CoreLogic says cuts to mortgage interest rates haven't flowed through to higher house prices, which are continuing to fall.
The property data company's Home Value Index, which tracks the estimated value of all residential dwellings throughout the country, declined by a further 0.5% nationally in September.
That was the seventh consecutive monthly fall in the country's median dwelling value. See the table below for the full district and regional values and their changes over one, three and 12 months.
The national median dwelling value has declined from $844,825 in February this year to $805,426 in September, a decline of $39,999 (-4.7%).
CoreLogic chief property economist Kelvin Davidson said the latest home value figures were patchy and generally sluggish around the country.
"There are signs that lower mortgage rates have started to boost sentiment in the housing market, but this is yet to meaningfully flow through to hard pricing indicators," he said.
"To be fair, the trough for this latest episode of falling property values may not be far away, but I'd be cautious of assuming that the end of a downturn suddenly means the start of the next upturn."
"Reasons for caution include still stretched housing affordability in most parts of the country, an elevated stock of listings on the market and the weaker employment figures that are now showing through," Davidson said.
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| CoreLogic Home Value Index | ||||
| September 2024 | ||||
| Median Dwelling Value | Monthly change | Quarterly Change | Annual Change | |
| All of Aotearoa | $805,426 | -0.5% | -2.4% | -1.2% |
| MAJOR CITIES | ||||
| Hamilton | $748,147 | -1.2% | -2.3% | 0.7% |
| Tauranga | $899,685 | -0.3% | -2.4% | -2.3% |
| Wellington | $808,753 | -0.5% | -3.2% | -1.1% |
| Christchurch | $663,337 | 0.0% | -0.3% | 2.4% |
| Dunedin | $601,300 | 0.1% | -0.8% | 3.5% |
| REGIONS | ||||
| Northland | $709,079 | -0.8% | -4.4% | -4.6% |
| Auckland | $1,059,472 | -0.7% | -3.5% | -3.9% |
| Waikato | $782,998 | -0.6% | -1.5% | 1.2% |
| Bay of Plenty | $821,074 | -0.5% | -1.7% | -1.5% |
| Gisborne | $572,037 | -1.2% | -3.1% | -5.1% |
| Hawke's Bay | $670,163 | -1.0% | -2.7% | -1.5% |
| Taranaki | $617,575 | -0.3% | -2.2% | 7.2% |
| Manawatu-Whanganui | $536,741 | -0.6% | -2.2% | 0.2% |
| Wellington | $792,393 | -0.5% | -3.2% | -0.7% |
| Tasman Nelson Marlborough | $755,650 | 0.1% | -0.5% | 2.1% |
| West Coast | $413,059 | 0.2% | -3.0% | 5.1% |
| Canterbury | $686,636 | -0.1% | -0.5% | 2.4% |
| Otago | $681,493 | 0.0% | -0.1% | 2.9% |
| Southland | $479,851 | 0.4% | 0.4% | 4.7% |
| West Coast | $413,059 | 0.2% | -3.0% | 5.1% |
| DISTRICTS | ||||
| Far North District | $640,577 | -1.1% | -5.5% | -6.3% |
| Whangarei District | $728,558 | -0.6% | -3.4% | -3.1% |
| Kaipara District | $787,833 | -0.6% | -5.8% | -6.1% |
| Auckland - Rodney | $1,207,956 | -0.8% | -4.2% | -4.0% |
| Auckland - North Shore | $1,253,214 | -0.7% | -2.7% | -4.0% |
| Auckland - Waitakere | $922,227 | -0.6% | -2.6% | -4.4% |
| Auckland - City | $1,144,784 | -0.9% | -4.2% | -3.6% |
| Auckland - Manukau | $1,000,480 | -0.6% | -3.0% | -4.1% |
| Auckland - Papakura | $809,028 | -0.4% | -3.0% | -5.3% |
| Auckland - Franklin | $922,635 | 0.0% | -2.2% | -1.8% |
| Thames-Coromandel District | $1,013,959 | -0.5% | -1.4% | 1.3% |
| Hauraki District | $663,823 | 0.2% | 0.4% | 1.6% |
| Waikato District | $928,478 | -0.4% | -1.7% | 3.2% |
