By Bernard Hickey
Auckland's property bonfire was the centre of attention this week and for all the right and wrong reasons.
Firstly, as foreshadowed in this column last week, a land mine went off on Tuesday under the Government's strategy of trying to douse the fire with extra housing supply.
Deputy Mayor Penny Hulse essentially said 'No Mas' to the Government's drive to set up Special Housing Areas all over and around the city, and in particular, on 'Greenfield' sites outside the Metropolitan Urban Limit.
Ms Hulse spelled out publicly for the first time why the Council's Development Committee decided confidentially last month to suspend approval for three Special Housing Areas near Huapai in West Auckland with 230 sections.
Residents had revolted at the prospect of thousands of new residents trying to use their blocked North Western motorway without a new busway and better public transport being built first, she said.
The Council also wanted Government funding to help pay for the roads, water and electricity supplies needed for all these extra sections, she said.
Finally the cat was out of the bag. After years of publicly going along with the Government's push to go both 'up' with more intense central city developments, and 'out' with more greenfield developments, the Council had decided it would only approve new Special Housing Areas in brownfield areas and had suspended its consideration of 45 other areas.
The Council's genetic pre-disposition for a 'compact' city with a clearly defined Rural-Urban Boundary was dragged out into the open. The reflexive opposition to 'sprawl' finally showed its teeth.
Ms Hulse argued it was not fair on existing ratepayers that they fund the extra infrastructure needed 'in between' the new areas, which can't be directly funded through development contributions paid for by developers and passed on to home buyers.
On the face of it, this argument is seductive. After all, why should Auckland ratepayers minding their own business pay rates hikes that are nine times faster than inflation because the central Government could not or would not control an unprecedented net migration surge? Surely, ratepayers huff, that's not our problem to solve with our money.
The problem for Auckland ratepayers is that sympathy is wearing very thin north of Orewa and south of the Bombay Hills.
Housing Minister Nick Smith put the counter-argument most aggressively, saying taxpayers in Invercargill would not be keen to pay for Auckland roads and buses when the Council itself was cutting its road transport budget to fund its train project. What he did not say out loud is that property owners outside of Auckland and Christchurch who have seen their property prices stagnate in the last 7 years would much prefer all those newly rich Auckland property owners spend some of those riches on their own roads and buses.
Smith then went on to warn Hulse the Government had the right under the 2013 Special Housing Areas Act legislation to over-ride the Council and directly approve these greenfield areas. He said such a takeover was unlikely and Prime Minister John Key was at pains to be more conciliatory, but the threat was left hanging there for all councillors and ratepayers to see.
Meanwhile, the bonfire raged on through the week.
Barfoot and Thompson reported later on Tuesday the median sale price in Auckland rose NZ$42,500 in the month of April alone and was up 21.6% from a year ago. There were 314 homes sold for more than NZ$1 million in the 30 days of April, which was exactly double the number sold for less than NZ$500,000. Barfoot and Thompson itself collected almost NZ$1 million a day in commissions through the 61 days of March and April. New mortgages to landlords grew 46% to NZ$2.1 billion in March from February.
(Graph shows Monthly house sales by buyer type. Source: Corelogic NZ, REINZ, RBNZ estimates)
By the end of the week rental property investors were sitting pretty at the fireside.
They would have smiled on Monday when Mr Key downplayed again the prospect of any Australian-style restrictions on foreign buyers or any Victoria-style taxes on foreign buyers.
They would have grinned from ear to ear as the Governments responsible for encouraging new house building squabbled on Tuesday over how to pay for pipes and roads while the shortage of 25,000 dwellings grew ever larger.
Later on Tuesday, landlords would have given a little fist pump on hearing Labour Leader Andrew Little give his strongest opposition yet to any suggestion of a capital gains tax. Fresh from 20% rise in prices, those landlords who bought a NZ$600,000 rental with a 60% mortgage a year ago are sitting on a tax-free gain of 50% on their equity and are newly confident that, even with a change of Government, that they will not have that gain taxed.
They basked in the knowledge by late on Wednesday after weak wage inflation data that the Reserve Bank is now expected to cut the Official Cash Rate twice before the end of the year.
On Thursday and Friday they would have rejoiced in the knowledge that 100 new migrants arrived in Auckland on each of those days to either rent or buy a house. It was the same on Monday, Tuesday and Wednesday.
By Sunday, those landlords could celebrate again as they have seen the value of their property rise another NZ$7,000 in a week.
In the last year Auckland has found a recipe for a bonfire of the properties: just add 100 migrants a day to a shortage of 25,000 houses, throw in the prospect of a couple of rate cuts and then take away any prospect of a capital gains tax or foreign buyer restrictions. Then light the touch paper and stand well back.
This week everyone in New Zealand heard the whoomf and then felt the heat of Auckland's property market going up in flames. Many cheered, but not everyone.
And certainly not the Government, the Reserve Bank or the myriad of first home buyers and renters in Auckland who saw house prices rise 9.7% or NZ$67,000 in the last three months over the same time as their wages rose 0.7% or NZ$7.50 a week.
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A version of this article has also been published in the Herald on Sunday. It is here with permission.
121 Comments
I would suggest the biggest accelerant to the property market fire is John Key. He just isn't a fireman.
He has proven over seven years he doesn't have what it takes to put out the property market fire. In fact he is probably quietly getting praise from the rentiers, specufestors and bankerators for his prowess in fire making.
I don't think it is particularly relevant whether Andrew Little supports CGT or not. He cannot influence the property market for the next two and half years. The question then will be whether he and his party has the political will to do what it takes to bring the property market under control. This will require a combination of supply and demand measures. Not just one single policy of dubious value -CGT.
In the meantime, unless John Key finds a fireman's hat and the political will to implement structural reforms to the housing market fire will rage on......
Not all of us property investors are evil, cold hearted speculators. The market is the market. Back in 2008 when I started investing in Auckland things weren't flash. Fear and greed are what drive booms and busts. There will be a correction at some stage and the speculators will burn while others will survive. My pick is there probably another 18-30 months of boom to run before something scares the life out of the market. Happy Mother's Day everyone
Thank you for continuing to remind us of that simple fact. A simple fact that eludes the policy-makers in government and Auckland Council.
I am not comfortable with all the moralising against investors, developers even land-bankers. Central and local government have carefully constructed a system more or less guaranteed to deliver windfall profits to these people. Why shouldn't they take advantage?
It's time for the policy makers to do their jobs properly if they don't like the current outcomes of their inaction.
We would be naive to think there is not hundreds/thousands of property investors, landlords, real estate agents, salesmen for the finance industry -bank economists... that make up the rentier class encouraging the John Key administration to do as little as possible to control the bonfire. Many of this group will be big donators to the John Key cause. They will be attending the $5000 dinner nights in Auckland......
