Median residential dwelling values declined for the ninth consecutive month in November, according to property data company CoreLogic.
The national median dwelling value was $800,795 in November, -0.4% for the month, -0.8% for the three months to November and -3.5% compared to November last year, according to CoreLogic's Home Value Index for November. (See the table below for the figures for most of the country).
That equates to a decline of $29,100 in the national median dwelling value over the 12 months to November.
"November's results indicate a market that's still in a holding pattern - not falling to any significant extent but not rising emphatically either," CoreLogic Chief Property Economist Kelvin Davidson said.
"As we've seen many times before, the ability of lower interest rates to kickstart housing market sentiment and sales transactions, as well as property values, shouldn't be underestimated," he said.
"But it's also important to note that there are several factors pushing in the other direction at present, such as the overhang of available listings and the weak labour market.
"Although the recent downturn in property values may come to an end soon, it won't necessarily give way to a sharp or sudden upturn," he warned.
The comment stream on this article is now closed.
| CoreLogic Hedonic Home Value Index | ||||
| Residential Dwellings | ||||
| November 2024 | ||||
| District | Median Dwelling Value | Monthly change | Quarterly change | Annual change |
| All of Aotearoa | $800,795 | -0.4% | -0.8% | -3.5% |
| Far North District | $640,861 | -1.4% | -2.8% | -7.8% |
| Whangarei District | $707,777 | -0.9% | -1.7% | -5.5% |
| Kaipara District | $739,740 | -1.6% | -1.8% | -9.4% |
| Auckland - Rodney | $1,203,130 | -0.6% | -0.6% | -3.7% |
| Auckland - North Shore | $1,275,196 | 0.3% | 0.9% | -4.8% |
| Auckland - Waitakere | $920,073 | -0.2% | -0.4% | -6.5% |
| Auckland - City | $1,137,810 | -0.6% | -1.7% | -7.5% |
| Auckland - Manukau | $1,001,359 | -0.4% | -0.6% | -5.8% |
| Auckland - Papakura | $828,763 | 0.0% | 0.0% | -7.4% |
| Auckland - Franklin | $927,133 | -0.8% | -1.5% | -3.8% |
| Thames-Coromandel District | $988,556 | -0.8% | -2.4% | -2.3% |
| Hauraki District | $646,272 | -0.3% | -0.8% | -0.6% |
| Waikato District | $920,894 | -1.0% | -1.9% | -0.2% |
| Matamata-Piako District | $689,060 | -0.6% | -1.2% | -3.2% |
| Hamilton City | $711,016 | -0.5% | -0.5% | -0.7% |
| Waipa District | $891,751 | -0.2% | -1.9% | -2.4% |
| Otorohanga District | $602,512 | -0.2% | -1.9% | -4.0% |
| South Waikato District | $407,807 | -0.5% | -2.4% | -1.2% |
| Waitomo District | $457,449 | -0.6% | -2.3% | -1.4% |
| Taupo District | $759,317 | -1.8% | -1.6% | 0.2% |
| Western Bay of Plenty District | $1,034,121 | -0.8% | -1.5% | -3.3% |
| Tauranga City | $895,662 | 0.0% | -0.3% | -4.3% |
| Rotorua District | $617,747 | 0.0% | -0.8% | -1.1% |
| Whakatane District | $671,671 | -0.4% | -1.8% | -6.3% |
| Kawerau District | $388,240 | -0.4% | -0.5% | -5.9% |
| Opotiki District | $616,670 | 0.3% | -1.9% | 3.4% |
| Gisborne District | $591,140 | -0.9% | -0.7% | -6.2% |
| Wairoa District | $403,441 | -0.5% | -0.6% | -6.2% |
| Hastings District | $712,634 | 0.2% | 0.5% | -2.8% |
| Napier City | $686,926 | -0.2% | -0.9% | -3.8% |
| Central Hawke's Bay District | $589,963 | -0.3% | 0.1% | -1.8% |
| New Plymouth District | $683,868 | -0.2% | 0.4% | 5.3% |
| Stratford District | $498,793 | -0.2% | -0.3% | -2.2% |
| South Taranaki District | $404,292 | 0.3% | -1.4% | -3.9% |
| Ruapehu District | $383,086 | -0.1% | -2.1% | -1.5% |
| Whanganui District | $481,991 | -0.3% | -0.6% | 3.6% |
| Rangitikei District | $454,677 | -0.2% | -1.9% | -3.5% |
| Manawatu District | $593,785 | -0.8% | -2.8% | -1.3% |
| Palmerston North City | $600,225 | 0.0% | -0.4% | -2.8% |
| Tararua District | $410,377 | -0.2% | -0.6% | -5.1% |
| Horowhenua District | $511,160 | -0.4% | -0.5% | -3.4% |
| Kapiti Coast District | $778,536 | -0.2% | -2.2% | -3.4% |
