The residential property market could be at an important turning point for investors as rental yields start to rise.
A rental yield is a standardised way of comparing the potential gross income returns different properties could produce for investors.
It is the amount of rent a property could potentially generate in a year expressed as a percentage of its purchase price.
A higher yield suggests a property would provide a better rental return for an investor than one with a lower yield.
Until recently, yields have been trending lower as property prices rose faster than rents, reducing the rental returns available to investors.
But that appears to be changing, according to interest.co.nz’s Residential Investment Property Rental Yield Indicator.
The Indicator tracks the REINZ’s lower quartile selling prices for three bedroom houses in 56 locations around the country where there are high levels of rental activity, and matches them with the median rents on newly rented three bedroom houses in the same areas.
This allows it to track changes in the income earning potential of rental properties throughout the country.
The trend has been for yields to fall, as property prices have risen faster than rents, which has led to many investors chasing capital gains ahead of rental income.
But that now looks to have changed.
The latest Indicator shows that yields have risen in 27 of the locations monitored, fallen in 16 and were unchanged in 13, based on REINZ lower quartile selling prices and median rents on newly let properties in the six months to September (see table below).
That compares with 20 locations that showed rising yields, 27 that showed falls and nine that were unchanged based on prices and rents for the six months to June.
The trend was particularly pronounced in Auckland, where yields rose in six of the suburbs monitored, were unchanged in three but didn’t decline in any of them, and also in Christchurch.
But the indicative yields were also mostly rising or flat in places like the Waikato and Bay of Plenty which have been hot spots for residential property investors over the last couple of years.
That suggests a significant change in conditions for investors, and may mark a return to a market that is driven by fundamentals, where investors focus on long term income returns rather than capital gains.
In most cases the rising yields were driven by increases in rents but often also by falls in lower quartile selling prices.
However it is still early days and the indicative yields remain extremely low in most main centres.
In Auckland, they remain below 5% in all of the districts monitored and below 4% in half of them.
So the market may have some distance to travel before the returns are attractive enough to encourage a major jump in investor activity in the absence of capital gains.
The change also presents some challenges for investors who purchased rental properties several years ago.
They are likely to have seen a substantial increase in the capital value of their properties along with steadily increasing rental income.
With interest rates remaining at very low levels they would likely be in a very fortunate situation.
