Rising house prices are pushing the dream of home ownership further out of reach for aspiring first home buyers, in spite of recent cuts to mortgage interest rates.
According to Interest.co.nz's Home Loan Affordability Reports for November, rising prices at the bottom end of the market have more than made up for falls in mortgage interest rates since the Reserve Bank cut the Official Cash Rate (OCR) from 1.5% to 1.0% in August. This means potential first home buyers are now worse off than they were just before the OCR was cut.
The reports show that the Real Estate Institute of New Zealand's national lower quartile selling price (the price point at which 25% of sales are below and 75% are above, (traditionally the part of the market that is of most interest to first home buyers), has risen from $401,900 in July, before the OCR was cut, to $450,000 in November. That's a rise of $48,100, or 12%, in four months.
The rise in lower quartile prices has been nationwide, with all regions posting prices that were substantially higher in November than they were in July and record highs being set in in Northland, Auckland, Waikato, Bay of Plenty, Taranaki, Wellington, Canterbury and Otago.
That has more than offset the benefits of lower mortgage interest rates, with the average of the two year fixed mortgage rates offered by the major banks dropping from 3.81% to 3.48% between July and November.
That means the mortgage payments on a property purchased at the national lower quartile price would have increased from $351.31 a week in July to $385.81 in November, an extra $34.50 a week.
Not only are mortgage payments increasing in dollar terms, they also increasing as a percentage of typical first home buyers' incomes.
The Home Loan Affordability reports track the median after-tax pay of people aged 25 to 29. In July this year the mortgage payments on a home purchased at the national lower quartile selling price would have eaten up 21.8% of their take home pay.
By November that figure had risen to 23.23%, representing a significant decline in affordability.
And of course rising prices also increase the size of the deposit first home buyers need to scrape together to buy a home, which combined with higher mortgage payments push their goal of home ownership further out of reach.
This suggest that the benefits of the most recent cuts in mortgage interest rates would have fallen entirely to people who already owned properties, who would see their property values rising at the same time as their mortgage payments fall.
But they appear to have done hopeful first home buyers no favours at all.
The comment stream on this story is now closed.
Note: A technical issue has prevented the monthly updating of the published Home Loan Affordability reports for individual districts. These are expected to be updated and available on this site around the second half of January.
*This article was first published in our email for paying subscribers. See here for more details and how to subscribe.
106 Comments
Is Auckland still less than 40% take home pay and therefore considered "affordable"? Edit: Sorry, just seen the note about this not being available until Jan. I predict it will come in as "affordable" and the usual suspects will have a whinge.
Graeme Hart bought his first house for $25,000 which was affordable and no wonder he is so rich now, I'm going on a buying strike until houses drop back to $25,000 so I can be rich too.
Good luck to you.
..and a Rolls will cost 10k and a great meal out just $1..
Wrong! Graeme Hart got rich because he bought The Government Printing Office for a song when it was sold off as part of Roger Douglas's fire sale of State Assets. He built his future investments on this foundation. He actually started out as a tow truck driver!
I bought my first house in 1967 at the age of 19 for the princely sum of $11,500 just after NZ switched to decimal currency. I had laboriously saved up the $3,500 deposit by doing an "Auckland Star" paper round in the pound, shilling and pence days, and also by collecting the monthly accounts of customers on my own and other delivery boys' rounds on Saturday mornings. I did this for 5 years from the age of 13.
I must admit I had a grandmother who got me into saving by giving me 5 pounds for every 100 pounds I saved. (Any grandparents take note that this is a great way to encourage kids to save.) Some years later I virtually lost the lot when I was unwisely persuaded to put my funds into a property development in a property slump in 1979. It took time but I did manage to climb on the property ladder again and eventually flourish.
Young people today are sucked in to wasting their money on useless tech gizmos instead of saving, and don't seem to want to have to take on a few hours of work per week during their high-school years.
