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  1. #411
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    Go online to Mitre10 or Bunnings. $7.95 tops. Even replacing the whole insides wouldn't cost $200. I've just spent a joyful week trotting back and forth to town until I got the right washer.
    They seem to replace the firms they deal with constantly as they spot a cheaper bulk-buy.

  2. #412
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    Quote Originally Posted by Joshuatree View Post
    But data from Stats NZ shows that, with some items, consumers are getting a better deal than they were 10 years ago.

    Things are far more
    disposable and become redundant quickly now though with many appliances, devices also designed with a short lifespan, parts cant be bought, the longevity of an "electrolux vacuum cleaner or PYE tv is replaced by short turnovers of the next best thing which undoubtedly are improved but we may now buy the same device 5 or 6 times the single purchase that it used to be. I was quoted $200( a 5 pack or nothing but still) to buy a simple flat rubber washer for my inbuilt toilet because they quickly replaced the model . Sorry a bit of a rave.
    Sounds about right. Cheaper but not once you buy two or three more than you would have in the past.

    And news from the reserve bank, a continuing price instability target of 1%-3% also now responsible for full employment. Not sure if NZ reserve bank works the same way as overseas but they could print money to buy govt bonds for govt infrastructure projects.
    Not sure but high inflation equals a booming economy therefore fuller employment. Sounds like a good reason to never raise interest rates even if inflation is above target. Looks like the NZ reserve bank has inflations back. Bad news for people who want price stability.
    https://www.newsroom.co.nz/2018/03/2...rice-stability
    All positive for inflation.
    Not sure why I care nothing I can do about it.

  3. #413
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    No interest rate change inflation wins again in fact to quote our new Reserve bank governor.
    The economy is well balanced, employment has been very strong, inflation has been low and stable.

    Per Adrian's own reserve bank website over the last year to 2017 4th quarter

    Housing 2017 up 6.4%
    Food 2017 up 2.3%
    Clothing down 1.7%
    Transport up 1.5%
    Wages up 3.1%
    General CPI up 1.6%

    I know the CPI is a basket of goods but if you take Food, Clothing, Housing and transport and give them equal weighting (ridiculous I know as we know how much housing is for those without a house or with a big mortgage) then inflation is 2.125% still less than wages increases I suppose. Although if housing had a 40% weighting then the reserve bank is just about touching the top end of its target.

    I think Mr Orr should raise interest rates if he wants to reduce housing unaffordability but he needs to keep them on hold if he wants to win the global currency wars and help our exporters.

    I guess I will just have to bite the bullet and mortgage myself to the hilt. I am going backwards. Interest rates on term deposits 3% savings accounts less than 1%.

    I just know something will change not long after I commit myself to something.
    Last edited by Aaron; 10-05-2018 at 04:17 PM.

  4. #414
    FEAR n GREED JBmurc's Avatar
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    Quote Originally Posted by Aaron View Post
    No interest rate change inflation wins again in fact to quote our new Reserve bank governor.
    The economy is well balanced, employment has been very strong, inflation has been low and stable.

    Per Adrian's own reserve bank website over the last year to 2017 4th quarter

    Housing 2017 up 6.4%
    Food 2017 up 2.3%
    Clothing down 1.7%
    Transport up 1.5%
    Wages up 3.1%
    General CPI up 1.6%

    I know the CPI is a basket of goods but if you take Food, Clothing, Housing and transport and give them equal weighting (ridiculous I know as we know how much housing is for those without a house or with a big mortgage) then inflation is 2.125% still less than wages increases I suppose. Although if housing had a 40% weighting then the reserve bank is just about touching the top end of its target.

    I think Mr Orr should raise interest rates if he wants to reduce housing unaffordability but he needs to keep them on hold if he wants to win the global currency wars and help our exporters.

    I guess I will just have to bite the bullet and mortgage myself to the hilt. I am going backwards. Interest rates on term deposits 3% savings accounts less than 1%.

    I just know something will change not long after I commit myself to something.
    Just put offer on another small commercial property going from current interest rates will make free cash flows 9k p.a overall yeild around 14% ... while money is cheap borrow into great yeilding assets IMHO
    "With a good perspective on history, we can have a better understanding of the past and present, and thus a clear vision of the future." — Carlos Slim Helu

  5. #415
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    Quote Originally Posted by JBmurc View Post
    Just put offer on another small commercial property going from current interest rates will make free cash flows 9k p.a overall yeild around 14% ... while money is cheap borrow into great yeilding assets IMHO
    Going out the risk curve to get the yields though. Commercial property at 14% must have some risk.

