Associate Finance Minister David Parker says the price of New Zealand homes should be set by buyers in this country, not those from overseas

Legislation change noted "In section 7(1), replace “resident” with “ordinarily resident in New Zealand”.

Cant wait.

Non, Nah, Nein, O'hi, lo, Nei, Tidak, lie, Nedda, Nee, Jo, Aye, Iaa, Votch, Ez, Na, Ne, Nann, m hai, bu shi,.........

but on behalf of my children, thank you Jacinda and team for having the courage that weak men have failed to display..

I second that Fantastic! Way to go David. :)

Come back to Earth. .

"If" stands stiff in the corner

It might be a long time before they get that chance. National lost a lot of credibility during their final term.

So far this government is fulfilling promises, and despite what the "business" community might be complaining about, they seem to be making the right moves.

I'm in the same boat mate! Be patient. If prices fall $100k, roughly 10-15%, that means you not only saved that, but also the compounded interest for 30 years! That makes the current rent we pay more than worth it.

I am sitting on the fence FHB too, if the ban is in place by next month, you reckon the prices will come down ? by what %

If prices start to drop, won't you then say you don't want to catch a falling knife?

I really do prefer "trend is your friend". Look at the 80 year trend.

Just trying to give honest input here. Every first home buyer thinks prices are too high when they enter the market, but those who take the leap tend not to regret it. Do you know anyone who has purchased a house in NZ and then regretted it? I know plenty who regret waiting.

It's a sin to dream

The article states next month.

Sorry.. Why do companies need to buy residential properties? As I think companies and trusts should also be banned from purchasing residential properties..

What about companies set up to invest in property in NZ, by foreign interests? a part of the many discussion here has been that no one really knew the extent of foreign ownership of residential properties. So if foreign interests set up a company to then purchase property for an investment, how would the law change capture them?

Deflation indeed. I think you will also hear the specuvestors splattering their undies while speed dialing the pharmacy for a bucket of Pepto Bismol. Suspecting there could be some deposits abandoned just like Melbourne. Who will settle on all the multi million doller apartments in DGZ now...?

Could become very interesting changes for overseas absentee owners in the likes of Queenstown as well. Stuff about "commitment to NZ". Buying up housing and occupying it for only 1-2 weeks then leaving it vacant the rest of the year will no longer be a goer. Will be interesting to see how much of Arrowtown and Queenstown will will fail this new test.

Where is the dgz echo chamber? Not one has appeared yet.

National already did all the required analysis. Apparently banning foreign buyers will have little to no affect on house prices so you should be able to sleep easy tonight

I've only read the first part of your post but you are asking if the losses of speculators will be compensated by the Government? Socialise the losses and privatise the profits. People buying houses are adults and they wear the risk of their poor decision making.

JimboJones is 100% correct.

National's analysis determined that foreign buyers have little-to-no influence on NZ property prices, ergo your concerns are entirely unfounded. You can refer back to Bill English saying as much if it helps jog your memory. Hope this helps.

The government was elected on a clear platform of making housing more affordable, it's clear that in reality this means at least stabilising prices and most likely reducing them. Many voted for them because prices were too high and it'll be good for the country if they come down. Besides, losing 10-20% only takes away a little of the froth that appeared in the last few years, it shouldn't be devastating to anyone who has purchased conservatively and the LVR rules will protect the banks from that kind of fall.

In reality cheaper houses are good for everybody. I have some sympathy for those who think their savings are being wiped out, but that is an 'investment' mindset, while if all houses are cheaper it will actually cost them less to move up in quality of home.

I'd really love it if they have looked into it, as I have genuine concerns about all of this, if someone knows that they have, could they link me something?

The Reserve Bank does 'stress tests' on all bank lending;

Hope that helps.

lol

Laland, you have made some interesting points, but can we just unpick a few of them a moment? Because I think you have greatly exaggerated in several ways.