Avoiding paying for tech gizmos won't get us a house deposit. That's like the avocado argument. Also, tech gizmos are often necessary for education, communication and career advancement, certainly not useless. I worked through high school too, a lot of my friends did. No way would you be able to save for a house deposit after 5 years of paper rounds these days! Have you not seen the graph showing the increase in house prices outstripping wage growth, we are living in different times now.
https://www.top.org.nz/key_indicators_of_new_zealand_s_inequality_erupt…
Hi streetwise,
That’s an excellent post!
It contains several good lessons in a real life context.
TTP
Have a whinge! Do you not care about the opportunities of mine and future generations?
Inequality is a huge issue, and house prices are exacerbating that. We have become a class society, and it is not good for anyone.
https://www.ted.com/talks/richard_wilkinson_how_economic_inequality_har…
Rising house prices are pushing the dream of home ownership further out of reach for aspiring first home buyers,.....
Mission Accomplished. Congrats !
It's OK, 2020 is going to be a good year for the real estate industry.
. . sadly , yes . .. awesome for agents .... awful for FBH's .... again ... for about the 20'th consecutive year ....
Houses are not meant to be a gold rush for the real estate industry & rich listers ...
... they're an essential for regular folks , families , workers ....
Then how come all of NZ's richlisters got rich off real estate? Jacinda needs to pass a law that nobody can own more than 1 house.
It can't be true that only property produces richlisters... after all the nz sharemarket rose 30 percnt year to date. Yet there is no outcry, imagine the noise if house prices did the same.
If the share holders sell their share will end up paying 40% tax but housing speculators............
Policies by vested and corrupt politicians.Infact national is not as dirty as far as CGT is concerned for never promised CGT (Open about their vested interest) but JA is, as she was voted for change and once in power backtracked. Come election and throw them out and vote for TOP. If USA can vote for trump...
You only pay tax on the sale of shares if you are a share trader, same as a trader in houses will need to pay tax on the sale of a house (and even if not a trader will pay tax o n a residential house sold within 5 years of purchase if not the main home.
Many people have made massive tax free gains by selling shares and businesses (e.g. Sam Morgan).
Compliance among property speculators who buy with the intent of capital gains is said to be pretty darn low. Even commenters on here were seen to say "be careful about saying openly that you're buying for capital gains"... Seems like a lot of tax evasion going on.
It was Winston's voter base that was against CGT and as she came in with him she has to take the good with the bad.
alittle(between the ears),
Where did you 'learn' that selling shares produces a tax of 40%? That is just wrong, even for those deemed to be traders. I, along with many others have been involved in the NZ stockmarket for many years and while I try to deal as seldom as possible, I still regularly buy and sell, with no CGT liability.
"policies by vested and corrupt politicians". An example perhaps? And by the way, a more appropriate English usage would have been, 'policies by corrupt politicians with vested interests'.
People don't live in shares, and corporate investments are more productive assets. No outcry because its better for society. Unlike unaffordable housing, creating a working poor middle class and increasing homelessness.
Exactly Gummy.
Thanks for your humour and goodwill again in 2019.
Using the figures for the national mortgage payment that gives a 9.8% increase in cost. Statistics from the Productivity Commission show productivity increases are between 1.5% to 2.5% depending on what sector you are in. Do people think this can carry on indefinitely?
Didn't we read in another article this morning that lenders are assessing 'affordability' at theoretical P&I rates of 6.69%? If so, the 'dream' of homeownership for FHBers is no further away today than it was yesterday or will be tomorrow. But the theoretical Affordability Calculations make for a good, reassuring read....(ie: If you couldn't 'afford' $401,900 at 6.69% then you still can't afford $450,000 at 6.69%, and for those who suggest that they could have bought 'then' but can't now, that's isn't a matter of affordability, it's a matter of choice)
All policies and decessions are taking to help and protect Average Kiwi FHB but in reality are all aimed to benefit Rich and elite of NZ (Not surprising as NZ is run by the same, so vested interest will prevent them like CGT as now even JA belongs to the same, so have more empathy for thier class of prople but potrays that no CGT is well for the average Kiwi :).
