NZ 1st homebuyers are ScReWeD...

[Dr_Who]

Last chance to get yourself a cheap property. Next year will be too late.

You heard it here first.

[fungus pudding]

Last chance to get yourself a cheap property. Next year will be too late.

You heard it here first.

A matter of opinion - certainly not mine.

[duncan macgregor]

Last chance to get yourself a cheap property. Next year will be too late.

You heard it here first.

If you are talking about first home buyers with a limited budget then it is already to late. Increased deposit levels have seen this lot shut out.
All the smart ones got their feet on the bottom rung of the ladder last year. It will be like all the other numerous property down trends that i have encountered and come back trending up higher than ever.
You dont time the property market when buying you can pick up a bargain at any stage in the cycle. You only time the market when selling its faster and easier in an uptrend and less expensive. We have builders getting out the game fewer apprentices learning, which all leads up to an industry full of cowboys charging extortionate prices.
I myself think the downward spiral will last for another couple of years followed by a huge uptrend. Macdunk

[Crypto Crude]

Do you remember the story awhile back about how my great friend bought a house and I posted here about it.... needless to say I was quite dissapointed with him...
Well, the Bank made him get fixed interest...
and now interest rates are falling, and going to fall Later this month with the next cut...
He's now being hung out to dry with these excessive high fixed costs which were paramount to him getting a loan in the first place..... talk about paying for the credit crisis eah...

mackdunk,
You said it in your own words just then...

I myself think the downward spiral will last for another couple of years followed by a huge uptrend. Macdunk

hahaha... do we have our first sign of mackdunk warning first hombuyers off property...... thanks for being honest...

increased deposits, harder to get loans... blah blah blah...
Loans shmoans...
hahaha... This is to our benefit mack a dee..less
sophisticated individuals will not be able to buy, driving prices down further.... hehehe... I hope banks tightened the belt further... hehehe...

Plenty of time to buy mackdunk... hehehehe

.^sc

[minimoke]

Well, the Bank made him get fixed interest...

Thanks Shrewdy, I try to learn something new everyday and until now I’d never heard of banks holding a gun to a clients head and ordering them to take up a loan. Oh well these things must happen. Care to share the banks name to warn us of this dubious practice?

[duncan macgregor]

Thanks Shrewdy, I try to learn something new everyday and until now I’d never heard of banks holding a gun to a clients head and ordering them to take up a loan. Oh well these things must happen. Care to share the banks name to want us of this dubious practice?

Twisting of words to suit the arguement. Nobody is forced to take out a loan fixed or floating. The bank has evey entitlement to offer one or the other or none at all at what ever rate they see fit. Its a business deal go to another bank if their deal is not satisfactory. Thats what is called a free and open market where banks compete for your business. Macdunk

[minimoke]

Twisting of words to suit the arguement.

Oh – I just thought that when Shrewdy said his mate was “forced” to take a fixed interest deal he was uh, forced. But what short memories we have when it was only last year when people were on fixed rates seeing the banks increase their interest rates. Shrewdys other mates were probably the king pin of those negotiations with their own gun to the banks head at the time.

Anyway this current market is why I like my approach – a mix of fixed and floating. I get the best of both worlds. I don’t care about the rates coming down in relation to my fixed loan. I have said earlier a mortgage is simply a personal commitment to repay the bank for the pleasure of the use of their money. My approach to that commitment is not to bleat about it if circumstances change – but I am always free to renegotiate on whatever terms we can agree. I am looking forward to July when my fixed comes off and I’ll be up for a new fixed rate!

[peat]

yeh thats how i handle it to minimoke... %80 fixed and 20% floating - which I pay off faster than required. and yes I feel like i'm getting a bit reamed with the fixed at 9.7 but its only been for one year and ends in April , and I had 5 years at 6.95 before that. I'm thinking a 3 - 5 year one when I renew in a few months time - historically its quite low again. thats not to say it wont go lower but still seems sensible to lock it in for a goodly period of time when its below the long term average.

[Financially dependant]

The big question: is it time to buy?

“Real estate agents say it’s a great time to buy now that prices have come down and interest rates are low.
You’ve been saying house prices have a long way to drop. What’s really going on, and how do we decide whether to jump in to the housing market or sit on the sidelines for a bit longer?”

Don’t listen to the real estate agents—they will always say it’s time to buy. Tell me when you last heard an agent imploring the public to sell up?

As to whether now’s the time, the correct answer of course is that it will be for some, and not for others – personal circumstances are often the most important determinant of timing decisions like that. Only you can make that call. But l won’t wimp out with that excuse.

In general, house prices have some way to fall yet. A couple of years ago I said publicly that they looked to be about 30% overvalued in terms of long term trends. Now we have the correction underway, I guess the call is to estimate how far through it we might be.

The graph shows the problem. The market peak was reached at $351,500 in September 2007. At last count (December 2008) prices had retreated 10.6% from that already, made up of a 6.5% fall in prices over a period where general inflation has totaled 4.6%. So simply on that long term trend analysis, you’d pick a further 17% to go in real terms until we reach fair, sustainable value. I’d guess that will take 24 months and be made up of a further fall of 15% in house prices over that time while inflation is 5%.



But anything can happen to make that simple calculation wrong – most likely we will see an overshoot past sustainable value just as we have seen on overshoot on the upside during the boom years. That’s the nature of markets, the madness of crowds, fear and greed and all those animal spirits coming to the fore.

So you have time to buy yet, that’s the only certainty in all this.


http://www.gmi.co.nz/Pages/MorganOnline.aspx?mid=2

[fungus pudding]

The big question: is it time to buy?

“Real estate agents say it’s a great time to buy now that prices have come down and interest rates are low.
You’ve been saying house prices have a long way to drop. What’s really going on, and how do we decide whether to jump in to the housing market or sit on the sidelines for a bit longer?”

Don’t listen to the real estate agents—they will always say it’s time to buy. Tell me when you last heard an agent imploring the public to sell up?

As to whether now’s the time, the correct answer of course is that it will be for some, and not for others – personal circumstances are often the most important determinant of timing decisions like that. Only you can make that call. But l won’t wimp out with that excuse.

In general, house prices have some way to fall yet. A couple of years ago I said publicly that they looked to be about 30% overvalued in terms of long term trends. Now we have the correction underway, I guess the call is to estimate how far through it we might be.

The graph shows the problem. The market peak was reached at $351,500 in September 2007. At last count (December 2008) prices had retreated 10.6% from that already, made up of a 6.5% fall in prices over a period where general inflation has totaled 4.6%. So simply on that long term trend analysis, you’d pick a further 17% to go in real terms until we reach fair, sustainable value. I’d guess that will take 24 months and be made up of a further fall of 15% in house prices over that time while inflation is 5%.



But anything can happen to make that simple calculation wrong – most likely we will see an overshoot past sustainable value just as we have seen on overshoot on the upside during the boom years. That’s the nature of markets, the madness of crowds, fear and greed and all those animal spirits coming to the fore.

So you have time to buy yet, that’s the only certainty in all this.


http://www.gmi.co.nz/Pages/MorganOnline.aspx?mid=2

I don't disagree with one word of his views on housing.