The concentration of wealth that booming property prices causes is part of a feedback loop between a government that inadequately regulates the property market and economic actors who rationally take advantage of this fact. The whole thing is distorting our democracy.
May I present an idea that could go a long way towards solving the Auckland property/housing problems? It is relatively inexpensive, AND could be implemented in the next few months.It is old tech, tried and true. Here goes....
Buy, (say 1000?) new passenger buses (beautiful, comfortable buses with wifi etc). Bus fares are the inverse of traffic congestion. ie, during morning and evening rush hour the fare is "FREE" or "gold coin donation". As the traffic clears, bus fares can increase. As congestion increases, bus fare drop in response (sort of Uberish)?. There could even be an algorithm that calculates/changes bus fairs hourly, every day?
The pros
High speed travel into the city from outlying districts.
Restful and maybe productive commuting time.
Less traffic for those who need to take a car or truck into town for whatever reason.
Ecological use of existing infrastructure. (mitigate the pressure to build more road and rail- let's efficiently use what already exists).
There are measurable benefits to commuters from a bit of walking as a result of bus travel.
There are emotional benefits to many people from being part of a group of other people.
Being "buses", the bought infrastructure is completely flexible. Again, using algorithms, buses can be sent to where passengers are, and withdrawn from routes that are little used. Buses can be bought if more are needed, and sold if demand drops.
I can not think of any risks or pitfalls? It could mess up the existing bus/rail business plan- but that is easily incorporated? I have been thinking about this for a few years.
We could even have roads that are exclusively for buses and bicycles during rush hours? We have all of this computer power and centrally controlled signage. Why not manage our roading system the same way the internet manages information? ie monitor traffic all over the city and actively manage the flows? Housing is a huge problem because of commute times for the outlying communities.
Also, buses could be battery powered in the inner city.
Great idea. I’ve often wondered about making public transport compellingly cheap on routes where there is excessive congestion. Any operational losses from this should surely be offset by deferring or reducing infrastructure capex and the economic value of wasted hours spent in traffic. Has anyone done this analysis?
One tiny flaw in the Hulse argument. If the vision for the future Auckland was so compelling, Auckland ratepayers wouldn't mind stumping up to get that city.
If the ratepayers are unhappy about paying for Brown/Hulse's version of a future city then what are Auckland Council doing trying to ram it down their throats?
The not so thankful.
It is dark when Sarah Topsom wakes her children and it is dark when they get home.
On a good day the alarm sounds at 5.15am, on a bad day it is 4.30am.
Their daughters are dressed and bundled into the car. It can be up to two-hours in peak hour traffic to travel from Army Bay, north of Auckland, into the city centre.
Once they arrive at work the children can be in daycare from seven to 11 hours before the journey home. Read more
Is it true that National and Auckland City Council are fighting for the rights to use this song
https://www.youtube.com/watch?v=Re4chLDlNLY to promote the housing accord?
Auckland is the powerhouse of our economy. The fact that Auckland is growing is good for the country as a whole. Anyone who objects to contributing towards the costs of Aucklands growth is short sighted. The benefits of a bigger Auckland will trickle down to the provinces. More people, more tax intake, more economic activity, more money to spread around the country for healthcare etc. Unless of course the provinces want to fund their own healthcare. Didn't think so.
... I am awaiting the day that our good friend Bernard Hickey announces to the world ( via an article in the NZHerald first , interest.co.nz second ) that he has had a tortuous weekend , searching deep into the far flung recesses of his economic soul , and that he has had to completely overhaul everything he previously hung so dearly onto ... and his economic theories as well .... and that he now realizes that Auckland house prices are actually horrendously undervalued , and ought to by rights go upwards 30 % in the next 12 months ...
... then , boys and girls , we will know for sure that the end is nigh ..... SIGH !!!!!!!
So your house value is increases by 20%.
This is only a paper until you sell.
You borrow against this paper value and buy a whole pile of imports with that borrowed money and the whole of NZ should be grateful to you.
In case i am wrong
Can you give me an example, how i, a South Islander, better off because the value of your house is increasing?
Sounds like you use the same economics as John Key.
Hence why I dont consider the value of my house in my NET worth, it cant be realised.
I can be cynical and say the the increase in the value of housing keeps ppl feeling "rich" and hence spending and hence the tax take is kept up. Otherwise heaven forbid we'd actually have to make and sell something, but then we'd be in the sector seeing 1% deflation, bound to end well. So yes indeed the economics of JK, in a way...ie they are all like this. I mean take the Greens, when the 4 want to be co-leaders had a 'debate" none of them could answer basic economics questions like what is the OCR, yet they want a "green sustainable economy". La La land the lot of them IMHO.
The problem is that money ISN'T spread around the rest of the country. Creating a poverty, not just poor, but poverty which reduces economic ability, in the rest of the country.
The money made in Auckland, stays in Auckland, often as financial or property based instruments, creating huge inflation there and not doing anything at all to help the rest of the country. That localised inflation drives down the value of profits and wages.
You can see this in two very noticeable places:
1) An Auckland professional career has a huge salary, many times that of the rest of the country (eg My farm, 64ha, with two 5 bedroom houses, $2.2 million. What will $2.2 million get you in Auckland?)
2) Problem is that to have anywhere near that level of career income, the professional has to be IN Auckland. The career does not exist outside Auckland because no other local economy in New Zealand has the funds left to support it's economic fundamentals (ie a specialist lawyer needs specialist clients and works as part of a team, the rest of New Zealand doesn't have the money to have that much litigation)
http://www.nzherald.co.nz/opinion/news/article.cfm?c_id=466&objectid=11…
Of course Bill English will do nothing or if he does anything it will have little or no effect.
As I see it with perhaps 12 to 18 months before the big bang, it can only devastate one party so if they do nothing now it will be too late . So leave things as they are now.
Hallelujah!
after watching yesterdays news on the people parking all night for land it so reminds me of the sharemarket crash and the dotcom crash and the prime loans crash.
It's a good time to remember one of Warren Buffett's classic rules: "Be fearful when others are greedy, and be greedy when others are fearful."
Stupidity-in-Action
Reality Check
Huapai - 3 Special Housing Areas ear-marked for Huapai in West Auckland
Anyone round here been to Huapai?
Residents revolted at the prospect of thousands of new residents trying to use their blocked North Western motorway without a new busway and better public transport being built first
Any of the commentators ever been there. Seen it? Looked at it?
Anyone here ever tried travelling Auckland-CBD-Huapai during peak-hour up the NW-Motorway?