Only difference between Labou and national is that Labour to potray that working for poor throws some dole - have not heard the saying “Give a man a fish, and you feed him for a day. Teach a man to fish, and you feed him for a lifetime”
Give a PERSON a fish every day, feed XI for a lifetime. I can't believe this sexist, ablest nonsense in current year.
Richard1965, I would have like your comments if not for the many spelling mistakes (makes it hard for me to know if I understood your comments correctly...?)
Must protect the banks and indebted at all costs. Merry Xmas
In Awk more educated youth (13-20 years tax loss to date) will relocate to Aussie. I hope all the speculators like housing people from the wider Asia and Continent that are pouring in, as that is increasingly all that's left here - thanks COL. Also hope speculators like never seeing a NZ born and raised person in childcare, food service, IT, medical care, teaching, rest home care etc etc.
Election in 2020. NZF and LAB have been proven to have severe dementia with respect to immigration based election promises. Whats needed now is a tax change for asset holders. https://www.top.org.nz/housingmarketreform.
Taxing things makes those things cheaper does it? In that case, lets put a tax on cars and boats to make them cheaper too. Funnily enough, TOP has confirmed that their annual tax on all major assets will include fancy recreational boats, so cheap boats for everyone!
Taxing like CGT will help to curb speculation and all counyries in the world have CGT but NZ has been dominated by vested politicans, aho are enjoying the perk of Tax free money. If not than even share market should be expempt grom Tax as one pays tax on dividend just like rent so why double taxation as that was one of the argument for turninh down CGT thoigh actual reason was for housing ponzi to cobtinue. JA has to go and should do.
Any market introducing a tax on property when there is a shortage will just result in a higher price equilibrium to maintain returns. The real crime is both rejecting a CGT and cramming more and more people to create the shortages.
A land tax and a reduction in immigration would be an ideal combination to increase affordability over time. Agree on your point.
TOP's proposal isn't CGT, which is really just a form of income tax. TOP wants to tax all major assets annually, not the income earned by those assets or the capital gain cashed in when those assets are sold. They want to tax the asset, not the income.
and under TOP's plan rentals would be exempt :)
Really, I wish people would do a spell-check and re-read their posts before submission. Very hard to understand a comment that has typo error every line.
Serioiusly TOP party should give their best shot this election and may surprise themselves with posituve result.
Yes, the more votes wasted on TOP that otherwise would've gone to Labour and the Greens the better. No electorate seat and nowhere near the 5% threshold.
Not good news for Agents as rising prices means fewer buyers
That's wrong. Rising prices creates more demand, more sales, definitely.
HW
Also higher commissions.
I'm confused as nationally the volume of house sales are actually falling . It is also a primary reason why the RBNZ is cutting the OCR and will continue to do so in 2020.
Indeed. nZ sales 6000 lower in first 10m of 2019 cf 2018. Nothing to do wth rising prices. People buy more when things are dearer. Garbage
Cowpat
"It is also a primary reason why the RBNZ is cutting the OCR".
You are wrong.
The OCR is not primarily about housing; it is about managing economic stability. Lower interest rates are intended to manage the wider economy not specifically the housing market; it influences the exchange rate assisting exporters, provides lower to encourage investment (not residential) purposes.
If RBNZ wanted to stimulate the housing market it would cut the LVRs. LVRs are specifically intended to directly influence the house market.
Printer8, New Zealand has an economy based on the increased pricing of housing . The primary drivers of the economy, particularly over the past twenty years have been the very sectors that support the same, not exports..The RBNZ have themselves in a no exit corner, from which ,for all their modelling, they have no alternative but to lower the OCR . .
Plainly law of economics don’t apply in your world. Please explain why sales in Auckland are down 26% on 2016?
"Please explain why sales in Auckland are down 26% on 2016?"
Who are you asking mike?
Hi mike
In short, if you are asking me;
Sales are probably down, and prices are up in Auckland partly because listings and stock are exceptionally low (last realestate.co.nz media release). Also 2016 was an abnormal year at the end of a period of a hot market in which there were a lot of people speculating (buying and selling quickly seeking capital gains) and hence lots of activity.