But if the market has turned, they will need to consider whether the money they have tied up in those investments is now working hard enough for them.
They will need to decide whether to hang on to their properties for growth in rental income and flat or possibly declining capital values, or cash up and take the the capital gains and reinvest the money elsewhere.
The outlook for interest rates is likely to be a major factor in whichever way they decide to go.
 Indicative gross rental yields for three bedroom houses in 56 selected areas with high rental activity during the previous six months. Based on REINZ lower quartile selling prices and median rents recorded by Tenancy Services' Bonds Centre in each area over the previous six months. |
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| Town/region | Yield % Sept 2017 | Yield % June 2017 |
Yield % March 2017 | Yield % Dec 2016 | Yield % Sept 2016 | Yield % June 2016 | Yield % March 2016 | Yield % Dec 2015 |
Yield %
Sept 2015
|
Yield %
June 2015 |
Yield %
March 2015
|
Yield %
Dec 2014
|
Sept 2014
|
| Whangarei: | |||||||||||||
| Kamo/Tikipunga/Kensington | 5.3 | 5.5 | 5.4 | 5.4 | 5.9 | 6.1 | 6.0 | 5.6 | 7.1 | 6.5 | 6.9 | 7.6 |
6.4
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| Rodney - Orewa/Whangaparaoa | 4.0 | 4.0 | 4.0 | 3.8 | 3.9 | 4.1 | 4.1 | 4.1 | 4.3 | 4.5 | 4.5 | 4.6 |
4.8
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| North Shore: |
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| Beach Haven/Birkdale | 4.0 | 3.8 | 3.7 | 3.7 | 3.7 | 3.7 | 3.9 | 3.8 | 3.9 | 4.0 | 4.3 | 4.3 |
4.6
|
| Torbay | 3.6 | 3.6 | 3.7 | 3.6 | 3.4 | 3.6 | 3.8 | 3.6 | 3.8 | 4.0 | 4.5 | 4.6 |
4.5
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| Waitakere: |
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| Glen Eden | 3.9 | 3.9 | 4.0 | 3.8 | 3.7 | 3.9 | 4.0 | 4.0 | 4.1 | 4.3 | 4.6 | 4.9 |
5.1
|
| Massey/Royal Heights | 3.9 | 3.8 | 4.0 | 3.9 | 3.8 | 4.1 | 4.1 | 4.0 | 4.1 | 4.4 | 4.6 | 4.9 |
5.1
|
| Henderson | 4.1 | 4.0 | 3.9 | 3.8 | 3.8 | 3.8 | 4.1 | 4.1 | 4.1 | 4.4 | 4.7 | 4.9 |
5.0
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| Central Auckland: |
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| Avondale | 3.6 | 3.5 | 3.6 | 3.6 | 3.7 | 3.6 | 3.7 | 3.7 | 3.9 | 4.1 | 4.2 | 4.4 |
4.5
|
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| Manukau: |
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| Highland Park | 3.8 | 3.6 | 3.5 | 3.5 | 3.4 | 3.3 | 3.3 | 3.6 | 3.6 | 3.8 | 3.8 | 4.1 |
4.3
|
| Papakura/Drury/Karaka | 4.7 | 4.3 | 4.3 | 4.4 | 4.4 | 4.7 | 4.8 | 4.8 | 4.9 | 5.5 | 5.6 | 5.9 |
6.0
|
| Franklin - Pukekohe/Tuakau | 4.8 | 4.8 | 4.6 | 4.4 | 4.3 | 4.5 | 4.9 | 5.0 | 5.0 | 5.3 | 5.5 | 5.6 |
5.6
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| Hamilton: |
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| Deanwell/Melville/Fitzroy | 4.8 | 4.8 | 4.8 | 5.0 | 5.1 | 5.4 | 5.3 | 5.5 | 6.2 | 6.8 | 6.9 | 6.9 |
6.9
|
| Fairfield/Fairview Downs | 4.5 | 4.5 | 4.9 | 4.8 | 4.8 | 5.1 | 5.4 | 5.7 | 6.0 | 6.8 | 6.7 | 6.2 |
7.0
|
| Te Kowhai/St Andrews/Queenswood | 4.6 | 4.5 | 4.4 | 4.3 | 4.6 | 4.7 | 4.7 | 4.9 | 5.3 | 5.4 | 5.4 | 5.6 |
5.8
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| Cambridge/Leamington | 4.4 | 4.4 | 4.6 | 4.6 | 4.7 | 4.8 | 5.2 | 5.3 | 5.2 | 5.5 | 5.5 | 5.6 |