| Matamata-Piako District | $717,809 | -0.3% | -1.1% | -0.9% |
| Hamilton City | $748,147 | -1.2% | -2.3% | 0.7% |
| Waipa District | $901,266 | -0.3% | -1.7% | -0.4% |
| Otorohanga District | $609,981 | -1.1% | -3.8% | -3.6% |
| South Waikato District | $423,273 | -1.0% | -3.1% | 0.8% |
| Waitomo District | $455,276 | -0.2% | -2.0% | -0.4% |
| Taupo District | $785,701 | -0.1% | 0.8% | 3.4% |
| Western Bay of Plenty District | $1,046,807 | -1.0% | -1.4% | 0.1% |
| Tauranga City | $899,685 | -0.3% | -2.4% | -2.3% |
| Rotorua District | $602,019 | -0.7% | 0.1% | -0.4% |
| Whakatane District | $687,164 | -0.4% | -2.0% | -4.5% |
| Kawerau District | $396,031 | -0.5% | -1.7% | -4.4% |
| Opotiki District | $557,826 | -1.3% | -1.2% | 4.2% |
| Gisborne District | $572,037 | -1.2% | -3.1% | -5.1% |
| Wairoa District | $420,564 | -0.9% | -2.8% | -0.5% |
| Hastings District | $705,059 | -1.0% | -2.6% | -1.5% |
| Napier City | $676,048 | -1.1% | -3.2% | -1.9% |
| Central Hawke's Bay District | $612,056 | 0.1% | -1.0% | 0.0% |
| New Plymouth District | $669,129 | -0.3% | -2.3% | 9.2% |
| Stratford District | $491,747 | -0.2% | -2.7% | -3.7% |
| South Taranaki District | $444,449 | 0.0% | -1.1% | -0.4% |
| Ruapehu District | $386,162 | -1.1% | -2.7% | -2.7% |
| Whanganui District | $489,570 | -0.7% | -1.1% | 4.6% |
| Rangitikei District | $442,425 | -1.2% | -3.0% | -1.5% |
| Manawatu District | $625,008 | 0.1% | -1.6% | 1.7% |
| Palmerston North City | $600,505 | -0.4% | -2.0% | -0.6% |
| Tararua District | $415,247 | -0.9% | -2.5% | -2.5% |
| Horowhenua District | $514,708 | -0.9% | -3.8% | -1.9% |
| Kapiti Coast District | $800,931 | -0.8% | -3.7% | 3.0% |
| Porirua City | $764,673 | 0.4% | -2.0% | -0.6% |
| Upper Hutt City | $742,832 | 0.1% | -2.5% | 2.2% |
| Lower Hutt City | $696,118 | -1.1% | -3.8% | -0.7% |
| Wellington City | $905,980 | -0.5% | -3.4% | -2.0% |
| Masterton District | $549,621 | 0.1% | -1.1% | 0.9% |
| Carterton District | $673,867 | -1.1% | -4.5% | -3.2% |
| South Wairarapa District | $758,183 | -0.9% | -3.4% | -6.6% |
| Tasman District | $858,878 | 0.1% | -0.7% | 3.7% |
| Nelson City | $719,987 | 0.1% | 1.2% | -0.3% |
| Marlborough District | $683,794 | 0.0% | -1.9% | 2.6% |
| Kaikoura District | $755,841 | 0.5% | 1.2% | 5.1% |
| Buller District | $372,725 | 0.2% | -3.2% | 4.5% |
| Grey District | $411,127 | 0.1% | -3.2% | 6.3% |
| Westland District | $461,050 | 0.3% | -2.5% | 3.8% |
| Hurunui District | $683,800 | 0.3% | 0.4% | 2.2% |
| Waimakariri District | $752,440 | 0.2% | -1.2% | 1.9% |
| Christchurch City | $663,337 | 0.0% | -0.3% | 2.4% |
| Selwyn District | $862,637 | -0.3% | -0.6% | 2.2% |
| Ashburton District | $535,637 | 0.1% | -0.4% | 2.6% |
| Timaru District | $512,687 | -0.4% | -1.7% | 3.2% |
| Mackenzie District | $694,983 | -0.2% | -0.5% | 1.1% |
| Waimate District | $529,231 | 0.2% | 0.0% | 2.9% |
| Waitaki District | $472,002 | -0.2% | 0.1% | 4.7% |
| Central Otago District | $829,439 | -0.2% | -0.6% | 1.9% |
| Queenstown-Lakes District | $1,669,685 | 0.0% | 0.7% | 2.5% |
| Dunedin City | $601,300 | 0.1% | -0.8% | 3.5% |
| Clutha District | $415,708 | 0.3% | -0.5% | 5.2% |
| Southland District | $569,246 | 0.7% | 1.8% | 3.1% |
| Gore District | $429,844 | 0.4% | -0.3% | 3.8% |
| Invercargill City | $464,444 | 0.2% | -0.1% | 5.2% |
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141 Comments
Can we call it a crash yet?