Doubt it somehow
The North-Western Motorway used to be 2-lanes wide, terminating at Te-Atatu
Then it was widened to 4 lanes and extended through to Hobsonville Road
However there has/had always been a bottle-neck at Lincoln Rd interchange
How many years did it take to re-engineer the Lincoln Road interchange?
The NW motorway was a 5 km long carpark during the PM rush-hour
Lincoln Rd was a carpark during the AM rush-hour from 7:00 am thru 10:00 am
Has it been fixed yet?
Did the re-engineering fix the problem?
If you look closely at the map you will find an un-used rail-line running right thru Huapai
That rail-line is single tracked
The line from Auckland CBD-Swanson is double tracked through to Swanson
The metro-rail commuter service only goes to Ranui then stops
How many kilometres from Swanson-Ranui to Huapai ?
10 kms? - The rail line is already there
The answer is self-evident
The talk is about roads while the rail infrastructure already exists
Has existed for many years
Re-open the line to Huapai and run a connecting rail-car sevice to Swanson
Every 10 minutes
Go to google maps
https://www.google.co.nz/maps/@-36.771562,174.537764,3a,75y,100.14h,87…
There is the rail line still there
Lived out West for four years 25 years ago and the missus used the Northwestern to get to the CBD. Trip from Hobsonville to CBD was 25 minutes, but in rush hour double that. The really nice thing about coming come along the Northwestern is that you get to enjoy the last rays of the sun before it sets, right in your eyeballs.
Still cruise through that way occasionally although avoid the rush hour. Yes the rail line still operates out west to Helensville and Kaukapapa before heading inland to Tahekaroa and through a tunnel to come out inland from Warkworth. SH1 upgrade coming will have to deal with the same hill, although I believe they are going over it.
Plenty of good flat land out West, but flood prone. Have seen SH16 under water and blocked at Kaukapapa. There isn't much separating Riverhead from the Kaipara River.
I remember back in Feb 2007 all seemed wonderful for property investors and home owners. Via the Herald the REINZ CEO said the outlook for property was fantastic. Mark Weldon said the future of stocks looked great with no foreseeable problems on the horizon.
Seven months later in Sept 2007 the GFC started and everything these "experts" had said was meaningless. Also these so called experts usually had vested interests. Recently I've noticed various bank CEO's offering their advice on how positive the outlook is for NZ housing. Banking staff are like all business people who seek profit for their establishment and as such, are sales people. Why would anyone listen to the investment advice of a sales person?
All might seem well for those exposed property investors but one thing I've observed regularly throughout life is the wheel of fortune keeps turning. I suggest the 'gloating property investors' eat some humble pie as no one knows precisely what lies around the corner. It appears history may not repeat itself exactly, however it does rhyme. And for anyone who understands property cycles, they know what is coming.
I remember you saying that you were a property investor Triple... But you sold up in Auckland some time ago to avoid the 'impending' crash... Now your kicking yourself that you didn't hold on longer and desperately trying to convince yourself that a crash is just round the corner so you can get back in and right your wrongs... Is that about the crux of it...
I am a property investor Happy, that is why I understand property cycles. Do you? I still own real estate in Auckland but I currently prefer commercial real estate to residential.
I never "sold up" in Auckland - I owned an apartment on the waterfront as my home. However my wife and I had a baby last year and the apartment was no longer appropriate so it was sold. Is that ok with you Happy? Or do I need your prior approval to have a child and sell my apartment? How about you play the ball, not the man - tough guy.
If you still favour buying, then please by all means continue purchasing residential property in Auckland. I look forward to the opportunities which lie ahead.
Do I understand cycles... I've been picking this boom since 2011, correctly. I still remember your cherry picking of figures late last year when you were saying the market had peaked and now were another 10% up.
"...play the ball, not the man..." What did you write in your first post "gloating property investors eat some humble pie..." So now you're a cherry picker and a hypocrite.
Here's another expression.. "People in glass houses..."
Happy, once again you choose to ramble on about some meaningless disagreement which serves no purpose. Why don't you present some facts to support your position? If you disagree about my writing of the Feb 2007 Herald comments made by so called "experts" then go into Auckland library (I think its 4th floor) and look at the stored Herald articles on microfiche. Prove me wrong! But you cant can you, because you know I am writing the truth.
Last year after the RBNZ hiked rates four times the market did slow - i.e. the B&T auction rooms were between 1/4 to a 1/3 full. So that was a considerable slow-down and I just reported what I observed. Nothing more and nothing less. However later in 2014 & 2015 the banks all started to drop their fixed lending rates and the market took off again. Again I am only saying what took place.
I am not a gloating property investor and in fact I am very cautious. I am also not a hypocrite. You on the other hand are nothing more than an angry ant - so how about you pick a pointless disagreement with someone else.
And BTW - I care little of your opinion so buy what you want and I will do the same.
Once again your rambling nonsense; my point is simple, you got it horribly wrong in the past and you don't seem to be able to accept that fact. I've disagreed with you in the past and your response has been to attack me personally, perhaps you're jealous that I can pick cycles and you are unable to. I'm adding clarity to the debate; pointing out the people in the past who've cried "bubble, bubble" and got it horribly wrong, you're one of them.
So we have you picking gains and other saying bubble which is also a gain btw. The only thing is you are claiming that because you decided there was going to be a rise it was not a bubble, that frankly makes no sense. So if we go back to the normal methods of P/E any time in the past it has been above 3.5 to 1 it is a bubble and has corrected. Which brings me to your second point, like my kids when I point out jumping off the roof might hurt they reply no it hasnt happened yet so it wont" frankly then I assume you have no insurance at all as it must be a total waste.
3rd, "jealous" LOL, you conceited so and so.
Speaking of people who get it wrong. I've been trying to explain to you for years why your P/E models are antiquated and why they persistently don't reflect the market. How can you say it's the market that's wrong and your models are right, it's the model that measures the market not the other way around. BTW you've been predicting a spectacular crash, not a bubble, but cute use of words.
So your opinion is it does not. You cannot substantiate that your opinion that flies in the face of past examples that says 3.5 to 1 or so is today not valid but now 8 to 1 is.
So lets far arguemnt get you to state what is teh P/E that you consider "normal"
8 to 1?
9 to 1?
12 to 1?
15 to 1?
Yet for Sydney / OZ at around 9 to 1 lots of other ppl are concerned that above 9 to 1 is a serious bubble and risk of popping.
I predict and still do a crash because its a bubble, ie ppls wages and energy cannot sustain ever increasing (and even current prices once oil output drops)
So if Auckland is 8 to 1 and 9+ to 1 is considered risky then there isnt much growth left in this bubble.
