NZ 1st homebuyers are ScReWeD...

[fungus pudding]

I had a drive around Pegasus in the holidays. Boy, what a depressing place. I agree - it will be the next Rolleston. Even when it's complete I would not live there. It feels like a massive version of Dannemora in Auckland (apologies to any residents of that suburb).

And do you know, there is only one way in - one lane each way for 8000 to 10000 residents!!! Talk about a traffic jam! And the main road runs right through the golf course... what the hell?

I don't think anyone need worry about the traffic jams.

[Arbitrage]

People were reportedly queuing to buy the sections when they first came on the market. How many houses have actually been built so far?

[lakedaemonian]

People were reportedly queuing to buy the sections when they first came on the market. How many houses have actually been built so far?

6-12 completed(as of 12/08)

Only 1 that I could confirm as being lived in...mostly show homes.

[Dr_Who]

(as of 12/08)

Only 1 that I could confirm as being lived in...mostly show homes.

Plant lots of trees and you got yourself a holiday bach...

[upside_umop]

This guy just does not give up with his B.S spin!

From Interest.co.nz......but a good reply at the bottom.


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1. andy hamilton Says:
January 12th, 2009 at 4:06 pm

There is more than the usual spin going on.

Note the use of the whole year comparison, and the avoidance of a comparison with average value in Dec 2007 (a year on year comparison which has typically been given in their previous missives). Want to know why?

Because Dec 2007 value was $559,803 versus 2008’s December value of $509,513 - ie a $50,000 difference, a 10% fall.

I am suprised you missed that one Alex.

As regards the use of the annualised figure - mine the data a little deeper and you get this:

Average value 1st half 2007: $528,566
Average value 2nd half 2007: $548,391 (ie the peak)
Average value 1st half 2008: $519,195
Average value 2nd half 2008: $509,513

Great article FD...I read it in the herald a couple days back but it didnt have the same comment down below. I thought the same as this guy at the bottom who commented, although easy to get caught out though in this agents 'talk.' Property fell 8-9% in 2nd half of year after holding up for first half according to QV. We all know how much optimism is installed in QV figures...! This is worst than people like to admit.

30% is a reality...2/3 firms plan to layoff staff by April, you cant tell me that is going to do nothing to housing! Its these sort of expectations that take out the confidence of the market...all of the market.

Thanks for posting FD.

[Financially dependant]

My pleasure upside_umop, I really get peeved with the media coverage, so one sided.... constantly quoting Real estate agents with there vested interests and BS, then to balance the argument they quote an independent adviser!

[Arbitrage]

From QV today:

"The property market in 2008

2008 has been a pivotal year for the NZ property market with a sustained drop in property values for the first time since 1998. QV's December Residential Price Movement report shows property values fell by 7.4% during the year.

"Property values held reasonably flat through the first three months of the year, but the decline kicked in through the autumn and winter months, during which time values dropped 6%. With the significant drops in interest rates over the past three months, there has been an increase in market activity and values appear to be flattening again" said Mark Dow of QV Valuations.



"To keep 2008 in perspective it's useful to look back at the activity of the past two decades. Property values grew by 120% between 2002 and mid 2007. By way of comparison, the last period of sustained growth occurred between late 1992 and the end of 1997 when property values increased by 54%" said Dow. "After such a period of sustained growth it's inevitable that we will see a correction. The question remains how long this period of falling property values will continue."



"It's also interesting to look at the types of properties selling at the different stages of the property cycle. Between 2000 and 2003 the number of house sales more than doubled, with a dramatic increase in the proportion of lower value property selling. In the years 2004 to 2007, the number of house sales remained fairly steady, as did the proportion of low, medium and high value sales. During 2008, the number of house sales fell dramatically and the proportion of lower value properties selling significantly decreased. This pattern reflects the wider drivers of the property cycle. When the economy is strong; job prospects are good and immigration is increasing, then demand for houses, particularly first homes, pushes prices up. As the economy weakens and affordability becomes a real issue, first home buyers are usually the first to suffer; sales volumes drop and activity in the market moves back to mid to higher end properties as we saw through 2008" said Dow.

Our December report showed a 7.4% decline over the past year (calculated over the three months ending December 2008 in comparison to the same period last year) while the average New Zealand sale price for December increased slightly to $378,605.

All the main centres showed further declines in property values. In the Auckland Area values dropped back to -8.0% from the -7.4% reported in November. Hamilton values fell to -9.3% from -8.5%, Tauranga to -9.0% from -8.4%, and the Wellington Area to -6.9% from the -6.0%. Christchurch and Dunedin followed the same trend dropping to 8.0% and -7.7% respectively.

Most of the main provincial cities followed the national trend with property values easing further. Whangarei dropped 8.6%, Napier 8.1%, Nelson 7.6%, and Invercargill 9.1%. However, a number of areas bucked the trend most notably popular summer destinations like Queenstown whose property values dropped to 10.6% from the -12.5% reported in November, and Gisborne to 5.8% from 9.6% last month."

[minimoke]

Shrewdy has finally been shown to be nearly right. Latest sales figures show drops in property values – back to the levels they were at when Snoopy first posted. Indeed a home owner might now be around $1,500 worse off with their mean home value.

But buyers back then would still be better off. Interest rates have dropped around 2.5% to around 6.99% for a floating loan at Kiwibank. So the poor old January 2007 home owner would be better off by $7,500 cash in hand – not a bad place to be in these recessionary times. Interest rate drops are more than off setting real estate value drops for home owners.

[upside_umop]

No they wouldnt be...your forgeting that while we went a room for only $100 per week, it has saved us around $30k over the last 2 years instead of buying. Read some previous posts to see the calculations of savings...I dont know where your getting yours from? Or how you see paying interest over the last two years to be better off?

[minimoke]

No they wouldnt be...your forgeting that while we went a room for only $100 per week, it has saved us around $30k over the last 2 years instead of buying. Read some previous posts to see the calculations of savings...I dont know where your getting yours from? Or how you see paying interest over the last two years to be better off?

We’ve done the renting vs home ownership elsewhere and as I have previously said there are certainly merits to renting. But what we can’t do is compare renting 1 bedroom at $100 a week with owning a home.