| Porirua City | $720,310 | -0.6% | -1.3% | -4.8% |
| Upper Hutt City | $731,955 | -0.9% | -1.8% | -3.8% |
| Lower Hutt City | $695,747 | -0.6% | -1.3% | -5.0% |
| Wellington City | $886,467 | -1.2% | -2.5% | -6.7% |
| Masterton District | $532,865 | -0.4% | 0.2% | -2.3% |
| Carterton District | $651,862 | -0.8% | -3.8% | -9.0% |
| South Wairarapa District | $761,281 | 0.0% | -1.6% | -8.9% |
| Tasman District | $840,493 | 0.0% | -1.0% | 1.2% |
| Nelson City | $728,558 | 0.3% | 0.8% | 0.6% |
| Marlborough District | $666,180 | 0.3% | 1.1% | 0.7% |
| Kaikoura District | $779,709 | 1.1% | 0.7% | 5.0% |
| Buller District | $357,172 | -0.8% | -4.3% | -1.4% |
| Grey District | $387,586 | -2.1% | -5.0% | 0.5% |
| Westland District | $457,773 | -0.8% | -3.1% | 1.0% |
| Hurunui District | $698,536 | -0.1% | -0.3% | 1.0% |
| Waimakariri District | $762,814 | -0.3% | -0.2% | -0.6% |
| Christchurch City | $671,344 | 0.1% | 0.5% | 1.5% |
| Selwyn District | $878,670 | 0.6% | 0.1% | 1.1% |
| Ashburton District | $556,075 | 0.1% | 1.6% | 3.2% |
| Timaru District | $525,909 | -0.3% | -0.2% | 2.2% |
| Mackenzie District | $692,327 | 0.7% | 0.5% | 0.7% |
| Waimate District | $510,774 | 0.3% | -0.1% | -0.7% |
| Waitaki District | $472,614 | 0.7% | -0.6% | 2.1% |
| Central Otago District | $843,806 | 0.7% | 1.3% | 2.9% |
| Queenstown-Lakes District | $1,499,130 | -0.8% | -1.1% | 2.0% |
| Dunedin City | $615,545 | 0.4% | 0.6% | 1.5% |
| Clutha District | $409,688 | 0.1% | 0.9% | 3.3% |
| Southland District | $543,973 | 0.8% | 1.1% | 5.7% |
| Gore District | $416,472 | -0.2% | -0.1% | 2.7% |
| Invercargill City | $465,300 | -0.5% | -0.4% | 4.6% |
153 Comments
“May come to end soon”
Yes, well that would be a lovely RE industry fairytale wouldn’t it.
Seems that cocaine stimulus just doesn’t hit the way it used to….
It’s 6am and everybody is booking their Ubers while the greasy haired RE guy with pupils the size of saucers in the corner continues on his own, not realising the house is a mess and there’s nobody left at the party..
Auckland damn close to my -10% prediction and a month to go
Good prediction, you must be pretty close!
Good on ya .
The scroll is seldom wrong
The int.co community would like to offer you the opportunity to revise it down even further.
Looks like even Tony the comb has left the party in an Uber:
9 months in a row makes a trend
He's leaving town with his pants down
Made me laugh.
A big drop in the OCR - for that is what our hopeless RB has engineered - will result in a pick up in summer prices. I can hear the spruikers crowing about how well they've called it.
But property investment - done well - is a much longer term game.
Tony will be wrong this summer as foolish 'investors' rush out and fill their boots.
After that? Who knows. A broken clock is right twice a day.
Let’s see what impact slashing interest rates has on house prices ……
TTP
I am watching and see no impact yet...
The impact will be only very minor support for prices until the OCR is lower than 3.5 - around mid 2025
Yes when (if) 4.99% 1 year mortgage arrives housing sales will take off. But on the other side of the coin, owning a house these days has big ongoing costs. And the risk of a capital gains tax in 2 or 5 years. Time will tell.
Yeah I'm sure another 0.5 to 0.8 percent drop in interest rates by the end of 2025 will make a world of difference.
/endsarcasm
Lots of pent up supply
Agree..
And lots of pent up fools trying to spruik up the market as well
Yes, and DTI limits are beginning to kick in, which will keep a lid on things going forward.
A good news story to start the day, fantastic.
There'll be a few trying to spoil it for you..
May they lie by the wayside
(. )
Still crashing.
What will the spruikers use as the reason why it's going to stop crashing? Even chief spruiker Tony is acknowledging immigration is trending down, employment will get worse and interest rate falls haven't been the defibrillator they expected.