If we are to measure long term affordability and hence whether or not we are in a bubble; you do not solely look at PE ratios. They are but one part of my model; some people start with nothing (i.E. $0) so PE ratios are important to that group but not as important as interest rates which I forecast to be lower for longer. When considering all buyers and hence the way the whole market will behave you need to consider individuals accumulated wealth and therefore a new starting point other than $0. This reduces the weighting of PE ratios, for certain sub-sets of the population. Then you need to consider capital flows both foreign and domestic; these are much harder to measure but there is some information out there that gives a general idea. You also need to include population increase in a fixed land area; people per sqm sits on the demand side of the model.
I will concede that sustainability issues sit outside my models; whether we can transition smoothly (or not) will be seen. As will the time frame.
I invest in housing because it's almost a sure bet, that's not to say I think it's a good way to run our economy. My preference to slow house price inflation is to halt population growth, which is turn solves a lot of sustainability issues. I used to say as much often but I've come to realise, no one is listening. If I say "the market is going up" I'm a vested interest, if I say "halt population growth" I'm anti-business or anti-immigration and therefore racist.
When have I ever said a correction will never happen... Of course a correction will happen, my models show me a very good estimate of when. The same models that correctly picked the upswing we're in now; if main stream economists adapted their models to include new assumptions like accumulated wealth they might start getting it right too. Unfortunately people are too pre-occupied crying "vested interest" at anyone who says the market is going to go up.
So if you agree a correction will occur then why are you pointlessly arguing?
I mean seriously, are you on crack? And you don't sound very happy either Happy.
All I am saying is a correction usually follows a boom so for those property investors which do gloat (and I'm not saying all property investors gloat - some are quite sensible and humble) maybe it would be wise to be a little more humble, especially if you are holding a lot of debt.
Tut tut... so much anger Triple, It's very, very important to add to the debate that people like you have been saying Auckland's market is in bubble territory for years now and getting it wrong for years now.
What are you on that prevents you simply saying "I got it wrong" "I took average prices over only a few months of the year I tried to tell everyone the market is crashing, then faded away when the market took off again". Seriously? How dumb do you think people are...
I used to think you were just your standard try-hard-wanna-be-investor who typically is worth bugger all. But now I can see you're actually a bit disturbed. Perhaps you should spend some of your "capital gains" on counselling. Maybe then someday you will end up happy.
So you do see a correction, just you do not see it short term (or wont say, whatever). Actually then I fail to see just why you are arguing about it. The only Q is when and how big which has certainly been my and I think triple's position all along. In terms of your model in effect you are saying that you have an effective model for external events as well as internal to NZ events and you can predict it accurately. Of course that has to be with a tolerance and then leave you enough time to exit your position, in effect you have to be seeing something like 6months out with complete confidence. I simply fail to believe you frankly, Plus it doesnt do the rest of the home owners or tax payers the least bit of good, does it. In fact it is to your advantage to pork the market as much as possible in order to make yourself the most money before you exit.
Oh and btw if its a big correction just where do you think you can hide your what must be quite a few millions? Short term bond / cash like instruments? yeah right. Offshore? yeah right. Frankly you are and indeed most ppl are looking like you are up doo doo creek without a paddle...no where to hide.
better title is Auckland property speculators - no investors left now as with increased insurances , rents, tradesman costs for maintenance and rents largely static almost al these properties bought in last couple of years are negative yields - so just chasing capital gains not yields - speculation not investing.
and yes it will continue for a bit - who knows how long - but all bubbles burst and all markets correct or collapse - huge number of people who have bought or invested since 2008 who have never paid rates over 5.5% and even at 8% will face massive shortfalls on mortgages over 6 and 700,000! These are big numbers involved now so even a 2% rise will mean huge increases - especially for investors who are already having to top up payments at 5% !
It's political - and everyone knows it
The rear-view-mirror - looking backwards - nothing has changed
John Roughan 9 May 2015 NZherald
Five years ago, when it was still fresh, Govt was looking for a way to discourage property investment. A tax working group studied options, including a capital gains tax, and the Budget that year removed tax allowances for depreciation. The Government decided the problem was simply a housing shortage which it could blame on unpopular Auckland Council planning. That was good politics but economic nonsense, and Bill English knows it. Actually, everybody knows it. Auckland property is simply the easiest and best investment known to most of us
http://www.nzherald.co.nz/opinion/news/article.cfm?c_id=466&objectid=11…
What was Bernard Hickey writing about 5 years ago
Bernard Hickey 18 Sep 2009 in NZherald
John Key has made a poor start by promising not to extend the retirement age, cut the pension or impose a capital gains tax. Who is he governing for? The blue rinse set at National Party functions or New Zealand's future generations?
http://www.nzherald.co.nz/bernard-hickey/news/article.cfm?a_id=625&obje…
Here are the Bernard Hickey Herald archives going back 5 years - worth a trawl
http://www.nzherald.co.nz/bernard-hickey/news/archive.cfm?a_id=625
That's the problem with X-Factor Prime Ministers (thrust to the front of the stage with minimal talent, no experience, telegenic personality and a bit of a back story).
They wake one day having to face the awful truth. They are PM not just to the good folks at the Matakana Farmers Market. They are also PM to the poor, to all the people who voted for all the other parties and especially to all the people who just see the world differently.
I accept that JK thinks he can be PM intermittently when he feels like it but that's not the job description.
the longer he is there the more further removed he becomes from the ordinary bloke, it happens to all PM,s they get surrounded by civil servants and agenda seekers and in the end cant tell the difference between the truth and BS.
cause in point pony tail he thought he was being funny, those around him didn't want to tell him he was being a dhead.
same thing happened to clark at the end she let things happen around her she wouldn't have at the beginning
Would you consider BH and his ilk to be part of the problem? A few years back he infamously predicted a 30% drop in Auckland's house prices so any MP reading his work would have thought, why bother changing the law to control rising house prices if prices are going to fall. On the contrary they probably thought they need more investment in property if prices were set to fall that far.
things ive noticed.
-auck house prices rose faster and further under the previous Clarke govt but many on here like to blame John Key for everything.(the moderators here also take a soft hand to many of the comments made about him)
-not that long ago many here (Hickey included ) were lamenting the fact that our"best and brightest " were heading overseas.Now they are coming home looking for somewhere to live this is somehow a bad thing?
-I think the current rises in house prices are short term as when many of the "new arrivals" work out that auk super city will be crippled with huge debt servicing/rate increases from your dopy lefty mayor and his crazy projects..they will bail out ,possibly to somewhere else in nz or aussie.Then there will be plenty of cheap houses for you all to live in and pay off redundant infrastructure for the rest of your days
You assume there is somewhere else to go, there isnt IMHO.
