This year may be shaping up as the mother of all buyers' markets for residential property.
There are two sets of figures pointing to the market being particularly weak at the start of 2025.
The first is the overhang of unsold stock at the end of 2024.
The overhang is the number of properties listed for sale at the start of a month, plus new listings received during the month, less the number of properties sold during the month.
It represents the number of properties unsold at the end of each month either still to be sold or that are withdrawn from the market.
Interest.co.nz estimates there was an overhang of 28,466 residential properties at the end of December last year, compared to 5518 sales reported by the Real Estate Institute of New Zealand (REINZ) for the same month.
December's overhang was 24.5% higher than it was in December 2023, and the highest it has been for any month of the year since May 2015.
However, in May 2015 the REINZ reported 7952 sales, 44.1% higher than the 5518 sales reported in December last year, so the market was much better placed to cope with the high overhang of properties back then.
Also by way of comparison, the overhang in December 2019, just before the Covid pandemic took hold, was 15,506 properties, meaning it has increased by 83.6% since then.
And of course a big overhang of unsold properties works in buyers' favour, ensuring they have plenty of choice.
The second set of data suggesting the market remains weak as it heads into 2025 is the high number of properties being withdrawn from sale.
Interest.co.nz estimates 3755 residential properties were withdrawn from sale in December 2024, up 43.5% compared to December 2023.
It is estimated that in the whole of 2024, 33,368 properties were withdrawn from sale, up 24.3% from 2023.
Properties can be withdrawn from sale for many reasons, but the most likely reason is vendors could not achieve the price they were hoping for and were not prepared to meet the market.
That in turn suggests buyers remain cautious on price and are prepared walk away from a deal if the vendor is being, in their view, unrealistic on price.
So 2025 is shaping up as an interesting year for residential real estate, but it's likely buyers will still have the whip hand and will continue to negotiate hard on price.
Their reasoning is probably something along the lines of there's plenty more fish in the sea, if they believe a property is over priced.
Although the properties withdrawn from sale have been taken off the market, they represent a latent supply of properties for sale ready to come back on to the market. That's because the reasons their owners wanted to sell probably haven't changed much.
Those vendors probably still want to sell, it's just a question of when, and what might force them to meet the market.
The comment stream on this story is now closed.
128 Comments
If the buyers have the rare opportunity of having the whip, might as well use it to the full extent.. on the vendors till they accept the reality of the market conditions
Gee Greg! Talk about throwing a grenade in the comments section. I predict 150+ comments
Don't worry it'll be 30 comments come March!
We'll need all the comment stimulus we can get.
What's happening in March?
You have to pay to comment here from 1 March which (while I don't mind doing it myself) I think is a poor financial decision.
It's not without cost to provide, maintain and monitor the platform. How much?
I think its the $100 a year green tick membership
If contributors drop-off because of $2 p/w, maybe that's a positive?
surely it will have a substantial impact on the ad revenue with less activity in comment sections.
I suspect the strategy is to rely less on advertising as a paid account is ad free. Its really funny to see people mentally struggling with paying 27 cents per day. If you are that leveraged you are in big trouble.
yep, I'm running my weekly budget down to $2 per week. lol
You're basically bankrupt if you don't pay $0.000003 a second to comment on interest articles.
I don't pay to comment now, and I won't think of it as paying to comment then. It is paying to support a service that I find useful and want to continue to exist.
As a financial news platform, it's tax deductible for most of us.
People aren't subscribed because they can't afford it, that is obvious. I suspect most people will just stop commenting (maybe for the best), and as others have suggested, ad revenue will likely drop more than that additional 27 cents per day. At least you'll probably get rid of most of those pesky "DGM's" and the "sky is not falling because of Trump" types.
Many comments are good quality reflecting the real world so iT would be a shame and loss if payment to comment loses those insights, understand the cost pressures and advertising revenue which much print media are discovering is a failed business model, if non biased and truthful investigative and factualy based reporting results its just possible print media will survive.