Geez.. Mr. TA is now copying our lines
More drops to come definitely, then I imagine it will plateau, then after that it’ll rise…almost as if it’s cyclical 🤔🤦🏻♂️😂
Good to see prices correct, with the state of the economy I still think they’ll use housing & construction to try & pull it back from the trouble we’re in so in a year it’ll be the other sides time to party. Hopefully I’m wrong & the govt chip in with some fiscal stimulus but I’m doubtful, they’ve f*^ked it pretty good.
Genuine question. What will building houses produce for the country other than debt? ie how will it pull the economy out of the slump we're in by taking on debt to build non-productive buildings? I get that the stimulus might help bring back confidence in the market to get money circulating again but surely it's got to have some productive foundation so that we don't end up in a high housing debt environment that we're currently in where we continue to bleed money as a country.
It will simply bring more houses. We don’t have enough of them. Buyers will save hundreds of thousands of dollars which will be deployed into actual productive parts of the economy.
Likewise, building more houses will also keep a lid on rising rents leaving renters with more disposable income to spend in the economy.
@Snow, effectively it does exactly what you've said, and it will land us (potentially) back in the same (or worse) position over the longer term. But, over the shorter term it creates new money through that debt, that money pumps back into the economy, wealth effect kicks and so on and so on...in a few years we're waffling on about our rockstar economy so migration kicks up again because NZ is a place people want to be, then a while after that your neighbours at the BBQ will be telling you to buy property because their cousin/workmate/uncle made a killing, you won't be able to get a tradie (or new Ranger/Stabi) for love nor money...then not too long after the "mate, you can't go wrong with property" stage it spikes with the FOMO hitting real hard, suddenly it'll overheat and sh*t itself again...I can't see the cycle not repeating...yep, this time might be different...but, I think the can will be kicked again...as JFoe and CONF have pointed out there is still the capacity there to ramp up the debt. Is it a wonderful idea, nope. Does it work, yep (well, nope, but yep 🤣).
During the GFC the entire world co-ordinated simultaneous stimulos and record low OCR, now we have open cold war... the next cycle will not look last past cycles.
Maybe @ITG, but boom/bust has been kicking around well before the GFC, hey, who knows...not me, maybe not you too...we can all guess. I just think they'll try to get the wheel turning, and they'll probably choose the sh*tty lazy way of doing that.
"During the GFC the entire world co-ordinated simultaneous stimulos and record low OCR..."
Um. No.
No major central banks went so low with their central bank rate while at the same opening the floodgates to rampant (rapacious) property speculation. NZ is 100% unique in that regard.
Might I suggest you stop giving the RBNZ a 'get out of jail free' card?
Just stop the debt going into EXISTING HOUSES ... and Bob's your uncle. (And we'd be world leading.)
Alas, So Sorry. Never going happen under this government or current RBNZ leadership.
Where's Zwifter, Safeashouses, Rookieinvestor? Wingman has flown the coop a while back too.
You left out the main man.. 5he ICEMAN
They are huddled together consoling each other..
Read comments now and again, thanks for your concern. Smarter to avoid conversations with people who consider themselves smart like retired poppy who have term deposits as investments. Yea - that’s not my crowd.
i wonder how many of you have been to open homes recently. The falls are literally in the 0.3 % range and you muppets are still celebrating. The end is nigh for you pessimists. Falls have just about abated.
😂🤣 Notice how it's my pseudonym Iceman mentions first, that's funny!l And all I am is an anonymous poster.
"Do you know how many people have viewed my still to be sold vehicle? You better buy it now because it will sell any time now!!!"
Ah yes, says the people that have never bought anything because it “may go down tomorrow bro” In the interim, let’s just jump up and down at every headline on here daily like little girls, because that’s what anyone who’s “ made it” does right?
Tell me you are a not financially successful without telling me you’re not.
‘Tell me you are a not financially successful without telling me you’re not’
Anyone really financially successful (which I’m not claiming to be but you appear to be) wouldn’t get into childish arguments on an online forum such as this.
Are you so highly successful that you spend your time getting riled up on this forum by a guy who owns term deposits instead of rental properties?
Iceman just feels inadequate in real life, so presents an idealized version of himself to seek validation from and assert dominance over a bunch of strangers on the internet.
Just leave him be, it's not really hurting anyone.
He’s hurting himself but cannot see it yet.
That’s the reason I said I don’t comment on here often, it’s been months since my last comment.
Do like to call you DGM muppets out sometimes though. I do read your comments often on here and laugh at how small minded you lot are. “Ohh the market is dropping or ohhh down down she goes, lower for longer” Jesus, get real lives.
The real point of consideration or self reflection would be to ask oneself ‘why do these views trigger uncomfortable emotions within myself’. If you answer this, you may get to know yourself better and grow as an individual (including seeing these issues from multiple perspectives - not just the one that is beneficial to oneself and then needing to call the opposing view small minded doom merchants etc).