"doppy left mayor" so pray tell how would a right wing mayor fix Auckland's problems? Seems privately owned roads and tolls are out yet that is "classic user pays"....etc etc. Do nothing let Auckland seize up and have failures in its infrastructure? bound to end well.
I think people are blaming govt policies for laying the groundwork for what is happening, it started way before clark government and has been carried on govt after govt.
it comes back to the ultimate question who is it up to for people to be housed in affordable healthy houses.
do the government take the lead and responsibility or is it up to the individual. once you decide on that then is it up to the government to build and provide funding or is it up to the government to incentivise private enterprise to do
which ever options you take will effect other government spend on health, education, law, welfare
The roots of the problem go back to 1947 and the idea we imported from Britain that a handful of cardy-wearers locked away in a dark room at the Council Buildings could do a better job of designing towns than the people who are stumping up their own money to build, live and work somewhere.
As a country we masked the flaws of that system for decades through the state housing program. Successive governments bypassed the cardy-wearers, bought land at "farm" prices, integrated the development of that land with infrastructure provision - especially transport - as well as building the houses. The result was that even in periods of high net migration (and we have certainly had those before) house prices didn't get out of control.
We actually abolished the 1947 lunacy in 1991 with bi-partisan support for the RMA. The actual RMA, as written, is permissive with an implied Right to Build. What we can blame successive governments for since that time is not going back to councils and forcing them to implement the original legislation.
So yes, today, the ball is squarely in the government's court.
This is assuming that the current state of the housing market is interpreted as some kind of accident. I've been reading about the economics of property for some time now. The writings of the British architect and town planner are particularly relevant to the subject in question.
The people who were responsible for the Town and Country Planning Act's enactment were the Campaign for Rural England, a body which represented the interests of the British aristocracy and country gentry, who continue to own the majority of land in Great Britain. I would include the National Trust, another body which reflects the prerogatives, which are to contain the growth of urban areas within the current boundaries. This has two outcomes, it increases the market value of property within the growth boundaries, because it witholds supply from the market while demand rises with population growth and it has the convenient side effect of preventing the intrusion of the hoi polloi into the domain of NIMBYs within the aristocracy and gentry.
I think you are right Anarkist about UK. Churchill could have reformed away the Town and Country Act in 1951 when the Tories were in government. Initially the Act was very unsuccessful because it basically stopped all private development. Instead Churchill's reforms allowed private development but at the expense of strengthening the hand of land owners to extract monopolistic prices.
The way I see it. Repelling the Corn Laws in the 1840s was a major boost to city/town based industrialists (and workers) by removing the traditional economic monopoly rights of the landed gentry.
The Town and Country Act and Churchill's reforms can be seen as a re-balancing in favour of the landed gentry again.
"The way I see it. Repelling the Corn Laws in the 1840s was a major boost to city/town based industrialists (and workers) by removing the traditional economic monopoly rights of the landed gentry."
Well yes the repeal of the Corn Laws it help the capitalists and workers whose interests coincided on this issue, though later the workers found the solidarity of the capitalists rather fleeting. The industrialist came to terms with the aristocracy, because the nobility had amassed a huge pool of wealth wealth over the centuries, which the industrialists needed to tap into for capital investments. Capital investment provided a much needed opportunity to diversify their economic base away from farming which couldn't compete with cheap imports from the United States and Russia.
The aristocracy in England was also more prone to engage in industrial ventures and these joint “business interests promoted a degree of intercourse between people of different stations and walks of life that had no parallel on the Continent”2
https://medium.com/@whatpeebsays/the-investment-vs-commercial-banking-m…
One could also describe the European Common Agricultural Policy as a modern day incarnation of the Corn Laws, and ironically the aristocrats still receive the bulk of CAP subsidies.
"Of all perverse public spending in the rich nations, farm subsidies must be among the most regressive. In the EU you are paid according to the size of your lands: the greater the area, the more you get. Except in Spain, nowhere is the subsidy system more unjust than in the UK. According to Kevin Cahill, author of Who Owns Britain, 69% of the land here is owned by 0.6% of the population. It is this group that takes the major payouts."
http://www.theguardian.com/commentisfree/2011/nov/28/utilities-aristocr…
What was done in NZ fixed but it was dismantled by the State and corporate greed.
milk farmers needed to have modest prices for their product,
like the UK farmers they worked the land, not run the companies (and you always end up needing someone to run the labour factor, not everyone can be a manger or speculator)
the low income for the milk farmers meant that buying property and developing the raw materials end was consuming most of their meager income
So the milk farmers and the State set up a network of _Co-op_s. This meant that the Coop could trade in domestic OR foreign product, and even the price out. ALL milk suppliers of the co-op got the same price, all the prices to the consumers were the same, independent of the source (local, foreign, farmer A or farmer B).... no "GMP!!" . Foreign product could be distributed locally, and local farmers would profit. Local product wouldn't get pushed out of the because the founding principle of the _coop_ was to support local business and local farmers, and gave them guaranteed profitable market.
It was very successful.
- -
Now I do want to you to ask yourself, just _how_ is it that "the foreigners" could constantly make cheaper product? so cheap that processed AND delivered to foreign soils was still under cutting local suppliers. (hint: go have a look at what they were paying their tenant farmers....)
Yep definitely Anarkist in Europe the CAP was part of that re-balancing of institutions back in favour of land owners. Britain is the worst because of the cultural practice that the eldest inherit the estate they have the most concentrated land holdings.
The English seem to be culturally conditioned to accept inequality and could not tolerate a system that would gradually de-power their 'betters' in the upper classes.
The lunacy in the EU is without bound. On my last visit to Britain I kept hearing about farmers making a good living by "setting aside" good farmland and receiving EU compensation. So beautiful rich dark loam was sprayed with a liberal dose of Roundup and the owner made more money than if he grew a crop. Something terribly wrong with this, the farmers were embarassed as it goes against the unwritten code of the farming world that good soil should be cherished and put to good use.
Anarchist, I find the old capitalist v worker stuff makes no sense to me until you make it capitalist and worker v banking and government. Producers and consumers are generally mutually supporting, but banking and government can be productive or parasitic without much feedback.
It's not such a silly idea once you start working through the maths.
There's a market (lets say) for 50,000 million litres.
each there's 100,000 farms (for the maths). therefore the average farm is 500,000 liters. Some will make more, some will make less.
BUT. what if the market is really only for 35 billion liters? A good farm will still make more than 500,000 liters. and the poor ones won't be doing too badly either.
The "NZ way" was to take as much production as possible and turn it into butter they couldn't sell (butter is cheap and lasts a long time) and make a lake out of the leftover buttermilk and get fined.