5.9
|
| Te Awamutu | 5.0 | 5.1 | 5.0 | 5.1 | 5.2 | 5.2 | 5.7 | 6.2 | 6.3 | 6.5 | 6.2 | 6.3 |
6.4
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| Tauranga: |
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| Tauranga Central/Greerton | 5.1 | 4.7 | 4.6 | 4.4 | 4.3 | 3.7 | 5.2 | 5.2 | 5.6 | 6.0 | 6.1 | 5.9 |
5.9
|
| Bethlehem/Otumoetai | 4.1 | 4.0 | 4.1 | 3.7 | 4.2 | 4.2 | 4.6 | 4.8 | 4.8 | 4.5 | 4.8 | 5.3 |
5.4
|
| Mt Maunganui | 4.3 | 4.4 | 4.4 | 4.2 | 4.2 | 4.4 | 4.8 | 4.6 | 4.7 | 5.4 | 5.7 | 5.6 |
5.2
|
| Pyes Pa/Welcome Bay | 4.7 | 4.3 | 4.8 | 4.8 | 4.9 | 4.8 | 5.4 | 5.5 | 5.3 | 5.9 | 5.7 | 5.7 |
5.8
|
| Kaimai/Te Puke | 5.0 | 4.9 | 5.3 | 5.4 | 5.5 | 5.6 | 5.8 | 5.9 | 6.2 | 6.4 | 6.2 | 6.2 |
5.7
|
| Whakatane | 6.1 | 6.0 | 6.1 | 5.8 | 6.5 | 6.6 | 6.4 | 7.1 | 7.3 | 6.7 | 6.3 | 6.7 |
6.9
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| Roturua: | |||||||||||||
| Holdens Bay/Owhata/Ngapuna | 9.3 | 10.5 | 8.0 | 9.7 | 10.7 | 9.4 | 8.7 | 8.3 | 8.7 | n.a. | n.a. | n.a. | n.a. |
| Kuirau/Hillcrest/Glenholm | 5.6 | 5.5 | 4.9 | 7.3 | 7.5 | 6.4 | 5.9 | 6.3 | 6.6 | n.a. | n.a. | n.a. | n.a. |
| Ngongataha/Pleasant Heights/Koutu | 8.5 | 6.2 | 8.6 | 8.2 | 7.2 | 7.9 | 7.7 | 8.0 | 8.2 | n.a. | n.a. | n.a. | n.a. |
| Hastings - Flaxmere | 9.9 | 9.3 | 8.9 | 8.6 | 9.4 | 9.3 | 10.9 | 11.5 | 11.0 | 12.1 | 12.2 | 11.7 |
11.8
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| Napier - Taradale | 4.4 | 4.9 | 5.0 | 4.9 | 5.1 | 5.5 | 5.4 | 5.6 | 5.5 | 5.3 | 6.2 | 6.3 |
6.1
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| Taranaki: | |||||||||||||
| New Plymouth Central/Moturoa | 5.4 | 4.9 | 4.7 | 5.3 | 5.1 | 5.4 | 5.8 | 5.4 | 5.5 | n.a. | n.a. | n.a. | n.a. |
| Waitara/Inglewood | 6.0 | 7.2 | 8.1 | 7.0 | 7.7 | 7.7 | 8.8 | 8.9 | 8.0 | n.a. | n.a. | n.a. | n.a. |
| Whanganui | 8.7 | 8.6 | 9.1 | 9.7 | 9.7 | 10.3 | 9.6 | 10.0 | 14.9 | n.a. | n.a. | n.a. | n.a. |
| Palmerston North: | |||||||||||||
| Kelvin Grove/Roslyn | 6.3 | 6.5 | 6.6 | 6.6 | 7.0 | 7.3 | 7.4 | 7.2 | 7.2 | n.a. | n.a. | n.a. | n.a. |
| Palmerston North Central | 5.5 | 6.0 | 5.9 | 5.6 | 6.5 | 6.3 | 5.6 | 5.5 | 6.2 | n.a. | n.a. | n.a. | n.a. |
| Takaro/Cloverlea/Milson | 6.2 | 6.2 | 6.1 | 6.3 | 6.7 | 6.8 | 7.2 | 7.1 | 7.3 | n.a. | n.a. | n.a. | n.a. |
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| Kapiti Coast: |
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| Paraparaumu/Raumati | 5.0 | 4.9 | 4.8 | 5.3 | 5.6 | 5.7 | 5.9 | 6.0 | 6.1 | 6.2 | 6.1 | 6.1 |
5.9
|
| Waikanae/Otaki | 4.7 | 4.7 | 5.2 | 5.5 | 5.8 | 5.8 | 5.9 | 6.5 | 6.8 | 6.6 | 6.7 | 5.5 |
5.4
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| Upper Hutt: | |||||||||||||
| Heretaunga/Silverstream | 5.4 | 4.7 | 4.7 | 4.6 | 5.3 | 5.6 | 5.8 | 5.8 | 6.1 | n.a. | n.a. | n.a. | n.a. |
| Totara Park/Maoribank/Te Marua | 5.7 | 5.8 | 5.8 | 5.2 | 5.7 | 6.2 | 6.3 | 6.2 | 6.8 | n.a. | n.a. | n.a. | n.a. |
| Lower Hutt: | |||||||||||||
| Epuni/Avalon | 4.8 | 4.9 | 5.1 | 5.6 | 5.1 | 5.5 | 5.8 | 5.2 | 5.1 | n.a. | n.a. | n.a. | n.a. |
| Taita/Naenae | 5.5 | 5.6 | 5.8 | 6.1 | 6.2 | 6.5 | 6.8 | 6.9 | 7.1 | n.a. | n.a. | n.a. | n.a. |
| Wainuiomata | 5.7 | 5.9 | 5.9 | 6.3 | 7.0 | 7.2 | 7.7 | 7.7 | 7.7 | n.a. | n.a. | n.a. | n.a. |
