Good time to but property or just wait?

[fungus pudding]

I have owned properties in NZ for nearly fifty years which have all increased in value by at least 10% per year. In most instances tenants paid them off for me. It was the dumb investors road to riches. First home buyers should get the GST content of their first new home back and added to their deposit. On resale of the property they then should be forced to pay back the gst on the resale value. That would cost nothing in the long term and solve the first home buyer problem. Fergus

And increase the price of houses to the buyer, as will any similar scheme. (Give each first home buyer $50,000 and watch prices shoot up by $50,000) Prices settle to meet the average affordable weekly outgoings. Always. Consider the difference if interest rates were 15% compared to prices if interest was 1%. (your scheme is worse - it's an interest free loan)The best time to buy in the last 30 years was when interest was 24%. High outgoings, but small debt. The golden rule - interest rates and commodity prices are the opposite ends of a see-saw.

[JBmurc]

I have owned properties in NZ for nearly fifty years which have all increased in value by at least 10% per year. In most instances tenants paid them off for me. It was the dumb investors road to riches. First home buyers should get the GST content of their first new home back and added to their deposit. On resale of the property they then should be forced to pay back the gst on the resale value. That would cost nothing in the long term and solve the first home buyer problem. Fergus

Why I don't think we'll see the NZ property market during the next 30yrs anything like the last 30yrs is the growing gap in personal incomes to house values 16yrs ago I could buy a couple of average priced 3brm Invercargill homes from my Gross income....today I'd need to use nearly two years of my increased gross income just to buy one of the exact same homes ..so for me I'm 4-5 times worst off..( And I work in the export sectors / backbone of the economy)

Until NZ incomes grow I can't see the average income earner driving the property values higher anything like the last 30yrs

[fergus]

Why I don't think we'll see the NZ property market during the next 30yrs anything like the last 30yrs is the growing gap in personal incomes to house values 16yrs ago I could buy a couple of average priced 3brm Invercargill homes from my Gross income....today I'd need to use nearly two years of my increased gross income just to buy one of the exact same homes ..so for me I'm 4-5 times worst off..( And I work in the export sectors / backbone of the economy)

Until NZ incomes grow I can't see the average income earner driving the property values higher anything like the last 30yrs

don't you think the difference is the 15% gst tax plus the ridiculous compliance costs incurred before you even stick a spade in the ground. I would venture to speculate that in comparison to thirty years ago that alone raises the cost of a new house by at least thirty pc. Deducting that thirty pc would bring back in line what a house should cost. Fergus

[neopoleII]

just had a look at property prices in USA.
plugged in $100 k California and got......
http://www.century21.com/property/82...05-CBR17676276
then looked at trademe and $100 k got ....
http://www.trademe.co.nz/property/re...-633135338.htm

the sad part is..... the USA house was one of 10s of 1000s at this price range, and the NZ one, was one of a handful.

what i noticed is that NZ housing is very expensive full stop.
and we have only 4million folks!

something is very wrong.......
even our minimum wage is a lot higher too.
compared to the rest of the world....... we are an expensive empty country with a serious property affordability issue.

[fergus]

just had a look at property prices in USA.
plugged in $100 k California and got......
http://www.century21.com/property/82...05-CBR17676276
then looked at trademe and $100 k got ....
http://www.trademe.co.nz/property/re...-633135338.htm

the sad part is..... the USA house was one of 10s of 1000s at this price range, and the NZ one, was one of a handful.

what i noticed is that NZ housing is very expensive full stop.
and we have only 4million folks!

something is very wrong.......
even our minimum wage is a lot higher too.
compared to the rest of the world....... we are an expensive empty country with a serious property affordability issue.

The price of compliance plus the 15% gst on the whole package plus the ridiculous scaffold requirements plus the insulation that they don't insist on in other countries. I could carry on bleating about the crazy building code due to the leaky homes debacle but what is the point. I would venture to say that NZ builders are prone to going bankrupt more so than any other business venture. Blame GST and your tax system, then blame the incompetent people who devise the building code. The poor builders are caught between a rock and a hard place. Fergus

[neopoleII]

heres another example of nice property at a good price in a rich country.
http://www.remax.de/Detached-Family-...z_330491001-31
while here in NZ we spend our income on servicing huge mortgages or rents on average houses in an empty country.
im guessing the owners of the house in this link earn good money and have plenty of dosh left to enjoy a real life.
guess thats why they have a strong manufacturing base..... the locals have money to spend on things...... creating employment.

the more I search 100k houses in the world, the more I realise there is a serious problem in NZ and we are in a balloon, not a bubble.
or......... NZ is the best country in the world and everyone is heading down here to escape the "rich countries"
I guess I am missing something.

[skeet]

I just bought my first home with my fiancé. $405k in Halswell, deposit just under the 20%, including about 32k Kiwisaver. Managed to get the fee wiped for being under the 20% and they have given us $1500 for legal fees. Locked in a interest rate for 2 years, and some on floating that we plan to wipe off within the next two years.

Overall based on my experience there isn't a housing crisis in Chch. We looked at 5-6 houses in total, made an offer on one that was accepted on the same day. All within a month of deciding we wanted to buy a house. Once the offer confirmed we have had a few dramas with Lim etc but nothing too unexpected.

I guess our experience isn't the norm, I have a friend that has been to 66 open homes so far!

[winner69]

Some interesting charts

http://www.nbr.co.nz/article/housing...ll-us-dc-15661

[fergus]

heres another example of nice property at a good price in a rich country.
http://www.remax.de/Detached-Family-...z_330491001-31
while here in NZ we spend our income on servicing huge mortgages or rents on average houses in an empty country.
im guessing the owners of the house in this link earn good money and have plenty of dosh left to enjoy a real life.
guess thats why they have a strong manufacturing base..... the locals have money to spend on things...... creating employment.

the more I search 100k houses in the world, the more I realise there is a serious problem in NZ and we are in a balloon, not a bubble.
or......... NZ is the best country in the world and everyone is heading down here to escape the "rich countries"
I guess I am missing something.

What you must take into account is you cant compare oranges with apples, when comparing house prices in different countries . Some countries have houses hundreds of years old still in great condition, we don't. Most countries don't place a 15% tax on everything before it gets built we do. We build houses to last a hundred years, other countries build houses that last centuries. I can buy wooden garden manufactured furniture cheaper than I can buy the timber to make it. Simple solution to fix the problem is a new first home should be GST free paid back at change of ownership with that written into the title. That would cost nothing in the end, with the GOVT slightly better off with a higher GST take at the point of sale. The building code in NZ has been over the years devised and amended by idiots, but I wont go into that at this point. FERGUS

[GTM 3442]

Simple solution to fix the problem is a new first home should be GST free paid back at change of ownership with that written into the title. That would cost nothing in the end, with the GOVT slightly better off with a higher GST take at the point of sale. FERGUS

Out of curiosity, how would it cost nothing? The last time I paid nothing for something, it ended up costing me quite a bit of something.

Also out of curiosity, how would the GST be higher at the point of sale?

And because I'm having a fit of naivety, lots of governments have tried lots of things to "fix" their housing markets. Not a lot of them seem to have worked. In fact I think you could count the successful ones on the fingers of no hands.

Nobody seems to have tried building lots of houses - so that supply better matches demand. Can someone please explain why it's not that simple. (simple language please)