The farmers get underpaid, but their production costs are still arranged to maximise production because they only get paid for volume (kgMS).
In the "setting aside" system, the processors and government recognise there is over supply.
So they say that you get paid for your 500,000 liters... but you only have to make 350,000 of it (but you do need to have proof of _capacity_ for the 500,000).
So that way you get paid for 500,000 but your costs are only for 350,000. And the government gives them a subsidy to turn the land into something positive (as opposed to NZ when they fine the desperate farmer instead, who is still trying to crank out maximum production level at top efficiency just to stay liquid).
the processing company still sells the same 35 billion litres worth, the processing company still makes the same revenue, has less fines and handling costs, and pays "as if" production was at capacity, because the extra between there and capacity would not have gained any additional revenue.
Sadly there is actually little "better use" to put the land to. They could farm flowers etc, but they still need to prove "capacity" to get full payment. And the conversion would likely depress other markets instead, so much care must be taken with conversion.
It's one of the reasons I'm getting out. Those quota and "setting aside" systems the gloves are going to come off, and just like it did with kiwifruit and goats, production is going to ramp up to maximum 500,000+ and collapse the market. Such is the wonder of supply side economics, when the suppliers don't understand the market forces.
There is a huge difference between a capitalist and an industralist.
poor people are no use whatsoever to a capitalist - capitalists want rich people (Fordism) who can buy product, the more the merrier, and that puts cash return in the capitalists pocket so they can also consume/purchase from others. Poor are the bane of such a system (hence the dislike of socialism, as it is orientated to making everyone equally poor, and enslaving some to serve others).
The industrialist/bankers however are much different, they like the socialist, thrive on a debt system.
In capitalism you earn and consume.
In industralism, you serve for your scraps and are just a small easily replaced cog in a big machine, the bosses allocate you your allotted allowance, but there is nowhere else to go because of your debt, you are owned.
In the bank system, you owe the banks and government, so much begging goes for a chance at slavery.
In the socialist system, it mirrors the industrialists because you can't own anything, so you can't save, or develop - if you develop more skills, you get more forced labour, while your adminstrator pockets your proceeds. Do better? they'll just distribute it more widely. Just like the industralist, do well, work hard, your boss gets wealthy.
In a capitalist base, your output is your property. you are your property. A capitalist government is given the task to see that its citizens property increases in value _for_all_capitalists_ (ie all citizens, not just bureaucrats, industrry or bank owners). And you can take _your_ property and band together with others, to build bigger things...without risk that your neighbour or owner will come a claim ownership.
It is called "policy settings" or in a different context, setting the rules
Should circumstances change and policy settings no longer appropriate, change the settings
Like in most international sports there is an international committee that sets the rules on how the game is played, then you have referees that administer and apply and enforce those rules, then you have players who pay membership fees and join clubs and agree to play by those rules
In Rugby League players know they cannot and should not use spear-tackles or throw-tackles and are not allowed to play the man without the ball. If they do they get sin-binned and rubbed out for a number of games
Don M,
The affordability of housing didn't become a widely recognized issue until 2007 and yet the Prime Minister continues to deny that there is an affordability problem in Auckland. Is it any wonder that nothing is being done to solve the problem when the PM denies that there is even one at all.
Speaking on Firstline this morning, Ms O'Sullivan said investors don't drive up prices because they are "rational" about how much they're prepared to pay, unlike people buying a home to live in.
Read more: http://www.3news.co.nz/politics/desperation-pushing-up-prices-not-inves…
btw, the REINZ thinks that a housing crisis won't be evident until people start camping in tents in the Domain.
""A housing crisis would suggest we had people camping in tents in the Domain. We are thankfully not at this stage, but I do think there is significant pent-up demand for housing in Auckland."
Read more: http://www.3news.co.nz/politics/desperation-pushing-up-prices-not-inves…"
http://www.3news.co.nz/politics/desperation-pushing-up-prices-not-inves…
Speaking on Firstline this morning, Ms O'Sullivan said investors don't drive up prices because they are "rational" about how much they're prepared to pay, unlike people buying a home to live in.
""If the maths doesn't stack up, then they'll stop… where perhaps people who have fallen in love with a property, or who become what we call 'the nutter in the room' because they've been outbid for so many properties, they will go a long way to secure a property," says Ms O'Sullivan.
Read more: http://www.3news.co.nz/politics/desperation-pushing-up-prices-not-inves…"
If this poor excuse for logic is representative of the industry it is no wonder the housing market in Auckland is in such dire straights. First home buyers bidding behaviour reflect rational calculation, because they have to take into account the future not just present affordability of housing. They have to consider future price rises to establish whether its better to buy now or later.
Property investors are concerned primarily with capital gains, not yield which explains why rents are lagging house values. They can arrange interest only credit from the banks, rent it out for awhile, and make a tidy return upon sale.
"The affordability of housing didn't become a widely recognized issue until 2007"
Nonsense. Property prices more than doubled under the last Labour government, from a already high level. In response Labour created no new housing areas, instituted no new property taxes, no immigration controls, essentially no effort at all to stop the rise.
Views on which party is responsible for the current cost of houses usually revolves around which side of the political spectrum you sit on.
Re : REINZ and tents in the Domain. The crowds of homeless that hang out i.e. live there don't have tents,
since that would reveal their hidden home. While on the subject, could it not be top priority for NZ camping grounds to be retained as 'National Treasures'? A whole NZ 'way of leisure' is at stake with their sale to developers.
Kumbel, I think you're overstating the degree of self-reflection that the PM is capable of. Take the Pony Tail Gate scandal as an example. Even while he fronted up to the media and made a statement, it fell far short of a true apology. A real apology implies an admission of wrong doing, which conveys an expression of remorse and regret for one's actions. None of which were conveyed by his media statement. Instead what we got was was his usual dissembling, self justifying explanation for his aberrant behaviour . What's worse is the public's reaction.
I was listening to talk back radio afterwards and was appalled at the number of WOMEN who called up to express their displeasure at the media's bullying of the Prime Minster. Many who claimed to have worked in the industry recalled having experienced similar behaviour and criticized the complainant for making a big deal over what was in their view, "crying over spilt milk". I'm disgusted that women were willing to downplay what is essentially workplace bullying and even sexual harrassment for the sake of political expediency. But this provides a sobering insight into the current deplorable social and political state our country is in.