No, only once its done.
Good point. So can we say it's crashing?
Sure, if you don't mind being pummelled with ad-hom🤣 For some - reality hurts especially once declines are adjusted for inflation. Houses should be for living in rather than speculating on.
The ad-hom brigade are still asleep. Must have been up all night sweating bullets over the excel spreadsheets.
The plight is that they are unaware their spreadsheets are as screwed up as them
Or maybe they're just in Spain holidaying in their apartment… (and doing some refurbishing for better rental rates)
Most are lucky to standstill after a refurb…
Tenants / Buyers care little about this in todays market….
I must be extra lucky then :-) I'm not after buyers or tenants, I'm after guests.
(BTW, I didn't know you were a specialist in coastal apartment values on the Costa Blanca.)
Yvil, do you have links to the Costa Blanca? Altea? Alicante? Calpe? Benidorm?
I see you know the Costa Blanca well. Saying that I climbed the Peñon d'fach 2 days ago should give it away for you.
Stunning. I've made the climb many times myself, once saw basking sharks from the top. Enjoy the food, history, weather and people.
Awesome, well done!
If you're Interested (pun intended), you can rent my apartment next time at -20% mates rates.
It's beach front (primera linea, lol).
Very generous, I have property in that area, in a nearby pueblo, but beachfront would be nice for family visiting.
I don't fly as often anymore, emissions guilt, maybe one day, if the coalition keep going and I can't stomach staying in NZ, we'll have a caña.
I’d be in for a cana too. Greetings from Estepona!
The reduction of emergency housing tenants must be hurting Yvil...although you could now sell them sleeping bags and tents?
Thanks for your concern Baywatch, it's very kind of you to care about my financial wellbeing 😘
The ad-hom brigade are still asleep.
Eh? you were replying to the king of ad-hom
You obviously slept in.....
No, busy at work actually. Some of us do actually have better things to do most days.
When crypto is down 90% in a year that's a crash.
When stocks fall 20% in a year that's a crash.
When property falls 1.2% in a year - that's a speed bump. Even with a pathetic 2% net yield, its still positive. Just.
(Of course if you are 90% leveraged then that's a different story)
House prices are sticky on the way down, so a 20% fall in stocks in a year is a crash, a 20% fall in 2 - 3 years might be considered a crash for property. Property prices do not crash overnight.
- NZ Total 30 Nov 2021 $925k, NZ Total 31 Aug 2024 $765k
- 17.3% (still not technically a crash).
- AKL 30 Nov 2021 $1.3m, AKL 31 Aug 2024 $960k
- 26.2% hmmm...
https://www.interest.co.nz/charts/real-estate/median-price-reinz
Well, Nzdan, what do you call a 30 % to 40% decline within a year or so? It can happen! I was there building 3 spec home units with my father in 1979 immediately after the global oil crisis ......we were forced to sell them for around $30,000 each, when the market normally would have given us around $45,000 each.
What your are seeing now are mere re-adjustments because of Covid followed by Labour, floundering, throwing unlimited money at all and sundry. The real estate spruikers then naturally took advantage of this situation.
An important statistic would be if house prices dropped below the levels they were at just before Covid struck. If they haven't fallen beneath those levels then there's nothing to get excited about. You could say that the prices just before Covid should be the datum or the baseline of any statistical comparison, and not the prices since Covid.