Pretty basic.
Even more basic: prices up and sales down
Cuts in interest rates are designed to make existing debt cheaper to goose consumer. Not to help FHB who landlords need to keep renting
Mike
Another ridiculous comment.
The RBNZ cuts in the OCR has nothing to do with "goose consumers", nor is it about assisting FHB.
The RBNZ has responsibility in ensuring economic stability - that is their focus in action on the OCR. It impacts on a range of aspects; it affects our exchange rate (making imported goods for consumers more expensive), directly assisting our exporters, reducing interest rates for investment (other than housing), and assist businesses.
While you are at it, justify the following comment made yesterday "Real estate ownership is dominated by people over 65" by quoting the source of your information. You might want to check the following link which proves you so wrong yet again.
http://archive.stats.govt.nz/Census/2013-census/profile-and-summary-rep…
Love the sublime fake naivety here: whatever RBNZ says their reason for acting IS in fact the true reason. Ha
What are you rabbiting on about mike??????
Try Auckland and 2018 figs
“Ensuring” stability eh? Do u mean trying?
Neither government nor central banks can ensure anything. Adam Smith
Not obliged to “justify” anything to you.
If you and your ilk were in fact inclined to academic evidence rules then you would not last long in a public forum
Mike
If you make comments you need to be able to substantiate them. That is reasonable and can be expected in debate.
Your comment regarding housing being dominated by 65+ years old needs to be substantiated. It otherwise has the hallmark of a conspiracy theory and needs to be challenged. Teh reference I gave you clearly shows that you are not correct in your assertion.
So please provide support for your comment.
The RBNZ cuts in the OCR has nothing to do with "goose consumers"
When the cost of credit is lower, people tend to spend more. The OCR indirectly influences the cost of credit for individuals and households. This is particularly important in countries like NZ with high levels of private debt. Also, export-led economies such as Japan would appear to benefit from low interest rates. And that's true. However, the reality is that Japan's woes have been weighted towards internal domestic demand, not their ability to export. Japan has even increased GST to encourage people to spend today instead of holding out until tomorrow (deflation you see). It has had limited effect.
Furthermore, the wealth effect in Australia and NZ is very important. This is why the ruling elite are terrified of falling asset prices, particularly housing. This is particularly stark in Australia at the moment, despite rising house prices. They're pulling all kinds of tricks out of the bag to get people to spend again. Doesn't appear to be working as planned.
Evidence re age groups etc: more might come shortly:
https://population.org.nz/app/uploads/2019/07/3d-HomeOwnAge_Bentley2019…
More evidence on wealth and those over 65 for you
https://www.google.co.nz/amp/s/amp.tvnz.co.nz/news/story/JTJGY29udGVudC…
The premise that seems to under lie most of the comments regarding housing affordability is a cultural expectation that most New Zealanders can expect to own their own home.
Unfortunately, the reality is that no longer holds true, and while the housing boom from 2012 to 2017 accentuated the trend, the reality is that home ownership has been falling from a high of 74% in 1991 to around under 65% today and continues trending downwards.
While the biggest fall is in the 25 to 34 age group (falling from 65% in 1988 to 35% in 2018) all age groups are showing a decline.
Two worthwhile links are:
The NZ Planning Conference document of June 2019 https://population.org.nz/app/uploads/2019/07/3d-HomeOwnAge_Bentley2019…
And NZ Census Data (unfortunately only to the 2013 census but showing decline in all age groups since 2001):
http://archive.stats.govt.nz/Census/2013-census/profile-and-summary-rep…
As I have previously posted, many middle class New Zealanders wealth has come through home ownership, and that there will be an emerging group of "renting middle class poor".
As an aside: I did comment during the winter that it was the time for FHB to buy as the market had most likely bottomed and that there were upward price drivers which would make housing less affordable for FHB.
In summary, policy drives the presence or absence of affordable home ownership.
Current policies are not supporting it.