Don't mind
Need to improve user experience
Notifications for when comments are responded
spelling auto correct - for some reason cannot do it on this site
scrolling down to comments - not working well
It will probably work out just fine as there are far more DGM's on here and they will continue to need to have a place to rant. The people that are happy and are sick of the DGM's not listening to any financial advice anyway will exit stage left.
Clearly not on here enough - but what’s a DGM?
People that accurate predicted that many buyers who rushed in to buy back in 2021 and were paying too much were behaving like fools and could well come to regret that decision. And anyone who thinks home affordability might improve in the future = doom and gloom (merchant). Because cheaper housing and improved prosperity for future generations is a complete nightmare scenario.
The true DGM are those who constantly name call other people DGM. It’s like the guy pointing out the spec in another’s eye while not seeing the log in his own. And as much as one says hey you’ve got a log in your eye they will say ‘it’s impossible for you to ever be correct because your views are negative and not excessively optimistic’ (even though they may be realistic and turn out to be true). I’ve found people living in denial the last few years are the most likely to call others DGMs. ‘I don’t have a log in my eye even though I can’t see out one eye and I’m in considerable pain - it is impossible that you might be correct about this or anything’
DGM = Don't get mad.
because I'm going to try and make you mad, whether i think i'm right or not.
No, DGM = Doom and Gloom Merchant doesn't it?
Debt Gathering Middleman....aka specuvestor
DGM
- Didn't Get Manipulated (by those with their vested self serving financial interests)?
- Didn't Get Mortgaged (to the hilt)?
This
DGM = Didnt Get Misguided
Lets wait and see the change in house prices over the next 12-24-36 months :)
Just because house prices went up over one historical period or a set of periods - itoes not necessarily predict the house price change for the next period(s). Smart thinkers will look at the external influences and their likelihood - and then how to assemble the optimum investment strategy - which might or might not include housing - for me not.
Look at the outcomes for Kodak, Nokia, now the whole traditional Automotive manufacturing Industry. Their past was definitely not indicative of their future.
‘because I'm going to try and make you mad, whether i think i'm right or not’
So basically the definition of an online troll
"those who constantly name call other people DGM"
Those choosing to name call others with negative labels had some or all of the following attributes:
1) had undisclosed vested self serving financial interests seeking to discredit those commenters seeking to give warnings of extremely elevated house price risks
2) were unable to counter the valid points raised by those giving warnings of extremely elevated house price risks
3) believed that residential dwelling prices do not go down by much due to their personal experience and over 50 years of residential house price history in NZ
4) believed that residential dwellings are an investment where owners cannot lose
5) owned real estate which distorted the lens which they viewed house price risks and caused cognitive dissonance
6) unable to recognise a real estate market mania
7) engaged in bullying behaviour to the point of tribalism which impaired their cognition
These name callers were choosing to play the man and not the ball.
All of the above. Kinda highlights the very ingrained expectation of endless capital gain at the expense of everyone else.
Expectation / Entitlement Mentality
"The true DGM are those who constantly name call other people DGM"
What about the commenter who calls himself "DGM", LOL. (see the very first comment).
Because cheaper housing and improved prosperity for future generations is a complete nightmare scenario.
why do people keeping banging on and on about this if they believe this will be the case
Just like tomorrow is not promised , we just dont know
DGM = Disenfranchised General Masses
Here's some of Zwifter's self-proclaimed "financial advice"
---
by Zwifter | 14th Jul 24, 12:30pm
The whole economy is based on peoples state of mind, just drop the OCR its that simple, people will begin spending money again. Lets come back in August, if the rate drops 25bps you have your answer, it could even be a shock drop of 50bps by then.
---
by Zwifter | 14th Jul 24, 11:32am
The falls are already over, this is it. All the RBNZ needs to do is take 1% off rates and the housing market will turn. The whole of NZ runs on the state of the housing market, with prices going up people spend more money as they feel good. Watch for a lift in the market before Christmas.
---
by Zwifter | 11th Aug 24, 9:56am
The crash is well and truly over. Prices will start to rise, probably rising already now banks are dropping rates. This Wednesday could see the confirmation in the halt of price declines. The OCR should be cut. Homes has my place at a low back in July, its been going up since then.
