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  1. #111
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    Quote Originally Posted by Bjauck View Post
    The Reserve Bank has clearly thrown the responsibility for tackling high rents and First Home Buyers being priced out of NZ housing on to the Government.

    “[T]he house price level may be sustainable in a market sense, even though rents may be high and deposits unaffordable for prospective first-home buyers.
    “In this case, there are social costs that go beyond the implications of house prices for the Bank’s financial stability mandate and these call for a broader public policy response,” the report said"
    https://www.stuff.co.nz/national/pol...fordable-house
    The market will sort out rent levels as long as the govt. keep their noses out of it. Housing would too, once again if the govt kept out of it. Town planning and zoning restricts new supply. Sort that out - and let the market solve any problems.

  2. #112
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    Quote Originally Posted by fungus pudding View Post
    The market will sort out rent levels as long as the govt. keep their noses out of it. Housing would too, once again if the govt kept out of it. Town planning and zoning restricts new supply. Sort that out - and let the market solve any problems.
    The government is entwined with housing through tax policies, benefits and regulations. They cannot be divorced. “The market” operates within the parameters set by government.

    As SBQ says, it is all down to bad government policy. However it need not be bad...
    Last edited by Bjauck; 06-05-2021 at 01:05 PM.

  3. #113
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    House prices everywhere seem to be increasing:

    In america not known for high house prices with all that spare land and rather minimalist regulation.

    Even in the state of Idaho (where?)

    https://www.youtube.com/watch?v=Hdpd5U811Ho
    Last edited by Panda-NZ-; 25-05-2021 at 09:23 AM.

  4. #114
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    Quote Originally Posted by Panda-NZ- View Post
    House prices everywhere seem to be increasing:

    In america not known for high house prices with all that spare land and minimalist regulation.

    Even in the state of Idaho (where?)

    https://www.youtube.com/watch?v=Hdpd5U811Ho
    A 11.6% nationally in the US, rise in house prices? I can handle that. In NZ it's an entirely different level. Boise would be a hot spot but it could also mean house prices there have been low far too long or their economy is doing far better than other states etc. Certainly not systemic nation wide unaffordable housing that we have in NZ.

    Canada is more along the lines of the US in terms of past house price rise since start of Covid. I was reading today their central bank is giving more guidance that buyers be cautious of low interest rates pushing people into longer term mortgages and end up paying far too much. Unlike NZ, N. America is VAAAAAAST and choices are far and wide to where you want to live & work - especially when there's 'remote working' available for the masses. The biggest losers are the states that hit residence the most in taxation like California and NY. Remote working out of your home allows them to leave those states and move to what we see, smaller less populated states, small townships for which again, always have low low prices.
    Last edited by SBQ; 24-05-2021 at 08:39 AM.

  5. #115
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    Quote Originally Posted by SBQ View Post
    There's a lot of waffle in that report and it fails the key reasons why property investors in NZ take on such a high leverage positions (likewise with 1st home owners). Personally I don't believe the central or reserve bank should be held accountable for the housing problem as their primary goal is monetary policy. This whole consultation and assessment process will go down no different to when Jacinda issued that Tax Working Group inquiry (WASTE OF TIME). You can not differentiate lending between those that want to buy their 1st home vs those that are buying for rental investments because they are not mutually exclusive situations (as they are buying the SAME asset).

    The key problem for investment behaviours is not that interest rates are low but rather in NZ, the #1 the best game in town is still owning houses. Why has the gov't and the reserve bank not pointed out this key issue? Because it seems so elementary that if you want to cool things down, you tackle the INCENTIVES of why people are getting rich off houses. The framework is entirely wrong. Now if it was the case of owning shares in a company; no one cares but the investors themselves if the share price rockets up or crashes as not everyone own shares as investments.

    Take away the tax advantage by owning houses. It's that simple. Canada has done well in this aspect and for the past decade (and particularly in the past few years), home ownership has increased. Yes there are hots spots like Vancouver and Toronto but they do not add up to the same proportions we see in NZ where if you take the largest density populations (Alk/Wgt/Chc and Tauranga etc) that 'may' account for like say 80 or 90% of NZ's population that is under the unaffordable housing situation.

    Again, NZ is not a unique case as there are plenty of OECD small nations that manage home ownership a lot better and deter investment away (leaving their population to invest in more productive assets).

    It's all down to bad gov't policy.

    Property investment is the best way to build wealth in most of the world for average low-middle income person. You can spin it any way you want to, but easy to get leverage is the way to og. Not everyone can start a business and shares will not give you the same return as 80% leveraged property. You might think property investors are evil, but the overwhelming majority are just families trying to get out of the wage slaving and paying half of their incomes to government who sqanders it on admin and stupidities.

    Taking this option away, taxing expenses, making it hard to invest in property will only result in taking away one of the ways to get ahead. Shame on people for trying to take care of themselves and getting out of the rat race. Let's force them to fail and daddy government can support them while they spend 60years slaving in a job they hate and when they retire, they'll live on beans and rice.

  6. #116
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    Quote Originally Posted by peetter View Post
    Property investment is the best way to build wealth in most of the world for average low-middle income person. You can spin it any way you want to, but easy to get leverage is the way to og. Not everyone can start a business and shares will not give you the same return as 80% leveraged property. You might think property investors are evil, but the overwhelming majority are just families trying to get out of the wage slaving and paying half of their incomes to government who sqanders it on admin and stupidities.