Alternative policies could support it, as past policies have (1991 data above) for earlier generations. It's about priorities.
Exactly. And despite their bullshit rhetoric, the current government cares about affordable housing about as much as the last....
But they will still garner votes for having aspirations of providing affordable housing.
I think they genuinely do care.. but they are so effing incompetent they can't do anything useful about it. And No, I won't vote for them.
Hi Rick
As I have previously posted; there has been significant socio-economic change since the 1980s and an underlying philosophy that advantages a”privileged”. Wage differentials have become extreme - this was reinforced by the Employment Contracts Act that pushed wages down so that we now talk of the need for a living wage while many are on salaries of $300,000 plus. The non-acceptance of a CGT is another example. In 1980 a recent Pacific Island immigrant without bringing wealth and having a blue collar job could afford a basic Auckland home. Today a basic home is beyond many young Aucklanders on good average wages.
A very sad societal shift.
Agree, very much a change in terms of feeling, policy, what people are told about policy etc. A lot of effort goes into making people vote for policies that won't ultimately benefit them.
If we are going to accept that home ownership is no longer possible for most people, there needs to be better regulations. Regulations to ensure that rental agreements are fair, houses are safe and warm, long term tenancy is promoted, and ensure the ability for tenants to treat the house as if it is their own. We can't have families moving every year or so as they are renting, it is bad for the kids who are our future, people can't settle. Moving is a drain on the resources and mental health of young families.
M_W,
But, you will upset all those 'dedicated' landlords without whom all these ungrateful tenants would be homeless. So what if they are a little damp, poorly insulated and expensive, people should just be grateful to have a roof(leaky) over their heads.
You are of course right, but since as a nation we seem incapable of building decent properties, the chances of properly regulating the tenancy market must be remote-and I am a landlord, though with only 1 property.
Well, it's an absolute clusterf#$% isn't it.
A country that once prided itself on being relatively egalitarian, is now a place increasingly divided into the haves and have nots.
I finally got a letter from Megan Woods. It was long- nearly two pages - but with almost no substance at all. Apparently her team are 'on track'. Yeah, right.
"nearly two pages - but with almost no substance at all"
Shane Warne has lost his spin wizard title to this govt
These generalized reports don't really mean much to me as a possible seller next year. I think the analysis must go deeper and compare say suburb to suburb, house type to house type; Auckland is big enough to warrant doing this. Catch-as catch-can doesn't do it any more...if in fact it ever did. Also the lag between sales and report must reduce. Surely someone can devise an APP for this. An APP can solve anything but there doesn't seem to be one to solve this problem among the 5000 or more out there that have made our lives a breeze.
When you can buy property in NZ for $300k if you borrowed the whole lot at $3.39%, the interest is only $200 per week plus rates and insurance and you have your foot on the property ladder.
It is far from difficult but that’s right, it is far easier to just keep on moaning for the next year and do nothing.
If you are a young person on your own or a young couple with no deposit, all you have to do is use the equity from one of your parents house property.
No $300k won’t buy you a palace in the best area but it is possible to own for far less than renting which will not get you ahead.
$450k with no deposit and interest only is under $300 per week interest.
If you don’t believe “The Man” get alongside an investor that has achieved financial success, and I am sure they will help yo7.
Yes you can buy property in NZ’s best city Christchurch for $300k.
"$450k with no deposit and interest only is under $300 per week interest."
So effectively renting from the bank and praying for capital gains in a podunk town with probably weak employment prospects.. And how likely is the bank to give a FHB 100% financing on interest only terms?
You have the thinking to go a long way pragmatist
We're doing just fine thanks, but unlike some I would prefer to live in a society where we aren't enriching the greedy few by forcing low income people to beg for rental accomodation and prop up the greedy landlord with accomodation supplements and other handouts.
I note with pleasure the progress on the housing NZ housing up the road, another 3 shitty old state houses demo'ed this week, should be another 9+ new state houses up on those sections by xmas next year. And more construction fencing going up around the houses next to them.
