NZ 1st homebuyers are ScReWeD...

[coge]

Shrewdie, folks have been saying what you have just stated about forests for decades in NZ. Unfortunately our main forest products are not that well respected abroad. Can't see that changing anytime soon. Plus the ongoing costs of maintaining forests, & long years of no return. What about the exchange rate come harvest? Also you have to trust Govt not to hijack your investment, which with all the global warming bunk is looking more likely. I wouldn't touch them with a ten foot pole. Too much risk over the long term.

[Crypto Crude]

quote:Coge-I wouldn't touch them with a ten foot pole

dont you mean a 10 foot christmas tree...
ok... I feel your response...
Im just thinking about how I gonna reinvest my heafty share profits going forward....
guess I have to sit back and watch the hefty share profits first....
just thinking through the diversification approach at this stage, as I have no diversfication and I have no spare cash... and I willnot sell my pretty shares...
although I would sell my shares for a falling property market...
peace out...
[8D]
.^sc

[Crypto Crude]

I have not seen anyone mention this important indicator yet about interest rates.... I read a month ago that analysists are putting 50% chance of one more OCR rise this year... Looks like we will see peak interest rates year end, with rates falling next year...
good news for non buyers here...

quote:
reserv
e Bank raises OCR to 7.75 percentDate 26 April 2007

The Official Cash Rate (OCR) will increase by 25 basis points to 7.75 percent.

Recent indicators confirm that the resurgence in economic activity that began in late 2006 has continued over recent months, with domestic demand continuing to expand strongly. As we noted in March, demand is being fuelled by a buoyant housing market, increases in government expenditure, a rising terms of trade, ongoing net immigration, and a robust labour market.

The lift in domestic demand is placing further pressure on already-stretched productive resources. Firms report that capacity is very stretched and that they are again experiencing increased difficulty in finding both skilled and unskilled staff. Consistent with these pressures, non-tradables inflation has remained persistently strong and has recently shown signs of re-acceleration.

The trade-weighted exchange rate has risen further, which will exert some downward pressure on medium-term inflation. The exchange rate is now at levels that are both exceptional by historical standards, and unjustified on the basis of medium-term fundamentals. Parts of the export sector continue to face challenging conditions, but the recent sharp lift in world dairy prices is expected to provide a boost to incomes in that sector and tourist arrivals are continuing to grow.

There has already been a recent rise in fixed mortgage interest rates. This further increase in the OCR is aimed at ensuring that inflation outcomes remain consistent with achieving the target of 1 to 3 percent inflation on average over the medium term.

bring on 8... slow house price growth... indicators pointing at downturn....

[Jess9]

Not likely, but...if the budget springs a new tool for the RB to target/hit neg. geared res. prop. investors with, that my steepen the start of a slump into a quick plunge, e.g. see what happened in Sydney.

[delgary]

Something to think about.


First-home buyers waiting for property prices to drop have left their run too late, BNZ chief economist Tony Alexander has warned.


Alexander yesterday told a Parliamentary select committee inquiry into home affordability that the pleasure that had come from high employment and job security had bolstered the housing market – and caused pain for renters wanting to take their first step on the property ladder.

Just as employers had been "hoarding" staff in a tight labour market, where previously they may have been laid off, property investors would continue hoarding property as long as they believed values would not substantially drop, he said.

Government plans to help first-home buyers through Kiwisaver and a proposed shared-equity scheme could instead have the obverse effect.

"These things ... will tend to place upward pressure on the prices and again discourage investors from what might be the normal liquidation of some of their assets."

Alexander agreed with other economists that economic indicators suggested an imminent cooling of the housing market – but that did not mean a return to affordable housing apparent before the present housing boom.

"If we get a bit of weakness in the housing market these days, you've got a backlog of people who are going to jump in.

"There was this feeling three or four years ago, to rent for a couple of years till things get cheaper then buy. I don't think people view that now at all."

The commerce select committee is expected to report on the findings of their inquiry by August.

Just as Westpac chief economist Brendan O'Donovan told the committee last week, Alexander said there was no one solution to making housing more affordable.

He said a lift in net migration, lower and more stable interest rates and rising construction costs all accentuated the problem.

He recommended the committee look at the supply side of the market, such as freeing up more land for housing or boosting public transport options to areas of cheaper housing.

Council of Trade Unions president Ross Wilson laid the blame for housing prices outstripping wage rises squarely at the feet of big banks.

"They are borrowing huge sums offshore, driving up the current account deficit and helping fuel house-price inflation that is forcing houses way out of reach for workers trying to buy their first home."


http://www.stuff.co.nz/thepress/4055041a6427.html

[Bel]

What would the effect of Government/Council's suddenly freeing up huge tracts of land for residential use on the property market? Afterall they are currently restricting the supply.