So, perhaps some statistician out there can tell us how the latest prices compare to that datum. Only if prices have materially fallen below that datum would there be a decline worthy of note.
You forgot to add inflation adjustment to those losses. Let’s say a further 15% drop. So Auckland down about 40% in real terms
Except crypto and shares are highly liquid markets where prices can move quickly. It's not unusual to drop 20% in an hour in the former.
Property is perhaps the most illiquid of all assets (As many are now finding out to their detriment). This means that any obvious cycle takes much longer to play out. This one has certainly not finished.
Using the actual sale figures from REINZ (true value, rather than Corelogics 'estimates'), Aucklands median house price has dropped from 1.3M at peak November 2021, to around 960k now, that's a decline of around 26%. That's a property crash. Adjusted for inflation, we've seen a decline of around 34%. A third of value has been lost in less than 3 years, a lot more than a speed bump.
Except crypto and shares are highly liquid markets where prices can move quickly. It's not unusual to drop 20% in an hour in the former.
In early August 2024, several popular memecoins fell by over 20% amid a broader market crash triggered by global economic concerns. Notably, the total memecoin market cap dropped over 22%, with specific tokens like BONK and WIF experiencing declines of 24% and more.
Auckland CVs to be reviewed in 2025?
Wellington RVs are in the process now. Looks like they will be up roughly 15%.
...on 2018 valuations.
Auckland CVs should be out this month which will be another reality check for vendors wanting anything near 2021 prices.
Grab the popcorn. This will get the boomers even more angry than a 30 kph speed limit. Lets await the flood of revaluation requests.
Accompanied by the ill-informed "at least this means my rates will be cheaper" comments.
Ha! Always a joy! Though as I've discovered, if the decline in commercial values is less than residential values, there will be a small downward adjustment in residential rates so they are about 10% correct!!
Updated CVs are ridiculously overdue... sellers still in total la-la-land. Case in point this tiny 3 bedder with dodgy piles and no insulation on a dank, sunken 300m site has a CV of over 2.5m. Go figure. https://www.trademe.co.nz/a/property/residential/sale/listing/489978242…
Holy crap. The Grammars are good schools but not that good. Not by a long way.
I want my
I want my
I want my capital gain...
What a joke. Stick with MTV.
I have asked Hamilton City Council when the new RV's will be made public.
Many of the main centres are due to be revalued this year, according to this article:
"Different authorities are on different schedules, but Auckland, Wellington, Hamilton, and Tauranga are among 20-odd local authorities due to have their RVs updated in 2024.
The new values will be used to calculate rates from 1 July 2025. But they will be made public in December, with the exact date dependent on the audit process, a Wellington City Council spokesperson told RNZ"
https://www.rnz.co.nz/news/what-you-need-to-know/527715/rateable-values…
Looks like they're early next year for you guys:
https://www.qv.co.nz/services/rating-valuations/rating-revaluation-sche…
Update: HCC have replied
"The rateable values are currently being assessed, but the results aren't expected to be released until approximately February next year. We do not have a more specific release date at this time."
My guess is that all council revaluations will be delayed.
Why?
They have the potential to trigger a further collapse.
Ya know, it's a financial stability thing and we can't have our precious Australian banking cousins put under pressure, can we?
When the valuations are this bad and this low......and financially disastrous, for the overlent banks.....they just have to lie....or just delay.
When the valuations are this bad and this low......and financially disastrous, for the over-lent banks.....they just have to lie....or just delay.
Down down down in ponzi town. Financial reality continues to apply. The greed during Covid money splurge was strong.
🍿 + ⛽️ = 🔥
Only Auckland and Wellington, really, have had major drops in prices.
In the past year, prices in Hamilton, Dunedin and Christchurch have gone up.
And the drop from the post covid "peak" has been around 12% for most places - the NZ average of 17% drop is due to the 26% drop in values in Auckland.
Like I've said many times Auckland is overpriced.
the best thing about Hamilton is the new bypass motorway
Classic strawman argument, IT Guy. I'm surprised to see you on this thread today. You've been banging on about -10% for so long, it must be a shock and disappointment for you to see that the drop is only 1.4% for the past 12 months.