I actually think Labour are the Party better suited to governance, because they showed themselves more willing to constructively engage stakeholders outside their own narrow political milieu, while National devotes themselves to slavishly following the political template constructed by the neoliberal ideologues in Treasury, the New Zealand Initiative, and BusinessNZ.
http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=10546860
An old girlfriend of mine dotes over over the JonKey. He could do no wrong. He dressed really tidily, had lots of money, and had influence in government. No doubt his face was symmetrical too. How dare we question the great one.
As for self-reflection? I think he does a lot of it...
Every time he sees his reflection in a window, or his picture in the media, re reflects "why haven't they made me king yet?" , "Wow are I just wonderful?"
I mean, seriously. read the guys body language. It's really fked up. The closest I've ever seen to it is a stuck up school teacher in primary school waiting for a few of the children to finish getting changed. Very much, I'm wanting for this to be done so I can get back to my cuppa; why don't you hurry up the decisions are already been made elsewhere months ago, can we just get this over with. I know I've got to be seen here, to keep everyone in line, but seriously I've got important stuff I'd rather be doing.
jonkey to a tee
Hotchkiss' seven deadly sins of narcissism[edit]
Hotchkiss identified what she called the seven deadly sins of narcissism:[9]
1.Shamelessness: Shame is the feeling that lurks beneath all unhealthy narcissism, and the inability to process shame in healthy ways.
2.Magical thinking: Narcissists see themselves as perfect, using distortion and illusion known as magical thinking. They also use projection to dump shame onto others.
3.Arrogance: A narcissist who is feeling deflated may reinflate by diminishing, debasing, or degrading somebody else.
4.Envy: A narcissist may secure a sense of superiority in the face of another person's ability by using contempt to minimize the other person.
5.Entitlement: Narcissists hold unreasonable expectations of particularly favorable treatment and automatic compliance because they consider themselves special. Failure to comply is considered an attack on their superiority, and the perpetrator is considered an "awkward" or "difficult" person. Defiance of their will is a narcissistic injury that can trigger narcissistic rage.
6.Exploitation: Can take many forms but always involves the exploitation of others without regard for their feelings or interests. Often the other is in a subservient position where resistance would be difficult or even impossible. Sometimes the subservience is not so much real as assumed.
7.Bad boundaries: Narcissists do not recognize that they have boundaries and that others are separate and are not extensions of themselves. Others either exist to meet their needs or may as well not exist at all. Those who provide narcissistic supply to the narcissist are treated as if they are part of the narcissist and are expected to live up to those expectations. In the mind of a narcissist, there is no boundary between self and other
5) Often doesn't show as "an attack" because that would be personal, and perfect people don't get attacked nor harbour resentment. The offender is *faulty* and "wrongful" for breaking the social contract/order.
Narcissists often don't see the difference between themselves and the system. this is why the rules don't apply to them because they are the rules, they are God and the universe. You can't "attack God" you can only be a "nuisance heretic seeking to damage others" and must be punished for the public good. Nothing personal about it, it's for the betterment of society.
7) as touched on about. It's not that others are separate or an extension of themselves, because that would be egotism, which is bad. Its that they are all just there so, pragmatically, you just fill in your time. As long as you are following all instructions and not countering any instruction then the system is working. there are no boundaries on directions. Things like "please don't touch my hair" don't make sense to the Narcissist brain, because the hair was already touched so it is permitted by the system - in fact there is _more_ likely to be a repeat, as the narcissist tests the curiousity of what happens if the hair is touched. Likewise "I don't like that" is just a persons' statement of their feelings, the system requires communication between two people, having the other person make a definitive statement about themselves is a challenge to the system and if one doesn't want to be bottom dog, one must ponytail up to the challenge. Sadly enough physical violence is often the most effective communication with the narcissist, as it deals directly to the buried self-interest and by passes any reasoning/justification processes.
Again, the type of reaction to Ponytailgate depended on which side of the political spectrum you sit on. Most normal rational people would say it's harmless but a PM should know better. Those on the far left just saw a chance to score points against their arch enemy and, to their own detriment, completely overreacted. It made them seem angry, spiteful and disconnected. It's the same angry spitefulness that was on display at the last election which led to Labour losing so badly.
Ponytailgate again showed us just how vicious, nasty and disconnected the left has become.
Agree that the reaction of people depended a bit on what side of the political spectrum they're at, but I would call the people who thought it was harmless, 'normal and rational'.
.
As an adult, it is not harmless or normal, to touch another person without being invited to do so. It's even worse when the person doing the uninvited touching is a man, and occupies the highest and mos powerful position in the country, and the person he touched, is a young girl.
.
If you can't see that this was highly inappropriate behaviour, then, frankly, you are part of the problem. Women's bodies (this includes hair) are not toys for men, to touch as they please.
.
What poneytailgate showed me, is that a lot of men in the world still think they can do to women as they please, and don't even see anything wrong with it.
This is because in 2007, incomes were broadly rising with the introduction of WFF and a tight labour market. A state of affairs the banksters were not happy about at all. Now incomes are only rising in Auckland and Christchurch which allow people to accommodate increased cost of housing.
"The Bank of New Zealand's head of research, Stephen Toplis, said the tightness of the labour market was the single biggest problem facing the economy. Job security left people feeling "bullet-proof" and comfortable spending up large both on housing and through the retail sector and becoming less resistant to price rises, he said."
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=104…
... if the governor of the Reverse Bank had some seriously big kahunas , he'd raise the OCR 200 basis points or more , and deliberately crash the economy before the housing market got even more spaced out from reality than it currently is ...
I think that'd grab Jolly Kid's attention more than some waitresses pony-tails ...
... the alternative is to continue whittering on about " irrational exhuburance " , but doing nothing concrete to stop it ...
The entire economy of this great little land ( girt-by-sea ) is being hamstrung by the Auckland property market ...
Would a 200 bp hike really have much effect on Auckland?
It would give a great advantage to buyers with access to offshore funds/high net worth immigrants and foreign buyers.
Mortgage interest rates really will not discourage any buyer who is looking at 100k or 200k capital annual increases.
It would close out local money much more effectively.
Existing off shore leveraged funds would be cracking open the champagne. (interest must be paid for by someone, so either the rent goes up, or the cost of the property must go up to cover the interest. that pushes prices up) unless it's so bad the local market demand is destroyed, which with a high local interest rate - is party time for the offshore vulture money, swooping in for the hot deals super cheap. You want a fire sale in Auckland that will do the job - shame no-one local could benefit.
BTW, anyone know what's happening in Napier's local economy. If money is tight, wine will be poor, I hear the tourist trade has all but collapsed there. They were hoping for a brief respite while the damn builders injected some capital and spending into the area. So what are they running on these days (if not tourism)?