---
by Zwifter | 12th Oct 24, 1:05pm
Nothing but SOLD signs in Tauranga, if it has not got sold on it then its coming up for auction. Like I said a week ago the market will turn on a dime. If we get another 50bps cut in November, my prediction of 3 to 4% annual gains down here by Christmas is likely to pan out.
Ouch. Reality isn't Zwifters forte.
Indeed. Blinded by ponzi goggles.
I love the strategy to just keep dropping rates until the housing market turns. Then we will all spend money and live in utopia.
Genius. I don't know why we need economic courses at university.. and even an RBNZ at all.
"You have to pay to comment here from 1 March which (while I don't mind doing it myself)"
So why don't you pay to comment Toye ? Do you mean you will only pay when you are forced to ?
Because I'm afraid that this change is likely to be the end of interest.
Your comment makes no sense at all. If you pay now, as I have suggested, Interest will not be worse off. No point making it more complicated than that.
I am of the same opinion, as that is exactly what killed the Macrobusiness site in Australia.
Interesting re. paying for comments. I have to say that personally I actually visit Interest.co.nz not only because of the great articles that they write (and I agree with them trying to find ways to monetise their website), but I actually look forward to reading the comments as much as the articles themselves! The comments sometimes provide great food for thought. Monetising the comment option will take away a lot of that "comment content" away.
I concur. I fully understand that it costs to run a site like this and the complexity of revenue generation and profitability if it were me i would charge for access to reporting and comments tools which are unique to interest.co.nz and which offer value to us and which are not available for free or via ai/news channels.
That might be very interesting.
I do love interest.co.nz and am impressed with articles and comments and would love to see it thrive. However in a sustainable and engaging way.
At the moment increasingly AI is finding content and assembling answers to investment related questions based on current info very quickly and increasingly accurately. The new cheaper chinese one is frighteningly good. Thus content needs to be shielded from AI and based on offline research and data.
Great
It will get rid of some idiots who keep banging on a property crash and slanthering those who dont or hold a few investment properrties
Tall poppies put your money where your mouth is
With more interest rate cuts coming and short term mortgage rates set to drop below 5%, maybe the balance might even out. Do potential vendors wait and see how low mortgage rates go before selling, or do lower mortgage rates relieve the pressure to sell?
ANZ are forecasting a 6.0% rise in house prices this year. Might we see the return of FOMO !!
ANZ also forecasted a price increase in 2024.
How'd that work out?
Not a chance of FOMO. OCR will need to be around the 1.0% mark to move prices north of current highs.
IMO, the only way to start FOMO, is if the Government opens NZ property market to the world. With the low NZ$, this would make our market attractive to off shore investors.
Agree. Rates are going to have to be LFL to get any momentum going.
If we didn't have Winston First in the coalition this would have been happening this whole parliamentary term, with an additional 15% of the sale price going straight to the government's coffers.
Of course, this additional demand for the NZD would have also kept the NZD a bit higher, leading to lower imported inflation..
Isn't this what Luxon and Nicola said - "We will not get rich by selling to ourselves". Clearly this govt and MPs don't want their property portfolio to go down in price.
A company who's profits rely upon increasing house prices have predicted that house prices will increase, as some pathetic attempt at a self fulfilling prophecy?
Shocking
Are fewer homes going to auction this year? I checked out Greg's articles from the same period last year and am keen to hear a summary of the situation this year. Seems like a slow start (I don't mean you, Greg).
Jan 27 2024:
https://www.interest.co.nz/property/126082/overall-sales-rate-has-been-…
Jan 20 2024:
https://www.interest.co.nz/property/125985/auction-numbers-increased-la…
Buyers are negotiating and giving up or not bothering altogether.
My money is on the latter, let it fall on its arse while growing wealth elsewhere.
When yields normalise, the motivation may change…
As a prospective buyer (upgrading home) I tend to agree.
