Sunday, 28 July 2013

Labour's New Housing Policy

Labours’ radical and discriminatory new housing policy is not only racist, but it would be totally ineffective. 
Most foreign home buyers in New Zealand are Australian (exempt from this policy), and English. The total is less than 5 per cent, so the rampant Asian uptake is a delusion. Most are New Zealand residents, and they are a small proportion of a tiny proportion of New Zealand home buyers. The cost of policing such a wild scheme would far outweigh any benefit to the market, which is dubious at best. This is an absolute policy gaff, a populist vote catching scheme stolen off Winston Peters in a moment of blind panic by Labour. What are they thinking? They aren’t thinking at all. The only thing that will slow this market is a lot more cheap Auckland housing & the completion of the Christchurch rebuild. Both will take a few years, so no change in the foreseeable future no matter what the politicians say or do.
The heat is on in Auckland for sure. The rest of the New Zealand market is basically business as we have known it for some time now, short on stock, plenty of buyers and only a little capital growth.

Thursday, 25 July 2013

What a Strange Market we are in

What a very strange market we are in. I have not seen the exact like in 25 years. Fact is the New Plymouth market is very steady, with very slow capital growth across the board. Pretty much flat as far as values go, but some small increases. That’s about as perfect as it gets in terms of stability and certainty. Added to that we see historically low interest rates. This makes the cost of borrowing as low as it has ever been in New Zealand. Quite obviously this suits buyers. They have confidence and they have cheap money, a winning combination. These conditions should also suit sellers. We have price stability, we have buyers willing and able to commit. It’s a great combination. But, there is a strange and unusual issue that I can’t figure out. There is no rhyme nor reason for, or any disadvantageous situation, that would stop people selling houses. The climate is right, it’s never been more right. The fact is though, that properties available to buy on the New Plymouth market are at a historic low as well. We simply do not have houses to sell our many genuine buyers, right across the price and location spectrum. In greater NP there should be 400-500 properties for sale at any one time, give or take. At present in the whole of our NP area, including NP, Bell Block & Oakura there are 200. Less than half the norm of the past 20 years. Why? I have no idea, I’m flummoxed, it makes no sense.
There are some distinct advantages for sellers in this anomalous situation. Lots of buyers, shortage of houses. How do we take advantage of that? We auction whenever possible. Our auction sales at present are running hot. Very few have less than 3, and often up to 5 or 6 bidders. Buyers compete and sellers benefit. Our auctions are running at 100% at present. Thinking about a property sale soon? Take the advantage, now is the very best time to make the best possible move and auction your property now. We have had stock shortages before from time to time, nothing quite as pronounced as now, but the dam busts after a while. Soon (who knows when -  a week, a month, maybe 6?), some sellers will be forced to act. It is inevitable. Then a flood of sellers will come to the market at once, restoring the historical balance, and this particular sellers advantage will be gone. Give it some thought.
John Christiansen