The greatest foe one will ever have to face is themself
Yes it's a bit depressing coming on here and reading that the DGM's are celebrating their failures, still that's society these days we keep lowering the bar. Wouldn't bash anyone with a big TD that already owns a mortgage free house however, it's working just fine for me.
On the contrary, I think the DGM's comments actually give hope to those who want to buy a home or get into real estate investing. it's not depressing.
Strangely enough, it's also not depressing to me - and I am a real estate investor, and might be in a similar position as you by the sounds of it (mortgage-free and have some TDs too)
The DGM's on here don't buy houses, however thousands of FHB that are not on here do every month. If the FHB took their advice they would be doomed so not sure how they are giving them "Hope". Sure glad I found this site AFTER buying a house and had finished paying it off.
Is this seriously the best response you can come up with Zwifter? The true DGM are the ones spreading fear that August 2023 then August 2024 and now Dec 31 being the last chance to buy a house. Under your previous account "Houseworks" you were doing the same thing in 2021. I suspect come 01-March 2025, only then will you finally stop.
Lets conveniently cast aside the inventory overhang, rising unemployment and business liquidations shall we. Mystery has hit the nail on the head.
Come on guys, let’s not forget the importance of DGMs in the market. Imagine if everyone owned their own home and no one rented, the balance would collapse.
It’s all about the interplay of positives and negatives. Let’s take a moment to appreciate the role DGMs play in keeping the system running. 🫡
Where does this narrative come from that so called DGMs don't own houses? My guess is that most of them do, they're just not self centred.
It’s import that anyone who may impact the market narrative in a negative manner gets silenced as a loser who rents…unless you hadn’t figured this out already.
Remember the highest position in modern society from a financial and moral standpoint is the person who owns the most real estate wealth…regardless of what getting to this position does to your character (sarc). As Jesus said ‘what is it to gain the whole world but lose your own soul’ or translated into todays NZ form ‘what is it to own 5 rentals but to be left so insecure and vulnerable you resort to calling your fellow citizens doom gloom merchants because you are terrified they might be right’.
"Imagine if everyone owned their own home and no one rented, the balance would collapse."
Novel economic theory. Please explain further.
But you’re assuming all DGM’s don’t own this depreciating asset like yourself, when in fact many do or sold at the top….
Sorry you’re a bag holder, not everyone can be a winner.
DGM's are celebrating their failures .... what does that even mean?
Those Spruiking roosters have been well and truly plucked of their funds........poor sods. Pray for them and the next Ponzi defibrillation, to bring the crazy Ponzi party back to life......cause she's as dead and doorknob out there!
Wingman was very confident of his wife's canny ability to pick great investment opportunities. Now, checking in on reality: Riverhead prices have continued falling since June
not his though, he and The man live in a haze of pipe smoke
Wingman got so confident that he got deleted. Feeling aggrieved he reincarnated as "Go woke-go-broke", then got deleted again....
Desperate Spruikers will insist on pushing the limits.
Desperate DGMs such as yourself should be deleted for the same reasons. It would be nice to have comments on here that are worth reading, not a whole lot of "I'm better than you" waffle
I'm better than you
What a ridiculous and totally desperate thing to post. I don't regard myself as superior to anyone. I will take this opportunity to suggest that those who out themselves as suffering some sort of emotional complex are responsible for seeking the appropriate treatment.
You do regard your self as exactly that. Then again I ask myself what does a 50 year old do spending so much time DAILY on the comments forum here jumping up and down like a little girl.
Get a life.
by Iceman | 5th Dec 24, 9:36am - Smarter to avoid conversations with people who consider themselves smart like retired poppy
Does this mean Iceman not so smart now? Evidence suggests you're struggling to control yourself - becoming too emotional.
Retarded Poopy - my last comment was months ago. I love to laugh at your moronic takes though. How are the TDs doing?
I think anyone who calls someone else a DGM or a spruiker is childish and foolish. But am I superior in reasoning or thought to either of the other parties?
As Jesus said we will be judged by how we judge. If you call anyone a derogatory term (spruiker or DGM) you cannot them claim the other party view themselves as being superior to yourself as you have already committed the same sin and by default become a hypocrite. You are seeing the speck in the other man’s eye but not the log in your own.
This whole comment section is full of this same moral error.
Unlikely.
Wingman and "Go woke-go-broke" each had their own myopic versions of being foolish. IMO, they didn't overlap much. Ergo, different people (or the same bot).
So what’s going to propel the 7% growth the RBNZ forecast for 2025? Net migration is about to turn negative and the redundancies are still playing out. Businesses as still going bust at high rates. No stimulus from Fiscal Policy. What else am I missing?
Interest rates still being restrictive.. (JH)
Agreed.
The RBNZ seems to believe that restrictive interest rates for over a year will somehow help NZ Inc accelerate away into obscene amounts of economic growth now they've just cut a few times but interest rates still remain restrictive.