Would Aucklanders et al still continue to look for property investment in cheap places? (such as invercargill)

[Crypto Crude]

The housing stock is fixed in the short term, but over time as these houses gets built then supply increases which inturn puts downward pressure on house prices depending on the amount of houses being built... downward pressure would be minimal as population growth/immigrants would fill them up...
and a new developed area of residental would make stuff all difference to total number of houses...unless it was a major project undertaken...
IMO only...
[8D]
.^sc

[Crypto Crude]

WOW MUMMA... A NOOSE AROUND THE NECK NOW
Reserve Bank raises OCR to 8.00 percent
Date 7 June 2007

The Official Cash Rate (OCR) will increase by 25 basis points to 8.00 percent.

Reserve Bank Governor Alan Bollard said: “Domestic demand has grown strongly since late 2006, particularly in the household sector. Housing market activity has been buoyant, consumer confidence has remained relatively robust and a range of business sector indicators, including employment and investment intentions, have been strong. As we have noted recently, government spending continues to increase, which is contributing to domestic demand.

“Following several years of strong growth, firms have indicated that capacity remains stretched and that finding both skilled and unskilled staff has become increasingly difficult. These pressures continue to underpin inflation.

“A sustained period of slower growth in domestic activity will be required to alleviate inflation pressures. Lending rates have risen significantly in recent months, partly due to previous increases in the OCR. Given the usual lags, we have not yet seen the effect of these increases on domestic demand and inflation pressures. There are some early indications from recent opinion surveys and other data that growth may be starting to soften, but these are by no means conclusive. Indeed, at present the risks to domestic activity appear to remain on the upside.

“A significant development in the past six months has been a marked increase in dairy prices. While there are uncertainties about the future path of these prices, the increases will assist in narrowing New Zealand’s trade deficit. The rise in dairy sector incomes will provide a substantial boost to economic activity over the next few years, but will also add to inflation pressures.

“Parts of the export sector outside the dairy industry will continue to face challenging conditions due partly to the New Zealand dollar. As we noted in April, the exchange rate is at levels that are both exceptionally high and unjustified on the basis of New Zealand’s medium-term fundamentals.

“Had we not increased the OCR this year, it is likely that the inflation outlook would now be looking uncomfortably high. This further increase in the OCR is to ensure that inflation outcomes remain consistent with achieving the target of 1 to 3 percent inflation on average over the medium term.”
[8D]
.^sc

[Crypto Crude]

WOW MUMMA... A NOOSE AROUND THE NECK NOW
Reserve Bank raises OCR to 8.00 percent
Date 7 June 2007

The Official Cash Rate (OCR) will increase by 25 basis points to 8.00 percent.

Reserve Bank Governor Alan Bollard said: “Domestic demand has grown strongly since late 2006, particularly in the household sector. Housing market activity has been buoyant, consumer confidence has remained relatively robust and a range of business sector indicators, including employment and investment intentions, have been strong. As we have noted recently, government spending continues to increase, which is contributing to domestic demand.

“Following several years of strong growth, firms have indicated that capacity remains stretched and that finding both skilled and unskilled staff has become increasingly difficult. These pressures continue to underpin inflation.

“A sustained period of slower growth in domestic activity will be required to alleviate inflation pressures. Lending rates have risen significantly in recent months, partly due to previous increases in the OCR. Given the usual lags, we have not yet seen the effect of these increases on domestic demand and inflation pressures. There are some early indications from recent opinion surveys and other data that growth may be starting to soften, but these are by no means conclusive. Indeed, at present the risks to domestic activity appear to remain on the upside.

“A significant development in the past six months has been a marked increase in dairy prices. While there are uncertainties about the future path of these prices, the increases will assist in narrowing New Zealand’s trade deficit. The rise in dairy sector incomes will provide a substantial boost to economic activity over the next few years, but will also add to inflation pressures.

“Parts of the export sector outside the dairy industry will continue to face challenging conditions due partly to the New Zealand dollar. As we noted in April, the exchange rate is at levels that are both exceptionally high and unjustified on the basis of New Zealand’s medium-term fundamentals.

“Had we not increased the OCR this year, it is likely that the inflation outlook would now be looking uncomfortably high. This further increase in the OCR is to ensure that inflation outcomes remain consistent with achieving the target of 1 to 3 percent inflation on average over the medium term.”
[8D]
.^sc

[Dazza]

TIMMMMMMMMMBER

shrewd u got ur cash ready

this is soooooo sweet

come on all u middle aged scrouges FEEL THE BURN BURRRRN OF THE INTEREST RATES
A

time for us young fellas to get ready to POOOOOUNCE :d
MUAHAHHAH