NZ 1st homebuyers are ScReWeD...

[corran]

Hi macdunk....

I hope you don't mind me borrowing a quote of yours (from today) from another thread...

I don't get how your "now is as good a time as any to buy" belief is consistent with your, in my opinion, spot on the money statements below...

could you please clarify?

The property market is starting to crumble...

...The smart money goes with the flow, never swim against the current...

Macdunk

[STRAT]

Hi Shrewdy,
I went back to your opening post to ascertain your position in this debate but couldn’t find one. If I was in the market looking for a house today to live in I would like yourself be waiting to see what happens over the next wee while ( weeks , months, year ) and adjust my decision to buy as things unfold. I agree we have hit the top of one of the longest property booms ever. If I was looking for an investment property it would be business as usual. If a property can wipe its own ars then its worth buying ( as a long term investment ) irrespective of whether the price dips in the next 3 months to 3 years. If you cant find a property that is cash flow positive then you have answered your own question as to whether you should buy or not but it really comes down to your individual circumstances. Live in or not. Flatmates or not, Joint venture or go it a lone, Deposit size, Current rent and living expenses etc etc. The key thing to remember is that long term RE is a stable investment so as long as you are using someone elses money to purchase and maintain you really cant go wrong. Second key point is with the way mortgages are set up these days ( may be changing soon with the credit crunch and all ) as your equity increases you gain access to credit at favourable rates.
I guess if you add a little detail about your position or create a hypothetical scenario it could be discussed in more detail. I haven’t read the whole thread so forgive me if this has already been done.

[duncan macgregor]

Hi macdunk....

I hope you don't mind me borrowing a quote of yours (from today) from another thread...

I don't get how your "now is as good a time as any to buy" belief is consistent with your, in my opinion, spot on the money statements below...

could you please clarify?

CORRAN, A lot of uninformed people think that is a contradiction. Sell at the top of a cycle buy at the bottom is the best way to move forward and upward. Shares and property are both taking a hit right now, the smart money has moved to a buy when it bottoms position. With property, bargains can be had at most stages of the cycle, with super bargains to be had when the cycle bottoms. Banks are not landlords they sell to the highest bidder to recoup as much of the loss that they can. Now is the time to attend a few mortgagee sales to get the feel of what is available.
This is the beginning of the good times for bargain hunters, the banks are the ones you are dealing with, show them no mercy. There is no rush to buy anything, silly low offers take a bit longer thats all so the sooner you have educated yourself to what is going on the better. Macdunk

[peat]

This wont help the market go down


http://www.nzherald.co.nz/section/1/...ectid=10491994


PM announces shared equity scheme for home buyers


ALthough I'm a bit of a Helen supporter (she's one of very few intelligent politicians) this is not the right approach and will only support the housing market boom by giving a few luckies an interest free loan. Dear dear Labour - this will aggravate the right wingers as it really is more meddling that will cause market distortions. Eg reduce the demand for rentals and increase the demand for 2nd hand homes.....
I find it hard to believe Cullen agreed to this.

[Arbitrage]

Why do politicians always meddle in the housing market?
History shows that price crashes are often a result of govt intereference (eg Hong Kong and UK have both had major corrections downwards as a direct result of govt policy shifts). With the relatively free market in nz we have generally avoided major problems. Just let the market go.

[STRAT]

Why do politicians always meddle in the housing market?
History shows that price crashes are often a result of govt intereference (eg Hong Kong and UK have both had major corrections downwards as a direct result of govt policy shifts). With the relatively free market in nz we have generally avoided major problems. Just let the market go.

In this case to win votes at any cost. Nothing more. Dont you worry they are just getting warmed up with the handouts. Besides they know they can always go back on their word later.

[corran]

CORRAN, A lot of uninformed people think that is a contradiction. Sell at the top of a cycle buy at the bottom is the best way to move forward and upward. Shares and property are both taking a hit right now, the smart money has moved to a buy when it bottoms position. With property, bargains can be had at most stages of the cycle, with super bargains to be had when the cycle bottoms. Banks are not landlords they sell to the highest bidder to recoup as much of the loss that they can. Now is the time to attend a few mortgagee sales to get the feel of what is available.
This is the beginning of the good times for bargain hunters, the banks are the ones you are dealing with, show them no mercy. There is no rush to buy anything, silly low offers take a bit longer thats all so the sooner you have educated yourself to what is going on the better. Macdunk

fair enough.... I guess it depends on how long you think it's going to take before we see the bottom of the cycle. I think we've got a long, long way to go, so what might seem a bargin now may look very overpriced in a year or two's time.

I'm curious.... you seem to base your decisions almost purely on technical analysis when it comes to shares and then almost purely on fundamental analysis when it comes to property. Maybe thats a system that works for you but for someone who is quite outspoken on the advantages of technical investing, it seems a bit inconsistent to me.

My approach may be too conservative for many, but I've been burnt by buying at the top of the property market before and I'm in no rush at all to buy this time around...

[Steve]

I'm curious.... you seem to base your decisions almost purely on technical analysis when it comes to shares and then almost purely on fundamental analysis when it comes to property. Maybe thats a system that works for you but for someone who is quite outspoken on the advantages of technical investing, it seems a bit inconsistent to me.

Although there are a core set of analytical principles and techniques, the reality is that different 'markets' often require a differing criteria for meaningful analysis...

Yes, MACDUNK could use both fundamental and technical for shares AND property, however the reality is that the property market is not really suited for technical analysis.

Having said that, I believe that there are, or used to be, a property fund in the US that was based on technical analysis back in the 80s/90s. Don't recall what happened to it.

[minimoke]

Help may well be on the way. If you want to get into housing and don’t want to do the hard yards you could sign up for Labours proposed Ghetto initiative.

Here you’ll get to live in a “modest” house, built to reduced building standards, in dodgy land areas by trades people not tempted by Australia or a profit motive. Your neighbours, and there will be lots of them, will be low or middle income earners.

You won’t need to save as much because the tax payer will take an equity share on your behalf. And nor will your neighbour. Stretched so they can afford the reduced mortgage, they’ll probably struggle to keep up with the maintenance – but that’s OK because you’ll be in the home you so desperately want to own.

If you want a view of your future just drive through any state or council housing estate built from the 50’s.

Renting may not look so bad!

[Serpie]

If you want a view of your future just drive through any state or council housing estate built from the 50’s.

I've got a 1940's state house surrounded by other 1940's state houses here in ChCh. It's on a huge section, and, being a raging capitalist, I wanted to subdivide the section and build another house on the back.

My efforts have been thwarted because the house is in a "SAM" or special amenities area. SAM 37 to be exact, for which the council description goes:

"The layout reflects the key elements of State-housing during the 1940s – 1950s. It includes curved streets, reduced road widths, street tree planting, direct access to a communal park and large front gardens with low fencing. The regular distance that the houses are set back from the street is also notable".

Sounds idyllic doesn't it!

I'm not sure about your claims regarding "built to reduced building standards" though MM. John Key was on the news this morning saying that one of the factors in increased build costs was the tightening of building standards. And the build quality, and materials used, in 1940's state housing was outstanding.
When I was in Rotorua recently a friend of mine showed me a recent state house, and it was awesome.