Median value doesn’t mean much when 55% of what is being sold are townhouse/high density 😂
I agree with the principle of that assertion but… have you got a source for that 55% figure?
Nah hm, was more of a shitpost with small truths in there :)
CoreLogic has moved to an hedonic index, which separates out compositional changes, so should give a more reliable indication of the actual market movement compared to a simple median or average used by some other data providers.
Wait for the REINZ report then. They adjust for mix.
Is this the fourth or fifth bottom?
The bottoms are getting bigger..
"Fat bottom girls…" ?
call her Kim..
Does Kim "make the rocking world go round" ?
No but she made Kris and Kanye a bit poorer..
But but but Riverboghead, ChchSwamplands, Taurangatrafficjamland.......all going gangbusters...NOT.
Rubber meets the road for Spruikuvesters.....or Wileeeee E Coyote meets hard and unforgiving tarmac.
Expect to see the spruikers all have their ritualistic HOPIUM smoking, support group meetings, on the FB Housing accumulator/investor pages.....all applying creams and soothing each others sore, red and flogged out Backends/Bottoms.... Then trolling trash talk, in unison, of more hopium that, "the bottoms really, really, really, now in". Comically seeing ForeverBottoms here:)
Buy now , beeee quick, as ole terrible Tones the Comb always recommends, to everyone's financial peril.
The Crash is just Midway.....watch out below!!! Yee wistful Peasants are all warned!
Gecko, where is this supposed crash of Ch.Ch. Prices?
Must be reading different figures than yourself!
Not sure why so many are delirious about some places housing prices having dropped due to interest rates having increased from their lows?
Reality is that we all know that Auckland prices were overpriced for what you get and were solely influenced by immigration.
The housing market is just not Auckland and high time the media stopped thinking it was.
Christchurch leaves it for dead for liveability.
Now look here, 3rdleggedraceman, the country is much larger than the Swamp and Quake prone Cantab town.
Time you look at the NZ situation and not just the flatlands.
To be fair Chch is not for you anyway Gecko!
We prefer productive people!
Productive as in investing in residential property as an all in?
We are productive in providing accommodation to those that need to rent.
I am not an investor that sits around, I am continually doing things on property as well as employing trades people.
Property investors deserve any capital gain they get, as without them there would be may unhoused.
Two sales down the road from me were sold at a loss (Christchurch, in the CBHS/CGHS school zone so $$$)
#1 Sold in 2022 for $1,079,000 and sold today for $950k So a $129k loss, plus RE agent and legal fees.
#2 Sold in 2022 for $989,000 in 2022 then for $891,000 in 2023. A loss of $98k, plus RE agent and legal fees.
Two people that bought poorly, and clearly due to schooling requirements.
I never said that everyone is capable of investing well, and I often see property that is undersold by agents.
Never lost money on any property purchased and never will!
As interest rates fall and job security weakens, 2 things are likely to happen:
(1) Those with Debt will use the addition liquidity to pay down their outstanding negative balances - not 'go out and spend it', and
(2) Those who recently enjoyed the benefit of interest paid on their positive balances will stop spending, as their reduced liquidly falls - not "go out and buy more because the % rate is falling"
Strap those two on to an ageing asset owning demographic, and we'll likely get a downward spiral of economic activity punctuated by increasing bouts of asset selling, as those who want to retrieve their savings for retirement look to cash in.
While I don't fully agree with what you are saying - reality is that the situation is more complex / nuanced than the simplistic interest rates drop / house price goes up mentality.
Those are two wild assumptions you're making there bw, the outcome of your 1) and 2) could be very different from what you believe.
Fair enough. But tell me, how are you reacting/going to react to the situation of falling % rates? Has your spending gone up or down?
Lower/falling interest rates are an indication of rising risk - only 'the good stuff, the less risky stuff' gets to borrow at lower rates.Debt becomes harder to assume, not the other way around. And this time; finally, most of us know it.
Fair question bw, my spending is fairly constant, but if it is to go up or down, it's more a function of my businesses doing better or worse, rather than because of interest rates changes.
Interest rate changes are more likely to affect my propensity to borrow more or less to invest in property, rather than my spending habits.
