...

https://www.facebook.com/GrantRobertson ... 3345098894

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 Post subject: Re: Entering Denial in New Zealand
PostPosted: Fri Jan 19, 2018 3:09 pm 
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Sidewinder wrote:
Hmmm. This all seems very familiar, vintage "Ireland 2007" reporting again.

https://www.stuff.co.nz/business/100675 ... rong-reinz

3) "the rate of price increases has decreased significantly" reminded me vaguely of that mental phrase Irish commentators were using to try and deny price falls, anyone remember how that one went again? Not in the same league as the Irish version but moving in that direction from the "Get On The Ladder Quick" mentality



This one?

viewtopic.php?f=4&t=25935&hilit=second+derivative

Quote:
The correction in the residential housing market continued over the summer months however the rate of decline moderated further on the quarter two results, according to Sherry FitzGerald Ireland's largest estate agents.


Quote:
Is this the first time that a commentator has gone to the fourth derivative to describe Property Prices? :P

First Derivative:
"the decline"

Second Derivative:
"the rate of decline"

Third Derivative:
"the rate of decline moderated"

Fourth Derivative:
"the rate of decline moderated further"


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 Post subject: Re: Entering Denial in New Zealand
PostPosted: Fri Jan 19, 2018 11:35 pm 
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Braighni wrote:
Sidewinder wrote:
Hmmm. This all seems very familiar, vintage "Ireland 2007" reporting again.

https://www.stuff.co.nz/business/100675 ... rong-reinz

3) "the rate of price increases has decreased significantly" reminded me vaguely of that mental phrase Irish commentators were using to try and deny price falls, anyone remember how that one went again? Not in the same league as the Irish version but moving in that direction from the "Get On The Ladder Quick" mentality



This one?

viewtopic.php?f=4&t=25935&hilit=second+derivative

Quote:
The correction in the residential housing market continued over the summer months however the rate of decline moderated further on the quarter two results, according to Sherry FitzGerald Ireland's largest estate agents.


Quote:
Is this the first time that a commentator has gone to the fourth derivative to describe Property Prices? :P

First Derivative:
"the decline"

Second Derivative:
"the rate of decline"

Third Derivative:
"the rate of decline moderated"

Fourth Derivative:
"the rate of decline moderated further"

Tut tut don't mention decline. Prices "eased"

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 Post subject: Re: Entering Denial in New Zealand
PostPosted: Sat Jan 20, 2018 7:14 am 
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It might have been that one alright Braighni, it was a decade ago so I only dimly remember some wildly convoluted phrase :)

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 Post subject: Re: Entering Denial in New Zealand
PostPosted: Sat Jan 20, 2018 7:23 am 
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I don't think EAs or journos understand enough maths to use the right words.

"Rate of decline slowing" usually means "prices dropped 2% last month and 1.9% this month" or whatever, i.e. trend towards price stability.

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 Post subject: Re: Entering Denial in New Zealand
PostPosted: Sat Jan 20, 2018 10:42 am 
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They need to get the lingo right!
April 2007 - Bertie Ahern (PM) Property market to have soft landing
June 2007 - John Hurley (CBI) added his voice to the ranks of those predicting a soft landing for the Irish housing market


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 Post subject: Re: Entering Denial in New Zealand
PostPosted: Sun Jan 21, 2018 10:55 pm 
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Posts: 206
A bubble in Auckland does not equate to the whole country. Houses are selling steadily here in Christchurch. There is very little to compare to ireland c2007. NZ has lots of natural resources, services, and exports as well as a housing sector. ireland made themselves uncompetitive and ran a massive housing bubble. In christchurch you can easily find a very nice house for 500 NZD (300k euros). Even in 2007 Ireland that was not a lavish price for a major population centre.


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