    Taking this option away, taxing expenses, making it hard to invest in property will only result in taking away one of the ways to get ahead. Shame on people for trying to take care of themselves and getting out of the rat race. Let's force them to fail and daddy government can support them while they spend 60years slaving in a job they hate and when they retire, they'll live on beans and rice.
    I made that statement many times in the past posts here. Yes houses are still best game in town in NZ but no one in that camp is willing to say it's a good thing for NZ society. Why would they? They got the houses, they got the nice cars, they send their kids to private schools, they use the private health care system instead of public. It's a real shame no one really talks much about it in gov't and at least try to see how other countries address this issue. NZ is a small country and is limited to investment choices? That's another lie - so are many OECD countries similar to NZ population and they don't impose investment restrictions (Sweden, Singapore, etc).

    Don't take my comments as being so rash, have a read here about NZ's vast inequality here:

    https://berl.co.nz/our-pro-bono/ineq...nd-new-zealand

    You know the higher house prices go in NZ, the more inequality we have in NZ. A system of 'the haves' that own the houses vs the 'have nots' that end up renting forever. So what does the mom & pop have to do with their spare cash? Well I lay the blame of many decades of NZ's obsession of owning houses and after 40 years the results are clear ; NZ's productivity per capita pales in comparison to most OECD nations. But no one wants to talk about that in NZ gov't - they want to string along the top 5% of the wealthy just so they get their votes. There are many ways you can address this problem and give the working class the upper hand over the top 5%; but i'm not seeing that here in NZ. I wish I could be more positive about this but coming from a background of finance - the way I see Kiwi Saver structured and the way NZ's tax system works ; the only thing that is most likely to occur is more higher house prices in the future.

  7. #117
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    Quote Originally Posted by SBQ View Post
    I made that statement many times in the past posts here. Yes houses are still best game in town in NZ but no one in that camp is willing to say it's a good thing for NZ society. Why would they? They got the houses, they got the nice cars, they send their kids to private schools, they use the private health care system instead of public. It's a real shame no one really talks much about it in gov't and at least try to see how other countries address this issue. NZ is a small country and is limited to investment choices? That's another lie - so are many OECD countries similar to NZ population and they don't impose investment restrictions (Sweden, Singapore, etc).

    Don't take my comments as being so rash, have a read here about NZ's vast inequality here:

    https://berl.co.nz/our-pro-bono/ineq...nd-new-zealand

    You know the higher house prices go in NZ, the more inequality we have in NZ. A system of 'the haves' that own the houses vs the 'have nots' that end up renting forever. So what does the mom & pop have to do with their spare cash? Well I lay the blame of many decades of NZ's obsession of owning houses and after 40 years the results are clear ; NZ's productivity per capita pales in comparison to most OECD nations. But no one wants to talk about that in NZ gov't - they want to string along the top 5% of the wealthy just so they get their votes. There are many ways you can address this problem and give the working class the upper hand over the top 5%; but i'm not seeing that here in NZ. I wish I could be more positive about this but coming from a background of finance - the way I see Kiwi Saver structured and the way NZ's tax system works ; the only thing that is most likely to occur is more higher house prices in the future.
    The residential property investing is not just NZ thing, it's normal around the globe and most countries don't blame their government fails on property investors.


    And the only inequality in NZ is inequality of effort and entitlement. There are tens of thousands of immigrants from second and third world coming here creating wealth for their families starting from nothing. Then there are locals who can't be bothered to lift a finger. Just go and ask average farmer. I talked to some I worked for and they all say the same. Honest day of work is not good enough for locals.

    And on top you have a government working on creating as many of people dependend on them as possible to boost their voter base.

  8. #118
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    Quote Originally Posted by peetter View Post
    The residential property investing is not just NZ thing, it's normal around the globe and most countries don't blame their government fails on property investors.


    And the only inequality in NZ is inequality of effort and entitlement. There are tens of thousands of immigrants from second and third world coming here creating wealth for their families starting from nothing. Then there are locals who can't be bothered to lift a finger. Just go and ask average farmer. I talked to some I worked for and they all say the same. Honest day of work is not good enough for locals.

    And on top you have a government working on creating as many of people dependend on them as possible to boost their voter base.
    There is massive inequality of opportunity - we don't even have an inheritance tax. How can a society be equal when people can get a free ride from their parents work, on top of all the other advantages to coming from a rich family?

  9. #119
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    Quote Originally Posted by mfd View Post
    There is massive inequality of opportunity - we don't even have an inheritance tax. How can a society be equal when people can get a free ride from their parents work, on top of all the other advantages to coming from a rich family?
    I fail to see how somebody's parents working smart and hard and passing something to children is anything wrong? There's plenty of opportunities to do this nowadays. My parents had nothing, gave me nothing and I am on my way to retire by 45. I do it by sacrificing and working harder than others. Anyone can do it, literally anyone. I came here, had nothing, lived in car and worked at kiwi orchards. 5 years later I own my own property and invest in stocks.

    There is full equality of opportunity. If you're poor in NZ, it's by choice. That's a fact. Coming from post soviet country, I can tell you anyone living on minimum wage in NZ is rich. Living here is a breeze.
    Last edited by peetter; 30-05-2021 at 09:58 PM.

  10. #120
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    "While many legislators have pushed for raising the minimum wage, with more and more cities across the US roll out higher minimum wage laws, Buffett does not favor this solution. In an op-ed for the Wall Street Journal in 2015, Buffett wrote that raising the minimum wage would actually create more problems for our market system.

    Instead, he offers a different way to help and incentivize struggling Americans.

    “The Earned Income Tax Credit is the single best way,” Buffett said."
    https://finance.yahoo.com/news/warre...150507164.html

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