What gives? Can we see the economic texts they're working from?
Or is it - as I suspect - they've come up with some new 'economic theory' and they're using NZ as a guinea pig to test it?
(Yes, P. I'm looking at you.)
7% is too high.
But if the OCR is cut to 2.5%, as it should be and probably will be, there is likely to be an uptick in prices in Spring 2025.
Before then - flattish
7% is nonsense without a stimulus package or credit expansion. An OCR that’s still restrictive won’t be enough. You can see the investor % increasing on FHB again but that’s not playing through to increasing prices.
"What else am I missing? " - Reduced interest rates.
Hard to know if the reduction in interest rates will have a bigger effect than those other factors you mention. My personal opinion is that house prices will stabilise and pick up slightly next year, but I doubt it will be 7%.
I guess that’s a fair point on reduced rates. I just don’t see it happening inside the first 12 months of the cutting cycle given the broader conditions and lagging effects. I could be wrong though.
Overseas events might really trip us up... wars, trumps trade wars, ukraine, middle east, Europe... South Korea .
The likelihood of another black swan event (think ukraine, Gaza, pandemic, weather issues from climate change, cyber attacks, terrorism) is pretty high. Let alone the potential for issues with the economies of our 2 largest trading partners.
Agreed.
But NZ's biggest risk remains an imported energy shock. By a long, long way. (But I expect you already know that.)
So remind me ... Why isn't this government - like the last 30 years of governments in NZ - doing something about it?
(hint: billionaires get way richer with energy shocks.)
We shut down Marsden Point surely that is progress? /sarc
I concur.
At the heart of all this is that the western governments govern for reall such short terms and get so much power.we have no way to implement a long term vision, we end up with populist policies and allow billionaires and corporates immense power over policy making.
Stuff like climate change policies, economic strategies, tax, super, permissable debt levels, infrastructure strategy, energy strategy, housing, climate strategy... all needs to be removed from short term government control and handed to some form of elected independent body like rbnz for finance with 10, 30 and 50 year plans decided by referendums...
Govt would be left with more operational control, crisis management and a means to implement policies that have to support the strategic goals nz needs and wants.
I'd have to disagree with some of this statement
"November's results indicate a market that's still in a holding pattern - not falling to any significant extent but not rising emphatically either," CoreLogic Chief Property Economist Kelvin Davidson said.
Holding pattern? more like sustained price decreases
not falling to any significant extent? - if you say so
not rising emphatically either - you got that right
When it's this bad, Big Housing, just have to spin a dream-based case, to keep the spruikers hooked.
Then, when it gets worse- The powerful, all seeing, Eye Of Sauren REA Industrial Complex, has to simply lie in the face of the bad and increasingly negative stats.
Yes, he’s a spruiker
anyhoo, I for one only really put stock in the HPI
I would prefer raw data.... the like for like us index is interesting same house sales compared over time
“The Man” reads the figures where he is, and can only see prices rising?
There have been some good buying opportunities and have taken them.
As I have said before many times, despite the media the housing market is more than Auckland thst we all know was over valued due to immigration mainly.
I feel like The Man may need to get his glaucoma checked. The amount of new listings coming onto the beloved Christchurch market is accelerating vs sales. I don’t have the business acumen of the man however I believe that implies prices aren’t going anywhere - leaving ROI,which is already 💩, looking even even worse as time goes by.
I've been looking at Christchurch for a while. Properties were sitting on the market for months prior to August (while going from auction to deadline to offers above to fixed price). Since the interest rates started dropping there's firmer prices for good residential properties in good areas. As you say now a noticeably increasing volume on the market.
Prices don’t work like that. You can’t just isolate one segment of the market. The CBD townhouses drag down the prices of the villa in Fendalton.
I’m following the market too and would disagree. Prices are firm nowhere.
I am only interested in a specific market segment & ignore ChCh CBD townhouses. My comment was unrelated to them ("good residential properties in good areas")
I'll give him one thing though, as AKL continues to have a steady stream of folk deciding to leave the big smoke and up sticks elsewhere, tey often look to Wellington or Christchurch, and Christchurch is better value than Wellington.
As I have said many times we are currently not buying property to rent out, as the return is too low.
The successful investor have changed tact and are now buying at unders and improving, that is where the money is now
Nothing wrong with my eyes had them checked very recently and all good there.
Prices in ChCh have not fallen and existing homes on sections are very sought after.
have changed tact
"Tack" - it's a sailing metaphor.
Why do you refer to yourself in the third person?
Are the Man 1, 2 and 3 figments of your imagination?
Figments of imagination? Last time I checked I was still here!
Not sure I refer myself as a third person?