Fundamentally, it's frustrating dealing with 'incalcitrant' vendors. The property 'owes them' $X and they don't want to budge.
For example, we've seen a place where if we could it for its listed CV value, we would more than gladly make the purchase. But the vendor is sitting about $150k over CV and won't budge, so the property continues to sit.
Obviously the vendor is free to accept or reject an offer as they see fit ... but it's not like we are being greedy and saying we want 10% over CV for our place and 10% under for theirs (appreciate we'd have to sell first).
Biggest falls still to come for those homes over 1.5m
Utility beats vanity in hard times.
Warren Buffet perdicts 50-60% reduction in values in US were mortgage applications are 60% lower than a year ago, could this be a leading indicator for NZ???
Couldn't agree more,
Curious DT, I read your posts frequently and we appear to have very similar situations, both business owners, relatively high household incomes for our age range (35ish) and large deposits, more than enough to comfortably buy a nice property or two. (Sold my last house in 2018)
Do you find you have constant pressure piled on from your family or friends to join the misery?
I said to some family members I'd keep a lazy purchasing eye on property this year even though I believe it will depreciate further after purchase, but now I'm just thinking of pushing all of our cash over to a managed fund for a while. They think I'm "nuts", because I'm not playing ball.
Of course as always, evidence free anecdotal bullshit is the primary reasoning.
The funny thing is, people feel sorry for you if you're "not on the ladder" even if you could buy their dog box with change left over. I don't think the landlord likes us for this very reason, always makes comments about why we have a Tesla in the driveway but haven't purchased a house. (It's a company car and the fuel savings pay for it many times over compared to the previous S4)
I said to my wife last night, bugger this, I refuse, let's just go with a managed fund and continue renting even though we are also looking to have our second child. (Son is nearly 2 and we need 4 bedrooms, one for my office and one for the second child)
We are saving a lot of cash per month and rent is cheap without the stress our friends are dealing with. If we have to move due to some twitchy owner, so be it.
Another year or two of savings, no debt and property price destruction is fine by me.
100%
A well invested 20% deposit for a 1 million house easily pays the rent while at the same time you're not paying council rates, insurance, maintenance, etc.
Insurance and rates are effectrively included in the rent whihc makes the actaul rent for the property use less.
Ummm... no.
We owned a home in US for 20 years (paid it off in seven years via extreme saving efforts) before shifting to NZ in 2007 (we sold our house in US back in 2006 and rented for a year in US prior to our move to NZ). Looking at the numbers, we figured out that we would be better off renting instead of owning for where we were located in NZ (NOT Auckland!). In 2016, we we looked at the tea leaves, threw chicken bones, and figured out that it was time to buy (the more technically inclined might reference supply and demand data).
For nine years in NZ, we paid the rent costs for the house that we rented with returns from term deposits matching the value of the home we rented, with extra interest to pay taxes on the interest accrued on the TDs, as well as extra going in our pockets. The capital appreciation in that time period totalled less than 10 percent (total, not per year) for where we lived. The landlord paid the rates, insurance and maintenance. The landlord was subsidizing our living expenses.
Sometimes it is most prudent to be a renter, sometimes better to be an owner.
well almost all propertry snice 2016 has gone up and came down to double its 2016 value . the good thing about owning your property instead of a landlord , you can do what iveryou want to it . expand , paint , punch holes in the walls if that is your bent . Up to you .. in the last 40 years property values in NZ have gone from $6000 To 600,000 same world over in developed countries so find some where you like , buy it enjuy and put your feet up . John .
Does sound like we are in similar positions age/stage wise, however in case it wasn't clear from my post(s) we already own a house.
Purchased in 2019,. Timing wise we were just lucky to get in before prices ramped up post-Covid (if I recall, there were some brief mentions of a strange illness in China the day we signed the paperwork!). In hindsight wish we had bought a bigger place at the time as I'd have zero interest in property searching if we had even one extra room on the house and a bit more outdoor space for the dog and kid, but then again in hindsight I wish I had bought Nvidia shares when some colleague was shilling them to me several years ago!