| Wellington: |
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| Johnsonville/Newlands | 5.0 | 5.0 | 4.9 | 4.8 | 4.8 | 5.2 | 5.5 | 5.4 | 5.6 | 5.8 | 5.6 | 5.5 |
6.2
|
| Vogeltown/Berhampore/Newtown | 4.5 | 4.5 | 4.2 | 4.1 | 4.6 | 4.9 | 5.4 | 5.2 | 5.5 | 5.1 | 5.5 | 5.2 |
5.6
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| Tasman: |
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| Motueka | 5.0 | 4.4 | 4.0 | 4.0 | 4.7 | 5.3 | 5.2 | 5.4 | 5.3 | 5.3 | 5.5 | 5.6 |
5.5
|
| Richmond/Wakefield/Brightwater | 4.8 | 4.6 | 4.7 | 4.6 | 4.8 | 5.3 | 5.3 | 5.3 | 5.5 | 5.6 | 5.6 | 5.8 |
5.9
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| Nelson - Stoke/Nayland/Tahunanui | 4.8 | 5.0 | 5.1 | 5.1 | 5.2 | 5.3 | 5.5 | 5.7 | 5.8 | 5.9 | 5.7 | 5.7 |
6.0
|
| Blenheim | 5.7 | 5.6 | 5.8 | 6.3 | 6.5 | 6.5 | 7.0 | 7.0 | 6.4 | 6.5 | 6.5 | 6.6 |
6.5
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| Christchurch: |
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| Hornby/Islington/Hei Hei | 5.6 | 5.6 | 5.6 | 5.7 | 6.1 | 6.1 | 6.0 | 6.0 | 6.2 | 6.2 | 6.3 | 6.5 |
6.3
|
| Riccarton | 5.1 | 4.7 | 5.0 | 5.2 | 5.5 | 5.0 | 5.7 | 5.0 | 4.9 | 5.9 | 5.2 | 4.9 |
5.1
|
| Woolston/Opawa | 6.2 | 6.0 | 6.2 | 6.5 | 6.6 | 7.4 | 6.3 | 6.4 | 6.6 | 6.8 | 7.3 | 7.2 |
8.0
|
| Ashburton | 6.3 | 7.0 | 8.3 | 8.4 | 6.3 | 6.1 | 6.2 | 7.0 | 6.9 | 7.0 | 6.8 | 6.7 |
7.2
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| Timaru | 6.0 | 5.7 | 6.0 | 5.9 | 6.1 | 6.4 | 6.5 | 6.4 | 6.2 | 6.6 | 6.8 | 6.7 |
6.3
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| Queenstown/Frankton/Arrowtown | 4.4 | 4.6 | 4.3 | 4.1 | 4.5 | 4.3 | 4.6 | 5.2 | 5.0 | 4.8 | 4.9 | 4.7 |
5.3
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| Dunedin: | |||||||||||||
| Kenmure/Mornington | 5.8 | 6.3 | 7.5 | 6.5 | 6.3 | 6.7 | 7.9 | 7.1 | 6.6 | n.a. | n.a. | n.a. | n.a. |
| Mosgiel | 5.4 | 5.4 | 5.5 | 5.7 | 5.7 | 5.7 | 6.4 | 6.4 | 6.1 | n.a. | n.a. | n.a. | n.a. |
| South Dunedin/St Kilda | 8.6 | 8.0 | 7.9 | 7.5 | 8.1 | 7.4 | 7.2 | 8.0 | 8.2 | n.a. | n.a. | n.a. | n.a. |
| Invercargill | 8.9 | 8.3 | 8.3 | 7.9 | 8.3 | 8.4 | 8.7 | 9.1 | 9.0 | 6.7 | 9.0 | 9.2 |
9.5
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Source : REINZ / MBIE *Yield is a property's annual rent expressed as a percentage of its purchase price. The indicative yield figures in this table are gross, and are calculated from the REINZ's lower quartile selling price for three bedroom houses in each area during the previous 6 months, and the median rent for three bedroom houses calculated from new tenancy bonds received by the Ministry of Business Innovation and Employment for the same areas/period. This gives an indication of the gross rental yield that would have been achieved in each area if a three bedroom house was purchased at the lower quarter price and rented at the median rent for that area. |
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60 Comments
It'll be interesting to see how fundamentals are changed when WInston declares the winner of the election. ie Will he get his desired cuts in immigration and block non resident/non NZ citizens from buying residential property.
This could signal a marked change for speculators in NZ real estate.