Napier employment: Pan Pac mill, Napier Port, HB Health (Hastings), Napier Council, Hastings council, EIT, retail struggling, tourism flat, Packhouses, corporate orchards ok, vineyards - too many, Schools employment. Generally holding water. Housing market flat. Govt underfunding Hospital & Polytechnic. Napier council doing quite a good job rolling out new sections/housing. Traffic jams low! Lol.
Gisborne a lot worse - official & unofficial unemployment high.
Will Hawkes Bay become another Wanganui/Waipukurau/Wairoa?
we have so many small regional towns that can handle more people and whos councils would welcome the growth with open arms, but how do you get business to go there. Fontera one of our biggest primary companies now has its head office in Auckland why? no where near its plants or shareholders and exports
imagine if they took those jobs to a smaller centre, what a boast that would be to the local economy.
the industry I am in has done the same down sized all the region offices and moved the functions to Auckland. we now fly sales reps down every third week to service clients
Because Fonterra is a baronry. And ripping it's suppliers off:
Price to _make_ 1 bale of balage: $50
1 balage of perfect balage = 150 kilograms of DryMatter of feed.
Fed to a Fonterra supplying cow, 12 kgDM (kilograms of Dry Matter) is required to make 1 kilogram of milksolids (kgMS). feed the cow 19-21 kgDM is required to get 2 kgMS. There is diminishing return as it is easy to make a hungry animal eat, but hard to make a fully fed animal eat more/to maximum. This comes through as efficiency: to get 20kgDM input, you need 100% _perfect_ feed, and how much of the input to any system is 100% quality.
The maximum a cow can eat of balage is 4kgDM a day while supplying milk. beyond that it's like having to only eat weetbix, even if you know it's your main food, there's only so much you can face eating.
there is 150 kgDM in each bale of $50 balage.
150/12 = 12.5 kgMS produced
12.5 * $4.50 = $56.25
$6 margin on the perfect bale of the most economic feed, without storage or capitalisation (ie machinery for storage or distribution), time, fuel, no extra trucking, no process wastage. That $50 is the contractors bill (cut, dry, bale, wrap, stack, farmer must provide labour and tractor to assist) and does not include price of the raw material.
The retail price for such a bail is $80 - $130.
TAF Fonterra is not owned by supplier farmers. It's only a matter of time before it follows the likes of Glaxo to be where it's market really is (either China or by the gDT area )
housing in and of itself isn't an economic driver.
lots of council infrastructure spending there, which is not good (it comes from "inside the club" (ie lousy fundraising).
NZ retail isn't generally differentiated by product/service so is very low value.
Schools is good, draws back some of that tax money, but, underfunding of hospital and polytechnic probably remove the effectiveness of the schools to support local brains trust, and counter balance the money coming in through schools.
So orchards, orchard support and EIT.
Any commercial or industry hot points?
Call me cynical, but RE agent scam to screw a few thou extra out of desperate FHBs?
http://www.stuff.co.nz/life-style/home-property/68324088/good-samaritan…
Henny Pulse, Deputy Squawker for the Associated Cluckfusters Collective, is all a’flutter about the proposed Special Henhouse Areas.
Your humble scribe interviewed her on the background. Henny, resplendent in polished wattles and her customary bright pink legband, came out firing.
‘Why’, she warbled, ‘there just hasn’t been enough thought given to the infrastructure needs of new Henhouses. Nesting materials, for example. Without a prior delivery of this material, no SHA can possibly be started. So, it’s simply the Responsible thing to do, to demand a commitment from those pushing the SHA’s, to stump up with nesting and other materials. So, along with my fellow Cluckfusters, we just won’t permit any new henhouses until this happens.’
Assuming the royal ‘we’, we then asked Henny what about the issue of Homeless Fowls, and the recent wave of immigrants from Other Farms, attracted by our local culture, the prospect of free-range dwelling, and the not incidental prospect of massive Nest-price Gains (non-taxable).
‘Oh, them’, she waved an arm dismissively. ‘Well, we already have a HenHousing Unitary Plan for that lot. It’s taken years and years to get this to the starting point, we have a whole team devoted to it, the grey-leg-banded ones. We call them the ClusterFlock.
The Plan envisages that we just stack a whole bunch of little cages up into the sky and invite these new flocks to take up residence. No need for new HenHouse Areas at all. Why, on a Good day, they can, with some effort, turn around in their tiny piece of real estate, and see the Sea!’.
At this point, a very Flustered PR Flackbird flew in, alighted on Penny’s back, took a mouthful of wattle and a right old henfight ensued.. The upshot of which was that ‘cages’, hutches’, ‘battery fowl’ and any mention of square centimeters per fowl were deemed ‘prohibited speech’ and were to be stricken from the record. The replacement phrase was, evidently, to be ‘sustainable sky-home’.
Armed with this sitrep, your scribe then turned to the Head Farm Rooster – a rare bird, sporting matching Blue and Green legbands, and asked for his reaction.
‘Henny, I regret to say, he intoned, ‘is on a hiding to nothing. Not only do the CluckFusters lay enough eggs to buy all the nesting material they need, but they actively sustain a nest-banking industry by dribbling out new-nest permits at a frankly appallingly low rate. This keeps the nest pricing structure way out of whack with eggs-per-day income possibilities. So, it’s up to them.
And, anyway, as Farm Management, we can overrule this shed any old time we feel like it. But which, to be perfectly honest, we don’t want to do. There may indeed have to be a few Omelettes, to teach this sorry flock their place in the pecking order. But you’re not ever gonna see any Blue-legband clawmarks on any of those broken eggs…..’
'We prefer to let Nature to take it's course. Red in tooth and claw, isn't that the way?'
:)
That's the time for me to worry you reckon Gummy? Na, I will just hang on while the markets slump (the opposite of Bernard's prediction), buy some more, then enjoy the recovery on the other side.
( PS: All the best there Gummy ... nice to see you still in fine form on the keyboard)
... good to see you in fine form , too , YL ... I was away for awhile , money was short , so I had to " burn a crust " as they say ...
I was training to be a chef ... but they suggested I move on , after the pots and pans began screaming everytime I entered the kitchen ...
... yes , best to take Bernard's predictions with a little more than just a mere grain of salt .... a whole Siberian mine full of the stuff instead ...
Property prices always double every 10 years (more or less).
This has been the trend for the last 50 years and will always be the trend.
There are times when they do nothing and there are times when they increase at 20% per year but on the whole, they double every decade.
So get over yourselves about a crash - there might be a minor correction but not a crash!
Maybe property prices doubled every ten years in nominal terms. But I doubt in real terms (i.e. adjusted for inflation).
Certainly it is an impossibility for housing costs to double in relationship to wages every ten years without the creation of a new class of mortgage slaves. A modern day version of serfdom......
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