"A) the current owner is hanging on desperately, as to not have his life savings wiped out by selling for a loss"

Housing wealth is very concentrated in the hands of an increasingly small demographic. I would dispute that a housing crash would wipe out ALL of their wealth. I would suggest that most could still afford a perfectly lovely retirement, even if all of the houses in their portfolio lost capital value. Call me cynical, but if these alleged home owners are retiring with little to no mortgage on their family home, plus own additional rental properties, then I'm not going to lose sleep about their financial survival. They will be fine, gutted, but fine.

"B) the deposit you were going to use to obtain a loan has been wiped out with the OBR being triggered for bank balance sheets becoming pressured as free equity is eroded"

Since when did the OBR "haircut" wipe out the entirety of deposits? Assuming you have read the OBR policy? The policy is meant to prevent the bank from going under and taking customers money down with it (the very opposite of your suggestion). It's meant to prevent a run on a bank, so that there aren't customers losing their entire savings. I have close friends in Cyprus who went through something very similar to the proposed OBR policy. People lost some of their savings, a small percentage. Nothing got wiped out. NOTHING. No one had all their savings taken away. That is not what the OBR is designed to do and i'm sorry but this just seems like blatant scaremongering.

"C) the banks are very very nervous and thinking about their own survival, so won't give you a loan anyway."

To survive banks have to make money, banks make money by lending, so the opposite is true, banks have to lend to survive. If we look at the countries who were genuinely and seriously affected by the GFC, and we look at the credit crunch environments in those countries afterwards....at no point did banks stop lending!!!! They just tightened lending criteria.....and would only lend to attractive borrowers. I.E they needed to have a job and a decent deposit.

In the UK, during the credit crunch, banks were falling over themselves to lend to borrowers with above 25% deposit. If house prices come down, all those who have been diligently saving, might find that their deposit is suddenly making them much more desirable borrowers. For the average under 40, who has a job (not related to the RE industry), who has been saving, they might very well become a very desirable borrower.

I bought a house in the deep pit of the UK credit crunch. I was 33, with two kids and had over a 25% deposit and my mortgage was approved in a nanosecond. They were delighted to lend. There was a housing crash and guess what? People like me actually found it EASIER to buy a house.

"And finally D) you can't afford the house anymore, because unemployment is moving up as consumption has dropped significantly, the economy is in recession, and you've unfortunately lost your job or had your hours cut down heavily".

NZ has plenty of recession resistant industries. Why would exports be affected by a recession? Recession would likely lower NZD and this might actually increase exports in the short term. Why would tourism be affected by a recession? NZ will still be an attractive place to visit? When we look at bad unemployment rates... what are we usually talking about 8%-9%? Even if it went beyond 10% we are still talking about a huge majority of people still working and, should they have a deposit, still be eligible for a mortgage.

Necessity is also the mother of invention. Perhaps NZ productivity is appallingly lower because so much of our time and energy is invested in the swollen, bloated housing market? Perhaps a shock to the system will provide the impetus for innovative business to actually finally have a chance? This isn't a fairy tale, this is what generally happens after a recession, when they crappier industries who have been bobbing along and coasting on easy growth are culled, clearing the way for companies who actually have real growth potential. That's been a regular feature of every financial cycle worldwide.

Yes, real estate related jobs will suffer, but then they have to. Real Estate should never, ever have been allowed to become the economic juggernaut it has. At some point, for the long term betterment of New Zealanders, that has to change.

After the GFC my husband and I started our own business in the UK. And by golly are we glad we did. Our self made income has more than doubled since.

Wait, wut? i hear you cry...there has been negligible wage growth since then...not if you have a productive, innovative business it's not.

AND as if that wasn't enough... what happens every time NZ economy is in the doldrums? The government steps in to employ more people... which considering how low government debt is... is a very like outcome.

I don't disagree with you on your rationale for shorting the housing market, but on your prognostications? Wildly exaggerated.

Haha...perhaps he didn't go to a Grammar School?