How many investors in the last few years have only played the market for capital gains. Also only choosing interest only loans. I stopped counting the same houses being sold 2 or 3 in the last 3 years, unbelievable. There’ll be long term investors for sure. Always is. Even in downturns . But theres so many 30 to 40 year olds lately that are only in the market for a quick buck it’s unbelievable. And they don’t have the patience for long term 30 year investment. I know one the other day, he sold a perfect rental for only about $10000 profit. I said to him you’re mad rent it. He said there’s no capital gains move on, can’t be bothered with tenants
So Q4 whatever thinks taking a 10K Profit today in a market trending down is somehow a bad thing to do
Not everyone investing in property wants to tie up capital for the long term anyway
Tenants indeed cause damage that’s just a given
I know a wealthy Chinese lady who refused to rent any of her homes she purchased in Auckland
Purely speculation oriented for capital gain
Take the quick capital gains away and you have a new Auckland housing paradigm
So the guy was right to sell today and take his profit
If the issue was a shortage of supply both rentals and prices would have risen in tandem. In reality as rentals have risen then people have found alternative, more intense living arrangements. However, prices have risen while rentals have only crept up - showing the focus has been on capital gains. That rentals are disconnected from prices is the proof that the current market is a bubble. And the growth in yields is the sign of the slow deflating of the bubble.
lol, why are you so worried about what and how other people do with their money and investment ??? .. Are you now concerned about property investors and providing wise financial council to them?
Poor analysis of Data to say the least based on 0.1 or 0.2% change ( which is hardly noise in most significant towns and rental markets) and nothing out of the norm of seasonal pricing and S&D during winter times ...!! you should have waited for a couple more quarters to jump to conclusions ..
No news here, just Noise!
"The change also presents some challenges for investors who purchased rental properties several years ago
... They will need to decide whether to hang on to their properties ....or cash up and take the capital gains and reinvest the money elsewhere."
Decisions, decisions. One thing's certain. The answer to that question will be obvious...looking back.
As prices come down tenants will buy house. Flippers will exit the market and long term investors will pickup the odd house . But in short this is normal stuff. The market will keep going down because the big money and volume for demand is gone. Listings will keep lifting because the number of buyers is far to low to keep up. A sale could take months so focks will drop there price to get that buyer. Normal stuff really. The more expensive will get hit the worse which is normal for a downturn as suburbs close by drop there prices making a dominoes affect. Also there’s a few high priced buyers but hardly enough to keep the ball rolling
Hi O4 normal,
You're on very shaky ground if you assume house prices will keep going down.
