Average national asking price on Realestate.co.nz down $110,515 since February, Auckland down by $143,000

The snowball grows....

At current prices, the exit door is still very small. 

I admire the change in your thinking over the past 2-3 years on the housing market, Yvil. From a real spruiker- you can never lose with property! - to someone who is much more objective and balanced on this issue

No real change in the number for sale in the BOP. I have been monitoring Trade Me for 5 years now, total listings only fractionally higher than I have seen it in the past.

I've seen many of these.

The trickle of new builds being listed for sale in Jack Point is turning into a grade 2 rapid. $2.8m asking for a $500k build, there is going to be some hefty discounts I'd imagine.

And elsewhere....

RV's in our area down 12.9%; rates courtesy of this morning's Inbox, up a nominal 7%.

Would be a magical moment.. suckers for punishment 

Toye .....had a conversation with someone yesterday about that ...they were pissed !!! 

I can see a movement brewing where the Auckland Mayor is going to be absolutely inundated with howls and screams of disgusted ratepayers ...and it's going to be way too much for him and the Council to handle .....wonder what he will say to all this, when he has been banging on about Council and all and sundry cutting back on costs ! 

I have always said this country lives way beyond its means .... 

Wellington valuations due next month, I'm expecting a chunky 25% drop. No biggie, it was never worth the 2021 RV.

I just got my Christchurch rates assessment.  $9,280.  That amount would get me 5* resort facilities in a luxury apartment building on the Gold Coast.  

(For those that think I must live in some Fendalton mansion, I don't.  This gets you a 2016 built 4 bedroom home on a 500 sqm section in a decent suburb with a median sale price of $725,000).

The market's been overpriced since the early 2010's.

Agree, asking prices are a leading indicator to the coming larger drops.

Welcome to the team.

The current prices paid are a reflection of vendors not dropping price, hence so little is actually selling. There will be a step down to the current offer level over summer.   We could easily see a -3% or -4% month soon.  Nothing will have changed except the vendors finally taking current offers.    Buyers are tryers and will lower offers as well, like all markets at each level the weak hands have to be shaken out. Its only once weak hands , retiring ,downsizing vendors are meet in equal number by new buyers will we see the final valley shaped bottom, it will feel dead for ages.

When's that RookieInvestor chap going to say something similar? Eerily quiet now

These current and future losses will, will without doubt be financial WMDs for the NZ economy.  Banks stable??

According to the central bank, the commercial banks are stable as. But that doesn't really matter anyway. Taxpayer is backstopping them. 

Remember that the Funding for Lending program was there supposedly as an "investment in NZ", not for the banks to issue debt on existing housing stock as if no price is too high.

Nobody holds the ruling elite to account. The sheeple are left to their own devices during these periods of extreme exuberance.    

There are thousands in your position, good luck to you, I think you will be able to to get close to 5.5% by March or just after.

Over leveraged speculation is akin to gambling. It is quite different to true investment with a risk balanced return/yield. Banks lending practice and central bank actions have rewarded the gambling option for so long people thinks it normal. It is not. In the US you can send the keys back to the bank via no recourse lending. The opposite applies in NZ. We are more aligned with its original definition under French Law used during in the Middle Ages meaning "death pledge". A rate change of 5.5% would be a big drop from today's 6 month rates of more or less 7%.

Do you mind discussing your thinking here, eg carefully weighed analysis or other etc...?

Hang in there! 

Sadly, there'll be a few lurkers here that wish you nothing but ill will, but remember, it always rains after a drought.

I've seen sales for less than half of CV as well, it doesn't mean its the norm.

Did they offer a gold bar with it? 

Thank god, we were all worried for a moment.  Nothing to see here folks, Realestate.co.nz are just being doom and gloom goblins.  

The first one

Ha, I thought they were already gone.

Yep. Those job losses are being felt in probably every industry right across the lower North island. My cousin is a builder there and he said work has dried up pretty much. A lot of people have jobs because of the public sector, and contracts are getting cancelled left right and centre. It's a dark day for this country. I don't think I've ever seen it in such a dire state. 

Wellington is right f%%#ed

It did happen under a Labour Govt.  