Any better than your assumption below that lower interest rates will mean higher house prices - just saying
My post below does not say that "lower interest rates will mean higher house prices". That assumption is entirely yours.
There is an implicit assumption in your statement that lower interest rates will mean higher house prices. While you don't say that implicitly it is inferred - how else could it be interpreted?
EDIT - spelling
The speaker implies, the listener infers.
Putting that CoreLogic quote in your post and then your response to it implies that's what you meant, it's obvious.
And yet could be bang on - I personally think both effects are likely.
Golly, bw, for a macroeconomic debt freak like yourself, those are good microeconomic insights.
Both are reasons why we'll 'bounce back slowly' when the RBNZ gets back to neutral. (OCR is neutral at 2.75%. Or so the RBNZ says.)
CoreLogic says cuts to mortgage interest rates haven't flowed through to higher house prices, which are continuing to fall.
Much too soon for the minimal interest rate cuts so far to have any effect on house prices. Revisit this idea in 12 months time, when the OCR is between 2.5% and 3.5%.
Wow. When we are stull in the lower end of long twrm normal, you really see the OCR getting that low. Would you mind discussing why?
The neutral OCR, which neither stimulates or slows economic activity is about 3%.
Sure, btw I have made that call in August, after getting the date of the first OCR cut right, 14 months ahead of time.
The neutral OCR is about 3%, so any level above is still contractionary, which NZ can't live with when the economy is in such bad shape as it is now. The OCR will be cut in bigger increments than 0.25% (this is becoming more apparent now).
Dooooooom
A bull-trap often forms when i-rates first start to come down. Take care.
Yes. The RBNZ 'neutral rate' for the OCR is 2.75%. ... Might I remind everyone that we should be close to this rate NOW !!!!
Is Auckland not a Major City?
No, it is not. Officially there is seemingly no city called Auckland.
Auckland is a SuperCity, which means it is a region.
The contiguous urban/suburban sprawl which exists in the middle of Auckland region does not officially have any name and it is definitely not called for example Auckland (apart from by everyone non-official).
Thanks. A great comment. Why? Because it's true.
While I'm based in the North Island, I know how this country rolls so it was no surprise to see the south island house prices being the best performing because typically a recovery starts in Southland and rolls up the country.
I think this is happening now with Southland doing great with no sign of a recession down there. Farmers with money tied up in closely held 'central' suburbs like Wanaka, Arrowtown & Quail Rise which all have minimal listings.
Christchurch doing great with a lot of excellence with their convention centre, nearby hotels, a theatre and stadium that are about to open, Canturbury Uni going gangbusters and becoming the most preferred.
So keep it up the South Island!
Why is that? Why do house prices start rising in Southland and work their way up the country? When was the last time we had a housing recovery?
Because the centres in the South island (Nelson, CHC, Dunedin, Invercargill) had generally a much much lower price level than the main centres on the North Island.
A lot of people have moved South because a) it's affordable, b) they could find work or wfh and c) the outdoors are just awesome. I personally know three families that made the move.
A price half of what you pay in the North provides more upward potential. Queenstown was a bit of an outlier, prices there were red hot due to tourism, they dropped quite a bit due to COVID but it's creeping back up.
Moved to Queenstown a few years ago from Auckland for reasons B and C.
Unfortunately kept a house in Auckland in case South Island didn’t work out and it’s dropped $400k in value.
Hindsight is a wonderful thing.
Your lovely view and lifestyle in Q'town is wonderful too no doubt :-)
Your Queenstown pad has probably gone up by at least that value. I think you might be okay :)
The examples you have provided does not explain why Epsom thinks house price recovery contagion starts at Invercargill and works its way up the country. It explains why after Covid the regions have done so well.
Unless you believe that when house prices bottom out, employers start giving everyone WFH flexibility and people flock to Nightcaps?
Have a relative who works in the mental health sector in Southland. Sounds like a shocking place to live for mental sanity - high rates of depression/suicide. The weather down there is also shocking - probably worst in the country in terms of rainfall/average temperatures (ie it’s a cold and wet and grey s%^*hole on a regular basis).
Is it due to D/I levels within each region?