So in terms of pressure, it's not the same situation as you (as you presumably had a property, sold it, and are now renting).
I'm also lucky insomuch that my parents aren't big property enthusiasts. They actually own a mix of commercial and residential property but it was all purchased yonks ago, none of it is rented out (it's used for family or business purposes) and they instilled into me from a young age that there are alternatives to property - such as shares, developing monetisable skills for a business, even crypto was a family dinnertime topic relatively early in the piece.
My wife's family is a bit different as her parents are very much of the view you always need to be looking to 'leverage', or 'add value' and that property is a one way bet and the be-all and end-all of investing and building wealth (even though they have managed to do rather poorly on some previous purchases). We are wary not to be too boastful of our ultimately good financial position (especially as none of the other family members of similar age to us are doing that well) but the in-laws have a sense we do alright, so tend to ask why we aren't looking at acquiring IPs etc. I just smile and nod, they are good people just a product of their generation, upbringing and network of friends who are all big into property investing too.
We are in the same second child position (just found out not too long ago, was a little unplanned tbh) and that is spurring the need to look at alternative options.
My fundamental whinge at the moment is it is ever so frustrating seeing a variety of properties which - if the vendors would be even 10-15% more realistic - would be a perfect fit and a modest step-up in terms of debt but where that step-up yields a commensurate in amenity. The problem is vendors don't seem willing to meet the market.
I'm in a similar position - can afford to buy no problem and will have little or no mortgage but I don't have any desperate need or desire too unless I see a place that I really like and it isn't completely over-priced. I fundamentally have an issue with the value aspect - a pretty average house for $1 million dollars....it is just an utter rort.
I'm surprised more FHB haven't cottoned on to this TBH. Many are paying double or more in home ownership costs than rent but they don't seem to realise their equity is not increasing. Many are on higher interest rates as less than 20% deposit and surprised paying an extra $100pw doesn't get them from 10% equity to 20% equity in a year. How long are FHB going to keep propping up the market when they realise the "dream" is not quite that and the fundamentals of home ownership being the path to financial freedom have changed.
It may also be that people can rent in a nicer/more convenient suburb than they can afford to buy in which makes quality of life better while they continue saving for wherever it is they want to invest their money in. With the tide turning to more rental supply, along with flat house prices it should also be a lot less likely that tenants are moved on because owners are selling for capital gains.
Definitely at the high end. I saw a place on the market for $3 mil that said it was renting at $1k a week. The interest alone is 3x that.
That's what I've done actually. Can't bring myself to pay inflated prices for a home in the area, so taken cash from sale (bought in better times) and plonked into better investments, easily offsetting the rent, until the market comes to its senses
I've certainly seen stock re oved several months ago coming back on recently. One crazy high price achieved on my watchlist - rest are sitting. As am I. The sellers remain deluded with the value of their liability.
Stock is heading to the rental market hence why it's difficult to find tenants.
Prices are not going anywhere and if anything, down.
The cost of carrying a rental is still very high, $250 p/w on a house in central Welly for rates and home insurance (not contents).
Even with mortgage rates down to 5%, you probably don't even break-even until 50% LVR.
Much of the churn in NZ property is for speculative profit taking, on which is needed FOMO from those they sell to, to keep the cycle going.
This Churn transaction is costly representing approx. 6% of the property value, made up of commission, legal, valuation, moving cists etc.
Just by reducing unneeded churn, a saving is made, which further can reduce prices overall.
Got any data to support that?
In this market, very hard to churn
Offer 1979 prices or nothing...
Thats silly Billy.
Any old Goat worth their Grifting salt, knows that NZ home prices are headed back to around 2015 valuations, or lower. This is almost 100% Guaranteed.
Ridiculously High current prices, massive holding/maintenance/interest costs, will see this current 4-year housing crash, play out further into 2027 and 2028.
and rent prices back to 2015 also?
Offer 1979 prices or nothing...
Spruiker Translation - "I've had a gutsful and I'm throwing in the towel"
About when you bought your 1st and last property...
