Which way will the property market go now?

[peetter]

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.

[fungus pudding]

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.

[Bjauck]

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...

[Panda-NZ-]

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

[SBQ]

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.

[ynot]

Although I commend peetters efforts I also agree with you 100% SBQ. Timing is often everything when it comes to investment and no doubt peetter would have a bigger challenge on his hands if he was starting out today. Its fairly obvious today that many young kiwis as stareing down the barrel of an insurmountable challenge to enter the propery market.
I always believed in the past that with some effort, attaining your own home in NZ was almost a birthright, and whats more should be any elected governments priority to ensure this is possible.
Kiwi governments have failed Kiwis miserably.

[peetter]

I should probably clarify couple things.

I lived in a car because I wanted to, not because I had to. It was only for couple months and one of the best experiences. Living like this allows you to travel and save at incredible rate. And I just bought this year, so you'd be wrong if you think I'd change my opinion if I was just starting. I am actually starting on my way to get deposit on investment property.

I don't think the house prices should rise in a rate they do now. I think healthy growth between 3-7% should be the goal. However I don't blame landlords one bit for the prices. The blame is 100% on governments. The issue is not of people investing in housing, rentals are necessary. People need rentals for various reasons. The issue is with building regulations, NZ approach to living in houses and goverments ignoring the issue. What current government is doing is shameful shifting of blame to people who provide rental accomodation in a time when there's 20000 people on HNZ waitlist. I don't think Labour made the crisis. They just ignored it and instead of trying to solve it they are now panicking and trying to use envy to redirect public anger to somebody else. This is disgusting.

[ynot]

Bang on mate. Its our obligation as Kiwis to be screaming from the rooftops. THIS IS NOT GOOD ENOUGH. DO YOU JOB !!!

[iamaskier]

I should probably clarify couple things.

I lived in a car because I wanted to, not because I had to. It was only for couple months and one of the best experiences. Living like this allows you to travel and save at incredible rate. And I just bought this year, so you'd be wrong if you think I'd change my opinion if I was just starting. I am actually starting on my way to get deposit on investment property.

I don't think the house prices should rise in a rate they do now. I think healthy growth between 3-7% should be the goal. However I don't blame landlords one bit for the prices. The blame is 100% on governments. The issue is not of people investing in housing, rentals are necessary. People need rentals for various reasons. The issue is with building regulations, NZ approach to living in houses and goverments ignoring the issue. What current government is doing is shameful shifting of blame to people who provide rental accomodation in a time when there's 20000 people on HNZ waitlist. I don't think Labour made the crisis. They just ignored it and instead of trying to solve it they are now panicking and trying to use envy to redirect public anger to somebody else. This is disgusting.

I certainly don't begrudge the player but I reckon from a societal good perspective, the game is f##ked (and it seems we agree). There will always be people who manage to make the leap (and again good on you) but what I don't like seeing is that this is rapidly becoming the exception rather than the norm and encompasses and ever shrinking set of personal situations. I generally agree with what you're saying though with the added caveat that some of the bleating from pockets of landlords has been a little on the nose.

I feel like this garners way less attention than it should and I cant help but think that we haven't cottoned on to how much we're embedding a 2-tier society and that young people on a large scale haven't fully had the reality bite yet.

[Joshuatree]

Many , not all, of these house investors are the disgusting ones on an uneven playing field , running those houses at loss , claiming interest and all manner of things deducted, raising the rent at any opportunity and not maintaining their properties. Thank Dog its changing and first home buyers have more chances here on and renters have more rights. Greed and materialism ahead of ethics, caring or compassion.