Places which were lowest cost prior have the lowest absolute debt levels now. Meaning their D/I decreases faster and allows them to borrow more sooner.
Agreed, it often looks like that.
But only because mainlanders don't indulge in the extremes of silly Aucklanders (and more recently Wellingtonians). Both "recover" at basically the same time, give or take a quarter.
My area is down a whopping 4% for the year.
How much since the peak and then adjust for inflation.
Its easy to forget the importance of farming in NZ
Its funny we drove home from Turangi yesterday and my 16 yo daughter commented.
Dad, most of NZ is farmland, why is everyone so vocal anti farming....
I said the greens have a political voice vs the other 88% of voters who in general do not hate farmers...
Think that hate NZ farmers narrative only holds if you live in central Auckland or Wellington with strong left-wing political bias.
LOL. I live in Auckland and have farming relatives and holdings in the SI.
Kiwis are, with regards farms, as ignorant as they are with regards finance and economics. I.e. water off a ducks back.
The Greens don't hate farmers?!??
They just think farmers have a responsibility to not fuck up the environment. You can want the latter and not hate farmers.
well that's how kids are hearing it.....
Okay. I now understand your intellect. ;-)
My area's up 68% in the last 3 years.
Where's that champagne?
No champagne, just scoop some brown muddy water out of that river, btw mosquito larvae are good protein !
Easy in areas that used to be bare land a couple of years ago and now have been built on. But no one mentions that.
Ex: Peacocke in Hamilton, +50% yoy
It's worth noting that luxon, who is not a stupid man financially, has just sold 2 properties. I can't imagine he would have sold now if he thought this was the bottom of the market and if prices were about to increase.
I suspect things will gradually go down
Maybe he's got something else in mind he wants the cash for.
When even the King ditches to housing ponzi........we all know its time to get out of Dodgeponzi city!!!
Yip and John Key bailing from ANZ as well with its exposure to Nz housing.
Sir John must have given him some hot stock tips.
Can't remember who said this but it's still hold true. May be in Luxon's case, it's the chauffeur.
"When a taxi driver offers you stock advice, then remember the markets are overvalued and time to get out"
But in our case it's the wingperson!
Is it?
I can't remember how many properties I've owned, probably about 15, and I haven't made any mistakes yet. And my latest acquisition is soaring according to its online property profile.
It's a great feeling knowing I've still got it.
"It's a great feeling knowing I've still got it. "
Can you ask your missus and come back to us with her response? Please.
On another thread it was his partner who finds his properties for him. So technically, it would be her who still has it, did Wingman ever have it?
Yes us boomers have been lucky over the last 40 years. With our timing and the huge inflation that has occurred. The downside. Everyday more of us are tipping over.
Yes, agree 100%.
Since late 90s I've lost count on the number of times we bought and sold, entirely due to work commitments and relocations.
Looking back we were lucky and that line is getting thinner with the younger generations!
50% of boomer generation will be dead in the next 10-15 years. That is a lot of 3-4 bedroom homes in which they currently reside being sold.
As mentioned a number of time here about 80% of the homes on my current street (around 10-12 homes) are 70+ year old widows living in houses that are way beyond their needs and means to maintain.
The overconfidence bias is strong. Happens when your strategy works for years (or decades) then suddenly things change but you can’t see the risk as you become deluded by your own success. Kahneman (famous for book ‘Thinking Fast and Slow) did some good research on this and it was one of the things he said he disliked the most.
Bit like the complacency risk that experienced pilots can suffer from their wingman. You know if you put two highly experienced captains on the same flight. Risk of an incident sometimes goes up, not down as they are over confident and become complacent regarding risks/safety. Have you lost your edge wingman?
"Happens when your strategy works for years (or decades) then suddenly things change but you can’t see the risk as you become deluded by your own success."
Many people don't know what they don’t know.
"It's worth noting that luxon, who is not a stupid man financially ..."
LOL. Had you left out that qualifier, he's "not a stupid man financially", you comment would be right.
But ask most CFOs if the CEOs are suspect on their financial nous and you'll get a very different view.
Overall values still 16% higher than pre COVID.
🥂
And continuing to sink without trace.. .