It's a pretty accurate assumption that much like Zwifter above, you've now run out of patience and your end strategy is to make pointless empty headed comments.
Well done.
Well done on buying a home in 1979... maybe the next will be the forever retirement home.
Currently in negs with a vendor who was extremely upset with the initial offer. Expectation vs Reality.
Maybe you will be upset with the counter-offer and then you settle in to negotiate a value that neither of you are completely happy with, but somewhat reflects the market......
Totally! Though, I wont be upset, I think that was the point of the comment. Emotion off the table.
or, more likely they will not settle.
At this point - high probability.
When reality hits it hurts and many outside of home owners are about to discover with many lacking skills that will in future not command such a high wage or perhaps nothing.
I think the situation may be more significant than Greg's figures suggest, especially in Auckland. The supply of new houses isn't reflected in the listings - as developers list one townhouse when they have 10 to sell.
Wellington has less of this issue, although appetite to buy homes has clearly fallen off a cliff. But supply there slowed rapidly in the last few years.
A further element is that those homes that sold 'off the plans' during the building boom will be close to completion around now. So those may be purchasers will be either quitting rentals, in the case of FHBers, or selling homes for existing home owners. A lot of rentals may come to the market which will be a potential issue for landlords looking for a tenant.
If you are flying along in New Zealand now. There is a quiet fear that your plane could run out of gas (you or your partner lose your income)at any time. It costs less to rent a better plane than you can afford to buy. There is also the option to jump out anytime, deploy your parachute, and float down to land in Australia. If you own the plane you are handcuffed to your seat.
be very unlikely to see any FOMO in NZ general property markets both RE + CRE this decade .. we only had that during crazy COVID years as rates went to insanely low "Once in a lifetime levels" which created massive distortion of reality we are still living with as every tradie ,investor,retailer wanted top dollar and blamed COVID bah bah .. every homeowner now wants million+ for their shitbox as costs to replace to new standards cost well above .. basically we have much pain to come as NZ moves through its depression.. lower NZD will only make it worse for the majority so lower Interest rates won't fix it .. only deregs -investment into primary industries we see the best paying jobs in a growing primary industry then we will be on the right pathway ..if we continue to crush and stop primary then watch as the depression crushes average kiwis
YOU CAN'T GROW A NATION THROUGH DEBT WE HAVE TRIED ..AND NOW WE MUST REAP THAT STUPIDITY OF BIDDING UP HOUSING
Like the summer wine, the last of the cheap covid loans are rolling off exposing the over leveraged to financial reality.
Still reckon its gonna take the banks to actually start liquidating the over leveraged to make a sizable dent on price. People will start eating cockroaches before the take the capital loss. Or spending to much time on here thinking 20 ponzi pumping posts a day will turn the market. It wont. Gonna be really interesting how many refuse to pay the 27 per day cents to keep up their barrage of hopium.
Small point but the lowest 5 year COVID rates still have 16 months to run. Come mid-2026, everyone will have to have their swimming trunks back on.
Spruikers have been awfully quiet this morning?
where is everybody?!
I've got my popcorn ready for this comment session!
The frightening thing in my view is that inflation is now on-target and house prices seem locked into a slow decline. If this crystallises it might be a new era of housing moderation.
I was hoping house prices stay flat while people's income catching up. this is best way to get housing back to affordable while not hurting existing home owners too much.
Coorect but what chance of it happening in a recession?????
Spruikers and home hoarders know, in the pit of their sickened stomachs, that the road to untold riches in the NZ housing market is up. The once in 100 year crash, is but halfway done.
While the jig is well and truly done and dusted, some spruikers are still doing the awkward, Jed Clampit like, back and forward arm-dance-jig.....like the dying throws of the last band tune, on the Titanic.
The now endangered, "greater buying fool" has wisened up and simply won't pay moonbeams for your pile of sticks and dirt. Spruikers are slow, to get the now well-known memo :)
The NZ housing Ponzi has well and truly popped and as many more people become aware of it, this is ensuring its terminal decline, finishes its nose first impact, in the bush far below.