As time passes, increased rental yields will underpin increases in house prices.
But other important factors come into play as well - not the least being demographic pressures and supply constraints for new-builds (and renovations).
With rents rising, capital prices don't have to fall at all for yields to increase. Seriously TTP? If you really think renters can be subjected to continued rent increases, you are kindly mistaken. Consumers are tapped out. One of many key indicators is the phenomenal growth rate of so called debt refinancing specialists, second tier lenders, or more bluntly - loan sharks. Bundled together with specuvestor-Landlords, these people cannot argue they are performing a public service! This is the biggest bubble of all time. When the tide goes out, cheap money will not fix this. It will unlikely be a 40% drop in houses and shares. As more time goes by without the necessary rebalancing - it will most likely be 60% drop! Once the bust comes, unemployment will rise quite quickly causing the young to head back home to their parents. Just picture all those empty rentals! Rents will fall with house prices and where does that leave rental yields?
I’d be happy if flippers were gone all together . They more or less fed on themselves over the last few years, now they’ll leave or are now. With them gone and there volume the market should get back to normal. The difference between owner occupied and rentals should get back to a better % . People buying Should in time have lower mortgages so having more money to spend on other things. Great . And long term investors can go back to picking up investments property for reasonable prices with reasonable returns. We aren’t totally there yet but we are going in the right direction at last
Kakapo. Yeah I’m sorry to say this, I’m 57 and I’ve talked to many mates, people. But 30 to 40 year olds have a completely different idea on investing. Maybe I’m to old, or there parents have stuffed them up. But there attitude is buy in and get out and make a killing and unless I make heaps in a short time I’m not interested. That and overseas investors is exactly where all this demand has come from and that’s exactly what’s going to end it
Just remember focks and this is very important. In 2008 and in other cycles the up cycle with high demand changed for whatever reason you wish to come up with and went to a down cycle. Homes are now selling on a downward cycle. Once a cycle ends , usually debt, the market slows like it did in 2008 and many other times and governments , RB , RE , and the media if you like try and talk or change it, IT SIMPLY DOESNT HAPPEN AND REALLY HOW COULD THEY, the market has maxed out with to much debt, this cycle is worse because we have borrowed 40% more than 2007 , we’ve gone mad on interest only loans and flippers, prices have doubled not long after already doubling not long ago. And the worse is we have relied on a market of overseas investors and stupidity high immigration. Add to that in 2008 we enjoyed interest rates dropping massively and investors didn’t pick that cycle up why should anything be any different now under these terrible conditions . 2008 wasn’t that bad but theres no way it could be better
To put into context...
2016
$1million house
$200,000 deposit
$800,000 loan @ 4.2%
Payments $903 per week
COST principle and interest over 30 years $1,408,369
Median household income $1,575 week?
2007 last peak
$576,563 house ??
$115,312 deposit
$461,250 loan @ 9.6%
Payments $903 per week
COST principle and interest over 30 years $1,408,369
Median household income $1,258 week
Re interest only loans...If you have investment properties with mortgage and a residence with a mortgage it is simple common sense to go interest only on investment properties (tax deductible) while maximising principle repayments on the home mortgage. And if on a growth strategy it also makes sense.
Re house flippers. The amateurs buy a house for too much, spend too much on doing up, take way too long and only fluke a return because the market was going gangbusters. The professionals really don't care what the market is doing. They gain value either at purchase and/or they add it through judicious spruce up and sell on the same market, quickly. I fail to see why they are any worse than used car sales yards. Or for that manner, retailers of anything
How common were 30 year mortgages in the past compared to now, though? Most Kiwis (well, ones I know) seemed to pay their mortgages off much quicker. We're normalising 30 years now, from the looks of it.
There's much more pressure on employability over a 30 year term, and risk commensurate with that. Obviously will improve the uptake for life event insurance, which everyone with a mortgage should have.
