NZ 1st homebuyers are ScReWeD...

[shambles]

Yes

I expect rental yields will increase when/if interest rates increase

And once yields are more attractive, house prices will appear cheap, off we go again... When do you expect inflation to really start kicking back in?

[Mick100]

And once yields are more attractive, house prices will appear cheap, off we go again... When do you expect inflation to really start kicking back in?

Yes - but this proccess is going to take years to play out
another thing - if you can get 10-12% on bank deposits then a 10% yeild on a property will not appear that attractive to you

I expect inflation to begin to pick up late this yr-early next yr (slowly at first). Commodity prices are beginning to pick up-particuarly copper- which is a good leading indicator that inflation is around the corner

[shambles]

another thing - if you can get 10-12% on bank deposits then a 10% yeild on a property will not appear that attractive to you

Good point - I guess that's where depreciation and gearing comes in handy,

[Mick100]

Good point - I guess that's where depreciation and gearing comes in handy,

Gearing up may not be as apealling when ther are no capital gains to be had - what's the point?

I think property is going to become a yeild play rather than a capital gain play as it has been for a very long time - i'm reffering to the next five to ten yrs

[shambles]

Gearing up may not be as apealling when ther are no capital gains to be had - what's the point?

I think property is going to become a yeild play rather than a capital gain play as it has been for a very long time - i'm reffering to the next five to ten yrs

I agree, yield will be crucial through the next stages - as well as strategic portfolio building through clever buying and adding value cheaply.

The game has changed, I certainly don't expect to see cap gains like the speed of 02-07's soon, or perhaps ever again.

[George]

If nominal property prices stay the same for next say, 3 years,
a first home buyer waiting for a downturn will still have to
pay the same amount as today. Our 300k house may still be at
the same price but we will only have 145k to go plus another 20-30k
to take off principal if we can save that extra.
A first home buyer will be behind in 3 yrs under that scenario
unless he/she is working hard and saving as if they already
had a mortgage so as to have about 150k in the bank for a deposit.
George

[lakedaemonian]

I agree, yield will be crucial through the next stages - as well as strategic portfolio building through clever buying and adding value cheaply.

The game has changed, I certainly don't expect to see cap gains like the speed of 02-07's soon, or perhaps ever again.

I think I'm in agreement here.......

I see residential/commercial yield's climbing while property prices continue to fall.

Our first local "3 in a row for sale", all have sold signs on them!

A couple of the young folks I've been working with over the last few years in trying to get them savings and patiently waiting are now deep in their search for homes.....one is about to pull the trigger with a few offers after spending the last 6 months deeply researching their targeted suburb.

I still think they are moving too soon, but they are basing their buying decision on staying in the home long-term, high deposit, low multiple of wages...so they are buying WELL within their means......so I can see their perspective.

Our ongoing saga with our last commercial property has ended...after eleventeen offers collapsing due to inability to find finance, we finally have one that has gone unconditional....transacting next week....we're selling under 8%.....5-1 point higher than last year, but FAR better than the 10-12%+++ that's coming down the track.

Commercial has some movement very recently, but without VERY strong national tenants and LONG leases not much is actually moving in my opinion.

Just my 0.02c

[The Great Gold Guru]

Must be a few peeved dairy farmers in your neck of the woods Lake ... Westland have had a shocker season and looks like payout might be as much as 80c less than Fonterra , that hurts ! How much has dairy land fallen from the peak in your opinion ... $5k/ha-10k/ha ?

[lakedaemonian]

Must be a few peeved dairy farmers in your neck of the woods Lake ... Westland have had a shocker season and looks like payout might be as much as 80c less than Fonterra , that hurts ! How much has dairy land fallen from the peak in your opinion ... $5k/ha-10k/ha ?

Hard to say about land values......they are certainly not moving many properties at the moment.....the good news is:

Westland still has the cheapest "value for dollar" pasture in the country.

The Westland co-op members I know, while a bit upset about the payout, are fiercely loyal to the company.

They made a stuff-up.....but it's still a great outfit

Personally, this is a challenging year of course......but we have been driving down our cost of production incredibly fast.

We are just over $4 KG to produce, we will likely end the season with a loss this year

But we will probably be in the high $3's cost of production next season.

Early signs of commodity inflation are good news for us.

My best GUESS is payout will be solidly in the $6's within 2 seasons, making VERY good money again.

Quite a tough season, but the switched on farmers are grinning like cheshire cats at the opportunities going forward.

Some I talked to are thinking about smart farm consolidations that make sense.

We are looking at a POSSIBLE merger of a couple properties that, if we can agree on valuations, could see us with even greater economies of scale and lower cost of production if we can get the stars in alignment.

I'm scratching my head on farm values though in the short-to-medium term

Exciting times!

[minimoke]

Well Shrewdy, your $330k home would now be worth $340k. Third month in a row of increased value.