Surely it would be a good thing if the property market stayed subdued for many years to come. I am looking at figures from the 2021 and 2024 Demographia annual housing affordability study. They measure this by taking the median income to median value and cover 92 cities. In 2021, Auckland's ratio was 11.20, while for 2024, it was 8.20. That still makes it severely unaffordable but moving in the right direction. I would like to see it fall to around a ratio of 5 which would put it in line with cities such as Manchester in the UK, Ottowa in Canada and Washington DC in the US.
I don't know how long that might take, but it would give my grandchildren and their peers a better chance of being able to stay in NZ.
Exactly this - but people have to much financially and emotionally wrapped up in prices never falling that returning to a reality where prosperity might exist in the country for younger generations is too painful for many to face - even though it is the ethically/morally correct position to take.
When we finally move past the greed is good mentally then we might be able to start putting things right and starting again and making NZ a great place to settle down, but a house and raise some kids - the number of people leaving show that it is not that place right now - it’s the polar opposite if you are a FHB.
Depends if you want oranges but the vast majority are lemons. Example majorityvof buyers want 3brm freehold section with a bit of dirt and a garage. But if the majority of properties on the market are two bedroom two storied shit boxes with no parking then you aint going to sell them. There are only so many young so called proffessionals that dont have kids going to work on a ebike. Another example put a 3brm on the market last month had over 40 veiwings 3 offers accepted an offer for full asking price. Over 440 people had it on watchlist on TM the agent still getting ph calls for a veiwing. Young single guy buying it just like the other one I have an offer on the tenant a single mother buying it 4 bedroom single garage. She was the tenant so no RE fees and I knocked the market price back 35k. She was a great tenant. Those are real examples not heresay
You sound like a realistic vendor Colin, who understands the value of a quick and easy sale. Most, if approached privately wouldn't be willing to knock back the price with reference to saving REA fees, as they think they'd get a higher offer going via REA which would nullify the fees (tell emm he;s dreamin' daal).
I suppose so but i always buy in the no collar areas. That usually need work in painting tidying up etc etc. Alot of FHB have high expectations so leverage themselves to the max for the 4brm brand new build with ensuite etc etc. But i am happy in that two new FHB are buying a nice warm dry family home. Allows me to build a new build without going to banks and look at another purchase.
We all need projects to keep busy with. Sounds ideal to be able to shoot around the country and camp out while you work on yours, and get enough back to fund your lifestyle form the sales.
The increase in the number of houses for sale is great news for buyers, if you look long enough, you will find a great deal that suits you.
The best time to buy isn’t always yesterday even though this has been the FOMO mantra being promoted on this site and in general circulation by vested interests.
Good things do come to those who wait - even though it is the opposite of the ‘be quick’ mantra that tries to cause fear FOMO among buyers.
Watching this play out - imagine if it was the whole economy behaving like this with rampant deflation. The velocity of money
(not just RE dollars) would slow right down.
Deflation is kryptonite to western central bankers because we are living beyond our means - we would all default far too quickly with even a sniff of deflation - hence the way over the top response in 2020 when deflation looked possible. Ie we didn’t even have recorded deflation and CBs/governments went completely bonkers and caused a huge amount of inflation.
I think they could do that again but if they do rates could spike even higher this time - like up above 10%.
If I were Orr I wouldn’t be dropping the OCR next month - but equally I wouldn’t have dropped it anything like he did in 2020 which have caused the property market to go crazy, then high inflation, then falling house prices, unaffordable mortgages, expensive groceries and rates and bills. If they didn’t drop so far in 2020 we wouldn’t have had this pain we’ve had 2022-2024.
We could also avoid future pain by not dropping too low now as well - even though people will complain that dropping rates now May temporarily ease their pain (but these are generally people who are trying to live beyond their means eg too much mortgage debt relative to their incomes or buying up multiple properties)
Bond market is taking away the printing press
"Deflation is kryptonite"
Look what is happening in China ...
look at any country that does not use the western banking model and tell me the quality of its economy and class of living of its people.