That is good to know. Honestly hope you dont see yourself moving there
No, it would take a chain of tragic incidents for us to ever qualify for state housing.
Save up for the $70k then. With two people that is $35k each, plus the kiwisaver welcome home subsidy. It's really not that hard
ah, another boomer/gen X landlord that got on the ladder then pulled it up behind them I see.
Dumb comment and does not address his answer to you. You used to have thought provoking insights Pragmatist you have become more cynical and aggressive over time. Is life passing you by?
I've become more aggressive over time? That's some next level projection you've got going on.
No, just totally sick of the (mostly boomer) spruikers like yourself that trot that shit out. From the absurdity of TM2's suggestion that FHBs are somehow going to get interest only 100% financing, to sham-i-no saying saving $70k is not that hard.. which it certainly is unless you have a decent paying job or are still being supported by family, particularly if you're a young family like many FHBs are.
Healthy market: listings 20% down stock up sales down ; falling % of owners in all age cohorts under 45 esp inAuckland. But all is well as prices rise. Elitist nonsense
Why, in your opinion, should a home owner, property investor or first home buyer care about sales volumes? (Volume, not inventory or days to sell)
You seem to think that these groups constitute entire readership. Also that people are not interested in figs I give. The feedback is more positive than negative numerically. There are about three folk who don’t like it and that is all good
Why not answer my question though?
I’ll broaden the question to include everyone except real estate agents (as the reason that they’re interested in sales volumes in obvious - commissions)
I’ve actually got nothing against you posting sales volumes all day, good on you as far as I’m concerned, but don’t understand why you think this is what people care about and why it is an important indicator.
Sales show affordability and demand and are a proxy for expansion mentality of consumer and whole economy as purchases mostly funded with debt and debt cycle dictates whole economy
To my knowledge sale volume has always been used as a indicator of market confidence and public sentiment. The level of activities is a reflection of buyers/sellers interest. Same as for stock and shares prices, property market is very much driven by sentiment. May not sound very scientific or logical but that's what it is; market sentiment has a strong impact on how the market performs.
mike
Your comment doesn't read well or make sense.
The lower interest rates have permitted / encouraged me to buy another small residential rental. Not that I need the income. Sure it only just breaks even but in time the rent will rise due to our benevolent government. My tenants are not getting the accommodation supplement (wages too high) so no subsidies are finding their way to my pocket. The government and its rhetoric against residential rental providers is causing a general expectation that rents need to go up to match the demand. Next change of tenants I will increase the rent by about $50.
The lower interest rates have permitted / encouraged me to buy another small residential rental. Not that I need the income. Sure it only just breaks even but in time the rent will rise due to our benevolent government. My tenants are not getting the accommodation supplement (wages too high) so no subsidies are finding their way to my pocket. The government and its rhetoric against residential rental providers is causing a general expectation that rents need to go up to match the demand. Next change of tenants I will increase the rent by about $50.
Property investors and first home buyers have done pretty well by buying this year as far as I can tell.
We weren’t actively looking to buy this year as we have more than enough and returns have been excellent.
However have bought 2 more so that we can provide quality housing for people that need to rent for various reasons.
Both returns in excess of 6% p.a. And purchased at below true market value due to circumstances.
Wish everyone including Gordon a merry Xmas and an extremely good 2020!
We are so lucky to have such a generous person in our midst. He made himself buy two more houses he doesn’t need to house the helpless in society. Give The Boy a knighthood. He has no interest in increasing his cashflow or in capital gain. A very remarkable citizen indeed.
Gordon appreciate the sentiments.
Both buys were at auction and I have helped the vendors out financially.
One was a mortgagee auction for a near new home and We were able to have a great tenant ready to move in on settlement date, and they just love it.
Second one was a 4 bedroom family home and the vendors are building, they have stayed on as a tenant until their house is built.
So as you can see we are very caring people, it is not just about making money.
It is often a win/win for both parties Gordon, whereas shares are just a gamble!
All asset classes have risk involved, property included.