25 years was common 17 years ago as well when I had my first and only mortgage. $250k at 7.5% was more manageable than $500k at 4.5%.
I think what Rick is referring to though is that even if the term was 25-30 years it seemed that most were able to be paid off in half that time especially if house price/mortgage are only 2-3x income.
What was wage inflation like back then? Wasn’t it fairly high, well certainly further back in like the 80s. It’s amazing what wage inflation does to debt burdens. Now today our debt is much higher, wage inflation and interest rates are much lower so you’re in it for the long haul. A 30 year mortgage is more likely to be just that, no massive inflationary shortcuts.
Robt , yes i can see by your figures how stupid it all is and why bubbles form, lucky interest rates didn’t go up this cycle, weekly payments could have been over $2000, you show a good picture of the stupidity, and why flippers do interest only, short term, now we crash and home owners loss, I think the 2007 way is better tho because lifting rates you would hope slow buyers and if the market crashes which it did it helps a lot to save the market going down to far from the stupidity of people taking it up to far in the first places,
Okay, so what's the access cost?
It has increased by 73% in your example ($85k), while median incomes have increased by...25%.
And what's the opportunity cost of all that rent spent over the differential time period spent saving for a deposit?
http://www.interest.co.nz/property/88363/saving-20-deposit-lower-priced…
Any schoolboy can do the period interest payment calculation.
Using that as the basis to argue affordability is unchanged is pretty naive.
I guess no one will be back to this column now we have new government excitement (or gloom). But in answer to your post "any schoolboy can..." But many don't. The truth is i wasn't arguing anything other than to put it in context. I know the deposit gap is a major factor and the lvr rules have changed it big time and if interest rates go up a couple of numbers a lot of people will be in trouble.
Yvil makes general assumptions on everyone who tends to disagree with her "investment" strategy. I love reading her comments just for entertainment purposes while I sleep easy knowing that I will never have the bank calling on me to "re-negotiate" my term loans. I may however one day soon take a bit of hit from my shares in the banks loosing significant value overnight.
Robt don’t forget you would never get 30 years at 9.6%. In fact if we have a cycle about every decade . Say the 2000 to 2010 period the interest rates were only high for about 2 years so over 30 if you wanted to work something out this ruff it might be highISH 6 years out of 30. At the end of the day incomes haven’t kept up at all and we are trying to use interest rates to make things look alright. Silly
All we can ever know is the rates we have now. The past is gone and the future may never come. I once devised a database that had all the rates on offer, special deals, cash backs etc to try to accurately compare different loan offerings from different lenders in terms of total cost over the term of the loan. All very good but as time passed and banks changed policy and increased or decreased their margins to suit the circumstances of the day it all became irrelevant. In the end of the day get the best deal you can get on the day and be ready to change
Be better if house prices are 900K and interest rates are 6%. So a drop in house prices and an increase in interest rates. Sounds better to me.
Lets have a drop in house prices through DTI, reduce immigration, increase in supply, keep LVRs, and increase in interest.
As Rick says I can pay lump sums as well, which will decrease the amount I pay.
Not many jobs in Tokoroa, which means high unemployment and all the social issues like high drug use, high mental health needs and self employed meth businesses, all of which are untaxed, underground and in the end saves the tax payer because you now own the ex-state housing rental block and all of the costs are now on YOU. National did get that one right when they started selling off all the ex-state houses to the gullible investors. GO FOR IT.
Change is now a reality. It could never happed...tui
No more overseas specuvestment, and crazy immigration policys. Doller is weakening making international specuvestment worth less every day. Overseas owner ship register coming, regardless of name on title, just follow the moneytrail, and if thats the casino... Perhaps the list will be leaked to the GRC? More flipper hurdles and talk of housing wof.
When will the bail out start? Yields returning to determine property values...shock horror.
The speculator music has been slowing for some time. To the stupidly in debt, leverage up ponzi....any rush to the exit is going to be pretty congested, just like the mess that Akl traffic has been allowed to become.
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