    In other news.
    Although I am more supportive of Labour this is disappointing.
    http://www.newshub.co.nz/home/politi...e-gearing.html
    Negative gearing only works because central banks basically guarantee price rises of 2% every year and they have done spectacularly well over the last 10 years well in excess of 2%. If you had actual price stability the people who negatively gear would just be losing money as they don't get the capital gain at the end and they actually have to pay back the money they borrowed instead of going interest only and letting inflation whittle it away.

    Look at the cause Grant Robertson not the symptom.

  6. #416
    FEAR n GREED JBmurc's Avatar
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    Invercargill ...personal rather have a fat yield than low if the market hits a wall can always reduce at renewal date.


    If your dealing with debt+investment there is always risks ...yeah if you can afford it go BUY a large very long-term MAIN CITY CENTRE Supermarket commercail building $20mill etc and get your 4%-5% ...
    Last edited by JBmurc; 17-05-2018 at 11:17 AM.
    "With a good perspective on history, we can have a better understanding of the past and present, and thus a clear vision of the future." — Carlos Slim Helu

  7. #417
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    I was looking at an apartment block with water issues coming up for a reclad. You don't know the final cost of the reclad (although I have an estimate) and you can't rent it while the repairs are being done so I thought this might be a good opportunity.

    Rent $400 per week $20,800
    Less rates 1,123.39
    less body corp 4,067.00


    Net rent(unconservative) $15,609.61

    Divide by 8% gets me a price of 195,120 expected price including repair costs 268,500 or 5.8% the difference in yield expectations is $73,380 I am assuming this is not seen as risky by most purchasers or is a 5.8% yield a high risk return these days?

    Sorry I didn't log in to discuss this but I was appalled at an article discussing wages and inflation. To quote.

    "According to the Reserve Bank, the cost of goods and services has grown about 19 per cent since 2008, while wages have grown by 30 per cent." This covers 2008 to 2018.

    and looking at the reserve bank website this is correct but I would note Food costs were about 20% but housing is 63%. What percentage of housing costs form part of your weekly budget. Not that much if you have a mortgage free house but renters and people buying today with a mortgage I would suggest this cost is close to 50% of their budget. Sometimes I think journalists don't try and put a perspective on things.

  8. #418
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    https://www.stuff.co.nz/business/105...es-ocr-on-hold

    Housing costs up 5.6% for 2017 (that's the latest the reserve bank website has) Not sure where Adrian Orr gets his data. It also mentions an "Average Compound Annual Rate" of 7.6% for housing. Not entirely sure what this means I assume it covers a reasonably lengthy time period.
    Wages were 2.8% and 3.8% respectively. I am not smart but I would assume this means a continuing housing crisis. No wonder the yanks are fed up with the status quo I think they are a bit further down the same road we are taking. Eventually we will start to see angry people in NZ as well but Adrian will have comfortably retired by then.
    I think we can work out one of the main reasons why there is a housing crisis easy money and low interest rates and a financial system designed to inflate away the debt. Only problem is that it isn't a free lunch and it looks like it might be hitting its limits at 1.75%. You would be hard pressed to find a short term term deposit rate that wasn't negative in real terms. Adrian is trying to force me out of cash but I am still hoping something breaks in the financial system and I can buy assets at a reasonable price in the near future, unless I am wiped out in a hyper-inflation or die in the meantime.

    Also interesting to read that 20% of the Auckland property market might be foreign buyers. The National Party didn't seem to think it was an issue.
    Last edited by Aaron; 28-06-2018 at 08:36 AM.

  9. #419
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    It is depressing to hear the economists talk about the lack of inflation while ignoring the massive asset price inflation of the last 10 years. What is more important long term? the opportunity to purchase wealth producing assets at reasonable prices or buying consumer products like iPhones that add little to your long term well being.

    https://www.stuff.co.nz/business/105...rates-unlikely

    I would speculate populist politicians will get more votes while society is held hostage by the financial system, further increasing inequality and promoting endless growth when there are concerns about climate change due to endless growth on a finite planet.

    I guess I am mostly mad because I am on the wrong side of this trade.

  10. #420
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    It might just be me on this thread but I am not the only one who thinks CPI statistics are bull**** for the average NZer. Although not quite sure what his conclusion is at the end as its a bit vague. Possibly he is pointing out a problem then concluding that wages should not rise or it will upset our current wonderful system I'm not sure.

    https://www.stuff.co.nz/business/105...treat-yourself

    My conclusion is that as long as you have capital(that isn't taxed) and a system designed for inflation we eventually create a divide between the rich and poor that becomes too difficult to breach. Like royalty, wealth might become a birth right. A bit early with the predictions but we seem to be progressing this way.

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