Around 10% higher than pre COVID in Tauranga.
So still very overpriced based upon any fundamental analysis/norm - and into a worsening economy?
Not really it depends on many factors including what country you live in. Plenty of countries round the world are turning to shit, some people would consider living here to be cheap.
Fundamental removes anomalies - affordability is the cost of the asset vs your incomes. All the other stuff you mention is speculative dribble with a big scoop of kiwi ego/exceptionalism - ie you’re telling yourself a story to try and justify irrationality (ie delusion).
Our houses are extremely expensive compared to our productivity so fundamentally overpriced and it doesn’t matter where you come from - if you are going to live here and get a mortgage to pay for the asset at current prices it’s probably going to be a real battle and there’s the risk that you may have no or very little capital gains for years (potentially even decades).
But inflation has been a cumulative 23% over the ponzi time. So if prices are above pre covid times by 16% they have actually dropped 7% .
Using Interest.co.nz data to identify a possible bottom before the silliness and the corresponding wobbles occurred. The difference between the 2021 and the 2024 median price is significant (23% drop from peak). If higher interest rates are driving the economic downturn, and people have learned not to overcommit, the figures suggest the bottom is still to be found.
Year. Median House Price (Auckland, NZD). Change from 2019. Interest Rates (RBNZ OCR)
2019. $850,000 0% 1.0%
2020. $885,000 ~4% 0.25% (cut post-COVID)
2021 $1,300,000 (Peak) ~53% 0.25%.
2022 $1,000,000 ~18% 3.5%
2023 $1,009,000 ~19 % 5.5%
2024 ~$960,000 (Forecast) ~13% <5.25%
2012 to 2015 Home prices are returning to a town and city near you!
Let's all party hard, when it happens in 2026-2028 :) :)
No, I don't mean Ponzioverpayparty. That party died, sunk without trace, never to be seen again, in late 2021.
You forgot to add wage inflation since 2019.
True. But did you likewise forget to add cost of living inflation (net of housing)?
Looking at the last time the OCR was 5.25%:
- 2004 OCR = 5.25%
- 2004 Median House Price AKL - $330k
- Wage inflation 2004 -> 2024 = 206%
- $315k x 206% = $680k.
Maybe houses were too cheap in 2004, but strictly on an interest rate vs income basis we're still 30% off.
I think a national median price of around $550-600k makes sense. So around 4-5x average household income. Ie representative of what has been fundamentally ‘normal’ with ‘normal’ (non-emergency) interest rate settings.
So a further 25% drop isn’t out of context in my view - is this guaranteed? Of course not! But it is possible if the economy continues to deteriorate, we have low immigration, oldies keep downsizing and mortgage rates bottom around 5%.
Another oldie on my street selling up her 3 bedroom home to downsize into a 1-2 bedroom in a retirement community - will be another family sized home on the market adding to supply (she is buying a new build ready at Xmas). Will be another 5 or so to do the same in the next 5 years - that will be 50% of the street for sale to younger people who want to own 3-4 bedrooms on 500+ sqm sections. These are ok for oldies until they hit mid 70’s then seem to be too much for them to handle on their own (I’m constantly having to help the widows with property maintenance they can’t handle and I think they are al starting to see the writing on the wall with guilt for asking me or others to voluntarily do the work for them or the cost of having to pay $50 an hour for people to cut lawns and trim shrubs and clean gutters etc).
Good analysis. And most likely right.
As someone who lives in Dunedin, it's nice to see Dunedin broken out from Queenstown Lakes and Central Otago to give a much better idea of local conditions, rather than Otago as a whole.
Very much a market divided in to three parts.
Can someone keep receipts on those calling the bottom so we can compile a list of how many bottoms we come across? I heard TA on the Sharesies podcast calling the bottom again today. No rate cut has worked that quickly outside of the COVID anomaly which will not happen again this cycle.
Sure, I'm calling this current 3 month period (October to December) the bottom.
Not sure how you keep a receipt on it, but you are welcome to copy and paste or whatever.
The Spruikers have seen more bottoms then Freddie Mercury
There's the joker who called August - October 2023 as the time to buy but now says it's before Christmas '24, I'll have to act swiftly.
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