What Interest.co actually needs is more people encouraging others to improve their financial position and not having the same sad sacks every day saying house prices are dropping!
I can understand the frustration of not being in s position to afford to purchase a home to live in but what have you done to change that?
Property to some people is a vehicle to financial freedom and to others just a roof over your head to live in.
You will find it very difficult to change a property enthusiasts opinion when they have achieved so much from investing In property!
Oh this is amusing.
Mommy, these sad sacks aren’t pumping my favourite asset class anymore and keep stating that house prices are dropping!
Many of us own property, sold near the peak, or dare I say it, run a successful business. (An actual business)
Nice try though, I’d say the smart ones are those not currently over leveraged or bag holding depreciating assets unless they primarily live in them.
If you want to help people make smart financial decisions as you claim, you wouldn’t hold the conveniently beneficial positions you do…..
No one that owns property or investors need people on here promoting property as the right thing to do!
What I will say is that it would be beneficial to actually take advice from the ones that actually do promote property, and to be fair most of them do that on here to try and help the people that aren’t!
At the end of the day we mostly choose what direction in life we take and that is what affects whether we are financially independent or financially broke,
If the many on Interest.co feel that they are better off staying away from putting money into property then that is solely their choice and is a positive for investors as they will buy cheaper without the competition and always have more tenants to choose from.
I choose property over anything else that others choose due to having the control which you do have with property and the ability to buy without having to pay any money up front.
"the ability to buy without having to pay any money up front"
Equity release / deposit recycling is a popular form of financing for non owner occupier buyers. This is effectively 100% LVR (i.e. 0% new cash savings required). This is one reason that non owner occupiers are able to outbid owner occupier buyers in the existing dwelling market. The current policies of the current government have given non owner occupier buyers an additional buying advantage over owner occupier buyers in the existing dwelling market, enabling non owner occupier buyers to outbid owner occupier buyers in the existing dwelling market.
"If the many on Interest.co feel that they are better off staying away from putting money into property then that is solely their choice"
For investors who invest in multiple asset classes, at some price level in the residential real estate market (i.e lower prices) it will be attractive to invest in residential real estate. At current price levels in most residential real estate markets in NZ, most of the returns are heavily reliant upon speculation in capital gains.
At current prices, there are better returns available elsewhere than is currently available in most residential real estate markets in NZ for investors who invest in different asset classes (and do not want to get into the real estate business - e.g buy, renovate, sell / rent out as long term rental / Airbnb, etc). Having previously owned residential real estate in NZ, the capital has since been invested elsewhere with higher returns.
Wrong thread.
Rates, insurance increasing, R&M required on so many of these dog rentals and good tenants getting pickier and hardy to find....a recipe for ongoing and bigger drops.
The asset has become a liability. The Briscoes of all housing sales just around the corner.
Wow people are getting excited about median value reporting... wasn't HPI the gold metric that many here only took notice of? I guess not when it comes to price drops... what's next, averages?
Exactly. Whatever the direction, I put by far the most stock in the HPI
The HPI is the gold standard.
At this rate I will have to give up my name in a years time..
Thanks to Nifty, I'll change it to 'WorthBeingADreamer'
Go back to sleep HO, sweet dreams...
I can see the tears of blood running down your face..
You might be the one needing to sleep..
Sounds like you might be having a nightmare Dreamer...Take it easy, everything will be OK- your landlord has got your back, if not you'll find another whilst waiting the rest of your life for house prices to become, what you deem, affordable.
Are you dream talking, Boomer?
So will this become like the 70s? I.e. a 10+ year flatline with prices going backwards in inflation adjusted terms?
The situation is very similar. I.e. massive zoning and intensification changes together with a supply boom.
By golly. I think it will be. (As I've saying for a very long time now.)
So forget those un-taxed capital gains unless you bought 15+ years ago. And let's not forget a CGT is inevitable.
So in a nutshell ... FHBs and OOs are in for a good time. 'Investors' would be muggles to buy anything that isn't cashflow positive with a decent NET yield from the very first day of taking ownership.
Here's hoping
Good post.
But, re the ‘supply boom’, do you think we will see more of it (ie. what we saw from ‘21-‘24)?
I don’t see it, other than perhaps some upticks when the OCR is periodically low (2.5% or less)
Throw in a decline in migration, and mid to high rates for the next decade, and it goes from stagnation to a rolling crash.
Good post. Sure, not exactly the same, but plenty of similarities as far as the housing market is concerned. (What a shame NZ Inc didn't start electrifying our economy then, ay? I guess the fools in charge thought those energy shocks would be 'one-off', ay?)
JFoe has been great at demonstrating this through a series of posts. I see an external energy/commodity shock as our biggest risk as we have little protection against it. What’s worse is the type of shock could just be a secondary effect of a much larger shock. Anything that could reverse the imported deflation we rely on will have a massive impact as most households cashflow is being squeezed by general living costs.