Your kind are part of the problem. "i don't need the income" but still brought another house, that could have gone to an owner occupier. Thanks for locking me and my future family out of home ownership. I am very bitter, and will look to vote for people who will reduce house prices back into line with wages in the next election, and any future elections. House prices are ruining our country.
"will ... vote for people who will reduce house prices back into line with wages in the next election."
I know this is an impt issue for you. For me the National party had a good solution with the SHA legislation. Allowed developers to designate as special housing area that meant development could happen without excessive delay. This dumb bunch threw that out because it meant National got credit for a working solution
That's hilarious, the same national party that allowed the flow of foreign and laundered money to inflate our property market? Then failed to acknowledge or do anything about it, while creating one of the biggest risks to our economy? With the PM that made atleast a $10m tax free capital gain from selling his property off the back of it? The party that increased national debt massively with nothing to show for it, and raised GST that affects the poor the most? The same govt that promoted high residency immigration and cut funding to education, emergency services and hospitals at the same time? Hilarious. The National party takes from the poor and gives to the rich. But they fail to realise that such a high level of inequality is actually bad for the economy, as poor people cant participate in being consumers. The current ideologies of the National party are seriously flawed. Rising inequality is dangerous.
But some of these guys did a paper round and brought a house. Its only because people buy tech gadgets and avocados that they cant buy a property.
Like to see a paper round buy a house nowadays.
Or alternatively buy in a location that is cheap, inflate house prices in that area, so the locals have no where to live and have to pay increased rents. What a great country NZ has turned into.
You sir, are a disgrace......I hope all the money you make comforts you while more and more of the youth are locked out of the market by a**eholes with attitudes like yourself - can't ever have enough houses or money right...... Merry Xmas douche bag..
As I posted previously I agree with many posters it’s a travesty what NZ has become. A class based society where getting ahead will be near impossible in the future if you don’t have family wealth behind you. Maori in particular have been absolutely shafted. NZ has been sold off to the highest bidder. It won’t matter how much you earn soon unless you have substantial family wealth behind you and that has literally NEVER been the case in Generations past
Housing further out of reach as Jacinda the liar continues to destroy the country with mass immigration.
That is correct, we can see the effects of mass migration already. Just look at the amount of the expensive vehicles on the roads alongside the amount of the homeless. both have increased. This is not purely based on peoples success and choices in life as some may put it, its because of inequality on the rise. For the ones that are currently sitting comfortably behind the wheel might think this will not effect them, think again, increase in inequality will effect everyone.
"This suggest that the benefits of the most recent cuts in mortgage interest rates would have fallen entirely to people who already owned properties, who would see their property values rising at the same time as their mortgage payments fall."
You could say the benefits go to an earlier generation as is so often incorrectly claimed about boomers. The truth is that those who took a "risk" before July/August also saw the fruits of their decisions. I am glad that we gave advice to hopeful fhb here on interest.co and that some did buy a first home and reported back their decisions. Well done to those people and to other potential buyers I hope you are able to find the type of home you want.
I might be able to, but what about the guys after me? All future homeowners cant jump and buy immediately when you say so. As you know it takes years to save for a deposit.
Exactly right. What an astonishingly simplistic comment.
And you're full of SHIT
MW, yes you are possibly correct, however I know that it is more about financial illiteracy rather than saving for a deposit.
Reality is that more people than you realise could get into their first home if they were taught how to do it, rather than just constantly moaning.
Auckland with the high prices can make it difficult and the cost of living is also much higher than elsewhere and wages don’t tend to be much higher in general.
There are a lot of parents who hold good equity in their owner/occupied home that could easily be providing a deposit for their children but for some unknown reason they don’t do it.
It would be better if banks lent responsibly though.
I would prefer NZers start up businesses and looked to export services and goods. Increase our presence in high tech industries and bring in cash from overseas, whilst keeping the costs of goods, services and property down.
This would be more helpful then every man and their dog buying property.
Simple Maths if every person had 2 houses how many homes, would have no one in them. Presuming your not a child and lived with your parents. Not sure but that type of economy doesn't sound like a great one.
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