Do people typically put their high school in their CV? I stopped bothering with that as soon as I got a degree. I would find it a bit tragic if I got a CV from anyone over the age of 25 and it had their high school on it.

Hmmm, I went to a rather better public school than you have in NZ, a school that has much more clout globally than NZ. Which maybe gives me a different perspective on class and meritocracy than the one you have.

My daughter attends Selwyn, because she chose to, there were multiple options available to her, but she wanted to go there. I was extremely hesitant about the prospect, but I went to the open day and was pleasantly surprised, there's a lot of passion there, a lot of determination to turn around the school's "lack of status", it's zoned now so an entirely different intake of students, in an exceptionally wealthy area (you can take the boy out of public school, you can't take out the snobbery), there's a tiny roll as the Kohi and St Thomas kids disappear off to Dio, St Kents etc...

Strange, I thought I heard a whimpering whilst out walking the leafy green streets today. I do hope the schizophrenic DGZ/Dr Smith are alright.

And Westpac were very quick to raise a term deposit rate to 3.85%... mmmhhh.. And they wanted a flat housing market for 30 years but are now seeking depositor funds whilst kiwibank reduce their mortgage rates........

Exactly, what would David Parker know about it anyway?

You are too kind trying to sooth the terrified specuvestors.

It needs to go through two more readings, no select committee unless they uncover something major

The thing is that the Australian version has so many loopholes you can drive a Great Wall through it. Which is why I suspect the NZ version will be the same. For instance, Australia allows temporary residents to buy houses, with the proviso that they be sold if/when the person leaves the country. However, nobody ever checks if the house has been sold. And they allow foreign buyers to buy existing homes for the purposes of redevelopment, so they buy all these homes on big sections in the leafy suburbs, submit a planning proposal to council, then do nothing about it for years while the house sits empty appreciating in value. And then there is the foreign buying of land for redevelopment - no restrictions on this with 2/3 of Melbourne land going to Chinese developers https://www.afr.com/real-estate/residential/vic/twothirds-of-all-sales-…

I am betting that this is exactly the same rubbish legislation that will ultimately end up being passed - looks good on paper but useless in practice.

Prices will always revert to the median. Exactly right Patrick.

This has a new agent but is not a new listing. It has been on the market for a long time with a different agent.

Who would pay £6,000,000 to live in a shed, 2000 miles away from the nearest decent city and over 6000 miles from a proper continent? Also to have no land and neighbours so close they practically overlook your wife and kids in the garden.... I think this gamblers den may have just closed Double-GZ..

http://www.rightmove.co.uk/property-for-sale/property-67588904.html - short skip out of London and Gatwick Aiport. similar money - neighbours.. nah, space?

What a bubble....

What a dump.

Yawn

Dont really like that house, I would take it in a heartbeat, but would sell it.

I rather a beach view, or a view of some sort, but for all that money definitely buy house off a beach. I like the houses along Takapuna, Cheltenham, and around the Shore, plus some good places around the Eastern Beaches, even Waiheke. They have easy access to beach.

Devonport has a nice villagey feel and close to city & beaches.

To be fair I would never spend that much on a house even if I had the money. I would take the 11 mill though.

Where is that bloke..

No offence, but Nic Johnson reminds me of him

What's the alternative; selling off NZ to the highest bidder so Boomers can make a fast buck for sitting on their asses, whilst selling out the younger generation of Kiwis! Are you out of your tiny little mind!

Moving out of Auckland to Dunedin and then expecting to just be able to move back to Auckland years later was always going to be a stupid idea. The provinces have never kept up with Auckland pricing and its logical that even if they went up at the same percentage, the houses in Dunedin were under half the price to start with so the gap in dollar terms just gets bigger and bigger. I wouldn't be blaming National, blame yourself for moving. Your never locked out of the housing market, its about life choices and some of those choices are not your "Gods given right" so harden up.

Actually National already did this BigBlue. That parent visa was frozen in 2017 I think.