Long story short, North Island down, South Island (mostly) up.
Yep the real estate prices and economy picks up in the deep south first and works its way up the country - sorry Auckland, you'll have to wait a while
If you've been around the country for a while you'll know thats how it works as we are more dependent on the primary sector than many would like to believe
Red Meat
Farm profit is forecast to decrease 7.4% — to an average $45,200 per farm. While we expect a small increase in revenue, this is offset by higher increases in expenditure.
new-season-outlook-2024-25.pdf
Dairy
The operating profit of $3017 per hectare in 2022-2023 was down 27% on the previous season, a consequence of lower gross farm revenue, down 8%, and higher operating expenses, up 3%, DairyNZ said
Dairy farm owners take a hit in operating profit as economic crunch bites: new survey - NZ Herald
using dairy reporting from June is a bit out of date, don't you think?
This. The North Island is holding the country back, as usual
It took a pandemic and the highest negative real interest rates since the OCR was introduced in 1999 for asset prices to inflate significantly. We are in a different regime now. We rarely have seen positive real interest rates like this since the GFC. Keep an eye on unemployment and liquidations. Mute the noise. Resistance is futile
That’s basically every 10 years my friend. While I don’t vehemently believe that it doubles every 10 years - mostly the larger gains happen every decade.
Try searching the real interest rate in NZ since 1987 and you'll see it has slowly decreased over 30 years. We would have had a recession much worse in 2008 without QE which effectively masked the level of debt build up in the system and offloaded large volumes of private debt onto governments via bailouts. The next 10 years won't be like the last, and sadly if it is then we will be in for some serious pain down the line when the core issue needs to be addressed. Then again if there's any major disruption via global conflict or oil price shock then we are going to feel it. How could the price of housing hold up when nobody can afford higher food and transport costs, risk weightings are higher by banks and businesses keep folding?
North Shore up.
Rodney where I am is up... no downturn in my piece of dirt...
Shhsh HouseMouse will get angry at you talking about the Shore...
Have your sales picked up?
Passed in today for $1.92m. That could be another six figure ouchie. Poor people. I blame the RBNZ first and foremost with spruikers a distant second.
https://homes.co.nz/address/auckland/hillsborough/38b-olsen-avenue/1GJBq
Surprised they got $1.92m for it!
Absolute shocker for a box design like that, still that's Auckland for you and it has 6 bedrooms and is 300sqm floor area on a section smaller than my 3 bedroom.
A large portion of blame needs to go on themselves... what a stupid buy. Hillsborough for that money... come on.
468m of land in Hillsborough with no view. Worth about $700k?
A fairly substantial house, slightly dated now. About 800k to build new?
So even $1.92 seems about $420k too high.
"About 800k to build new?"
JJ, Your maths needs a tonne of work ... Try harder.
301sqm @ $3,500 per SQM = $1,053,500
The fit-out looks about average but even then $3,500 per sqm would be hard to achieve.
I really don't get per SQM costings. There are big fixed costs like services and kitchens, and much smaller per metre costs like garages. Whacking 100m2 of extra bedrooms / lounges / garage onto a 200m2 home should not increase the cost by 50%.
301sqm @ $3,500 per SQM = $1,053,500
The fit-out looks about average but even then $3,500 per sqm would be hard to achieve.
So implied land cost could estimated to be $1,851 per sq m for Mt Roskill / Hillsborough?
1) Sale price: $1,920,000
2) estimated construction replacement cost: $1,053,500 (301 sq mt @ $3,500 per sq mt as above)
3) implied land cost: $866,500 for 468 sq mt of land (implied cost per sq mt of land is $1,851 per sq mt, or $7,492,737 per acre)
Interesting to note the 2021 CV, valuation of land is $1,090,000 which implies $2,329 per sq mt or $9,425,356 per acre.
If the 2021 CV valuation of $1,090,000 is used as the market value of the land, and the $1,053,500 construction cost, then the current total replacement cost would be $2,143,500.
So the sale price of $1,920,000 would be 10% below the current replacement cost of $2,143,500.
A commonly held belief is that the selling prices of dwellings do not fall below their construction cost, yet the vendor was willing to accept a price that was below the current replacement cost. Most vendor's don't care about construction cost or replacement cost when selling (only builders and developers as they are profit motivated), as they may be willing to accept the highest offer that they receive (look at the number of vendors who are willing to sell at a loss compared to their purchase price in the last 2 years https://www.interest.co.nz/property/130711/almost-13-auckland-residenti…) .
Buyer's may not care about construction cost or replacement cost when they are looking to buy.
"468m of land in Hillsborough with no view. Worth about $700k?"
That $700,000 implies $1,495 per sq m of land (or $6,052,981 per acre)
Is that the current market value of land in that area? If not, how did you arrive at $1,495 per sq m?