While the NZ housing bubble's initial trigger was the opening up of lending and snowballing equity in the 2000s, Labour's money printing policy and encouragement of artificially low rates and and LVRs definitely supercharged the bubble. It didn't matter who was in power, this bubble was going to bust. The only options to keep that from happening are exceedingly reckless...and I worry the current coalition will implement them instead of letting the market take a natural correction.

Could be.

But if they fall 30%, a lot of owners of 'investment' property are going to the wall. And as we all know about DEBT - it's nominal, and not only can it take all your current assets, but those that you are yet to earn.

That's the wonderful thing about speculation - it goes both ways. And often against the holder of assets at the most inconvenient, unexpected of times.

(That's why Crashes happen. Black Swans and all of that.)

Walk the Talk

"Time to buy, next year we might see 5-10% jump in house prices "

Here is one for you to buy:

https://www.oneroof.co.nz/news/latest-news/pm-selling-1m-investment-pro…

Yes, somehow in the middle of the growing recession and widespread job loss, housing will surely make a recovery. 

Which indicates that the developers are building to meet future demand - town houses. So those caught with other product, e.g.: the old 4/5 bedroom stand-alone, are in for a challenging time. Even worse. Those caught on a 10 acre life-sentence block away from Countdown; the doctors and the public transport (the older we all get, the less chance that we keep our driving license etc)

800K is still well short of the average Auckland "House" price, hence the market is being dragged down by places that are in no way comparable to a decent 3 bedroom on a stand alone section. Anyone who has lived in a variety of places knows full well the difference between the two.

wonder if they will get finished.

I know someone who bought the site next to them for $2.38 mil a few years back, where going to bowl both and put units in....   not so much now, was passing in at auction last month now asking $2.45 mil     

Its going to really sting, to move that on.   Bedrooms too small, not a problem if you going to bowl it, big problem come sale time, maybe $1.85...

You mean the online estimator operated by vested interests. Not holding my breath on that.

Owner going to need to take a downward revaluation on the property now?

Unfortunately most people are financially illiterate and do not understand this.  This applies to all the vendors who have pulled their houses off the market in order "to wait until prices recover".  They fail to understand, that even if prices do recover, that means the house they want to upgrade to has also gone up in price, and they will have to borrow more to cover the gap.  Whereas even if they sold now "at a discount" they can then go buy something "at a discount" and save themselves some money.  Even better, if they wanted to rent for 6-12 months in between selling and buying, they could buy something at "an even greater discount".   But no, they sit there in their old house waiting for the house they want to buy to become extremely unaffordable, only to find out later that the bank won't lend the money to buy their dream home due to servicing limits and DTIs

LOL

Yep BUBBLE.

We are still very near PEAK BUBBLE. Warning, warning!

It is not DGM to state that bubbles are very dangerious and the FACT is that ALL BUBBLES BURST COMPLETELY. 

There is no alternative.

Those that ponder taking  anything near 1 million in debt as a FHBer, are a problem to themselves, and taking monumental financial risks. 

They should be in a straight jacket and padded cell, just to stop stupid, self financial harm. But no, we won't do such sensible things and let people pick up heavy, debt grenades and put said "pin pulled"  explosives, in their pockets.

They are much safer buying within their means, that allows comfortable repayments ar 9.5% interest rates.

This is obvious right?

So some free and usefull advice for FBHs:

Don't be the landed gentry Boomers, bag holders, high priced liquidation IDIOT and don't take Debt of anything more than 400k.

HINT: Don't be buying off or near Wingers swamp, in the Riverswamphead.

Live humbly at the start FHBers.

Hold off the champers lifestyle untill it matches your diversified, much later wealth. Live humbly.

A return of the 2008/2009 "free car" with every new Horncastle Homes build type of model. 

I wouldn't necessarily call it a market distortion, while one developer may offer a $10k cash back another might price an "identical" property $12k less.  The lenders might want to be aware of it.  While they're happily writing up the loan, they are in a roundabout way "overlending" by $10k and in hindsight may have preferred to loan $10k less to limit exposure.  

Cash backs are great for the developer but not for the buyer.  The buyer is effectively overpaying for the property by $10k, borrowing an extra $10k from the bank and paying interest on it for 30 years, just to get $10k cash to go spend on something like a couch.  They would be far better off getting $10k off the price.