Really drives home how property was not treated as any other investment but rather as a welfare scheme for the older and wealthier. Especially once you add in the $10 billion of welfare stimulus taxpayer money the RBNZ also threw to it.
I am a potential buyer and I think house prices are way too high. The reason is that the debt needed, both new and rolled over to sustain the current level of house value is not easily manageable by the nation. We are in recession and stagnation and need productive growth to export our way out. Diverted monetary allocation to housing has derailed our direction away with a high regulatory environment not helping either. We now need to buckle down and pay for the 100s of billions in housing debt. I will wait and I reckon lots others are too.
Buyers always think prices are too high... Sellers always think offers are too low.
not true.
Yes the deceased don't tend to complain much XD
I own already and fully expect further deflation in my house value and I accept it as a National Good for NZ. I count myself fortunate to buy a little while ago, at around a 4xDTI and glad to see it return to this reasonable level.
Speculators and vultures will detest reasonable price levels of 4xDTI - these people should reflect on their greed.
I have seen land bankers buy up properties in my area, in recent years They are now sitting on significant losses, if trying to liquidate today.
Buyers are best to wait, as many will be required (by their various lenders/banks) to sell their "investments" as the lenders loan forbearance is run out in many cases, as the multiyear NZ property crash rolls on, towards the late 2020s.
Buyers may wish to throw the speculators a bone.....look what they paid in 2012 to 2020 and add on 5%. If they purchased after 2020, take -30% off and walk away if they refuse. Tens of thousands of homes for sale and many hundreds added weekly.
Invest deposit money safely elsewhere, while property spirals down towards the reasonable 4 to 5xDTI - is the best financial course in my mind.
Still, each person should investigate deeply and make the best decision, given your circumstances.
My property is 4 to 5 dti. So we are already where you talk about
"I have seen land bankers buy up properties in my area, in recent years They are now sitting on significant losses, if trying to liquidate today"
Landbankers in the Watercare redzones in Auckland are sitting on unrealised losses.
Buyers will only pay what they think they can afford afford, maybe the growing overhang is above the price limit of majority of buyers, thus it will continue to grow.
Those on the Ladder may not see value in moving up a rung.
Yes, it should always come down to affordability. There are plenty of restrictions placed on buyers today, such as DTI, LTV etc and this is having the desired effect of stopping people buying properties they can't afford. The crazy days of leveraging yourself to the hilt are gone.
https://www.rnz.co.nz/news/business/539655/auckland-capital-valuations-…
"She said in New South Wales it was a requirement for an agent to tell a buyer the same price indication they had given the vendor.
In New Zealand, buyers were simply referred to the CV and left to work it out.
Martelli said a lot of homes were currently selling under the 2021 capital valuations.
"And so the concern is, these new CVs, will they reinforce those 2021 prices and as such the vendors will keep their expectations, or actually will we start to see a bit of a dip in those CVs."
NZ could benefit from the same regulations as Australia re transparency
I am a happy merchant to see house prices are going down. And even happier if it continues.
Home township rate going up is good for New Zealand.
The house price explosion of recent years has been New Zealand greatest social disaster. At so many levels.
Agreed.
Time for homes to stop sucking all the money / debt so more gets spent (and invested) in the real economy.
Make it illegal to securitize land. Improvements only. The banks will quickly tell you what your hovel is actually worth.
Would probably need to be matched with some regulation re: landbanking to prevent people hoarding it. LVT being one part of the solution, a rent cap another.
100% this
AKA latent market crash
here we go
All the property specs who don't own a house will be jumping in or
Tall poppy types
like this one
"I have seen land bankers buy up properties in my area, in recent years They are now sitting on significant losses, if trying to liquidate today"
Landbankers in the Watercare redzones in Auckland are sitting on unrealised losses.
J2 are you overleveraged and needing to sell in the next year or two???
I know of land bankers, now sweating bullets.......
Not yet. I sold a few and now vested in ETF . 23% returns last two years . and have some in TD.
Landbankers supposed to land bank ...get it ?
We welcome your comments below. If you are not already registered, please register to comment.
Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.