Harsh. And quite unfair IMO.
Last sold for 2.3M?
Yup. $2,298,500 in December 21.
Below even the lowest end of the homes.co.nz range. That site is just hopium for sellers.
"That site is just hopium for sellers"
That site has valuations that can be "influenced" by those with vested financial self interests. Noted several times for properties listed for sale that there was a significant upward adjustment in valuation estimates on the site just before the property was listed for sale.
https://www.stuff.co.nz/business/127537672/homesconz-criticised-for-all…
Values on Homes are 20% overpriced at a minimum.
The algorithm is designed to exclude 'outliers' that result in significantly lower prices than the estimate.
REA only upload the good prices achieved so when the algorithm runs last months prices it only has the best ones.
If prices are uploaded later they are excluded from the calculations so low prices are never factored in.
You can see some of this play out when a house is sold for less than the lowest estimate, even then the estimate is not updated.
It's a marketing tool for REA nothing more.
It’s a scam and I can’t believe that it is even allowed to exist.
Actually I can believe it, in this mickey mouse, housing-ponzi loving little islet
Homes is all over the place, for my place its too low. I'm not sure what metrics they use but when you do finally actually sell, the price on homes magically becomes the sale price and then begins to trend from there. Four or five years later its out of whack again.
"That's another six figure ouchie."
Expect more to come in Auckland in the recently released Watercare red-zone areas. Some properties will not be able to be developed for a longer than expected period of time - landbankers and developers got caught out.
When you add those red-zoned areas to the large areas - Tamaki, Mt Roskill, Whenuapai, Wrstgate, Manurewa - that are seeing big increases in development contributions, it’s quite a large chunk of Auckland. Certainly will have an impact on land values, as well as the amount of new housing development occurring over coming years
Add Orewa and Whangaporoa....
maybe it is almost about time to do my sub division and title.. as we have own waters.
"as we have own waters"
A LOL moment. Or put another way, "sure you do". I.e. potable? To council standards? And disposal? Must be a huge subdivision to justify those costs.
It still says PassedIn at today's auction?
Yes. My bad. Corrected. (Got my links crossed again.)
Wow. Hillsborough is being smashed in prices. Just looked at all the stock sold near that house.. some properties sold for half their 2022 homes 'valuations'.
On the other hand, having lived in the area and knowing who the local realtors were, I'm suspicious there were significant upwards manipulation of those 'values' prior to 2022...
@Chasoinflesh
Didn't your previous rental sell below your landlord's 2015 purchase price?
What was the address of that property?
I don't know what they sold for. I know homes has it down approx. 1 million from peak, below their purchase price, and sold at TBC.
I'm not going to give the address, and if you find it please don't link it (nor will I confirm if correct).
We had strong suspicions they were in financial crap: constant mail from the bank after their 2y refix [and Zwifter, you don't need to open rain-soaked mail to see it's contents]; always whinging about interest deductibility; and finally, their failed attempt to claim our bond for themselves.
Provided the sale resolves, then at least they will have freed themselves of that millstone around their neck (assuming no debt hangover).
"constant mail from the bank after their 2y refix"
Seems that they might be in cashflow stress. Their lender may have been willing to give them time for their circumstances to improve (e.g interest only) and if the circumstances didn't improve or the loan balance grew too big, then the lender may have given them a deadline to sell before initiating a mortgagee sale.
I must be the only one that thinks this is a bloody good sales price! Only 16% drop from the previous sale which was pretty much at peak, and some of that would be the normal depreciation of a new build (it's not so shiny and modern now).
BTC just hit $100k...how ironic the interest team are out of the office!!!
North of the Bombays starting too reveal its self ... and at a casual glance some of the regions that were considered value buys (possibly by those fleeing Auckland) are showing signs of trending down . So many negatives ,few positives in the data . I am doubtful that low mortgage rates can turn it swiftly ... FOMO drove it too a brick wall in my opinion and those keen on making a quick buck envisioned an eternal climb to the top of the totem pole at the expense of the underdog . Problem now is even the underdog has nothing left to surrender due to the austerity drive thrown down from above.... Stock levels high , prices still not where they need to be for the upstarts.... Media , Agents and Financiers pushing for one last surge but the average consumer is treading water just to see themselves into the next week. Maybe the suits need to wake up and smell the coffee , all is not well in the land of milk and honey and sadly that abundant life is still out of reach and its gonna take more than dangling a carrot here and there to restore balance to the economy .... wait... road tolls will solve it...."It's a long way to the top (If you wanna rock n' roll)" ACDC ....
I'd like to understand how Tony Alexander can claim prices are rising??
I think he ambiguously and intentionally said the "market" is rising.....which could be inferred as prices and/or activity, number of listings...
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