Real estate, post COVID-19 level 4 (since 2020)

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#2756832 8-Aug-2021 18:10

tdgeek:

Tell me what measures undertaken NOW, will restore house prices and affordability in 12 months. I can answer that, ZERO

DTIs and targeted property taxes could have a major effect. But the government has ruled out any new taxes, so are just kicking the can down the road, and I can see they will roll over on the new ute tax too, as farmers are not happy.

There are plenty of things that could be done, but many of the tough decisions are political suicides. We are in this current situation because of a lack of investment in infrastructure, and not bringing in the policies that were needed, and new home buyers and FHBs are now paying the costs.

Even all the houses now being build, many are not for people to buy, they are for investors who are going to rent them out, decreasing the percentage of home ownership, which could have the effect of keeping supply low, and pushing up house prices, which then pushes up rents. Just look at the Kiwibuild website and they are down to just a few developments left, mainly because there is little money in it for developers, compared to what they can get privately. IMO there are too many people with vested interests in property to upset the apple cart.

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#2756845 8-Aug-2021 18:18

mattwnz:

DTIs and targeted property taxes could have a major effect. But the government has ruled out any new taxes, so are just kicking the can down the road, and I can see they will roll over on the new ute tax too, as farmers are not happy.

There are plenty of things that could be done, but many of the tough decisions are political suicides. We are in this current situation because of a lack of investment in infrastructure, and new home buyers are now paying the costs.

So, what of these suggestions will fix everything now?? So, in 3 months I/we/everyone can enjoy easy prices? NONE. you get that when every Govt kicks the can. You need to avoid the blame culture and look long term past. If you dont maintain your house for decades you can't blame last year. Which is what us happening now.

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#2756850 8-Aug-2021 18:26

tdgeek:

Why would any bank fix for yonks? Thats unrealistic. Pay todays prices, pay back at todays prices

Because they can. They package your debt as a long term bond and resell it while keeping the margin. It's not rocket science.

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#2756854 8-Aug-2021 18:37

Handle9:

Because they can. They package your debt as a long term bond and resell it while keeping the margin. It's not rocket science.

Cool, then all banks can give everyone 2.69% mortgages for 25 years today. Somehow I dont think that will happen. Which is why banks are not giving rates for long terms.

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#2756855 8-Aug-2021 18:37

tdgeek:

Handle9:

Because they can. They package your debt as a long term bond and resell it while keeping the margin. It's not rocket science.

Cool, then all banks can give everyone 2.69% mortgages for 25 years today. Somehow I dont think that will happen. Which is why banks are not giving rates for long terms.

Lol.

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#2756860 8-Aug-2021 18:47

Handle9:

Lol.

Yeah lol. Maybe you can try contributing for a change, instead of the usual combatitive attitude. Im sure you have a lot you can contribute, but you rarely ever do.

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Handle9

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#2756862 8-Aug-2021 18:49

tdgeek:

Handle9:

Lol.

Yeah lol. Maybe you can try contributing for a change, instead of the usual combatitive attitude. Im sure you have a lot you can contribute, but you rarely ever do.

I gave your contribution the response it deserved. It was funny.

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#2756868 8-Aug-2021 19:27

Handle9:

I gave your contribution the response it deserved. It was funny.

I regard your "contribution" as shallow. But I wont buy into your games, given the regularity your posts end up as 4 page arguments with varying people here.

If "They package your debt as a long term bond and resell it while keeping the margin" why can they not provide the long term low interest rate? Why do the banks not do that? Im sure many would regard a 25 year mortgage at 2.69% + margin as favourable. Given that "They package your debt as a long term bond and resell it while keeping the margin"

I guess you can regard my post as funny. Its hard to assess your posts as they very rarely actually contribute.

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#2756870 8-Aug-2021 19:28

tdgeek:
Handle9:

I gave your contribution the response it deserved. It was funny.

I regard your "contribution" as shallow. But I wont buy into your games, given the regularity your posts end up as 4 page arguments with varying people here.

If "They package your debt as a long term bond and resell it while keeping the margin" why can they not provide the long term low interest rate? Why do the banks not do that? Im sure many would regard a 25 year mortgage at 2.69% + margin as favourable. Given that "They package your debt as a long term bond and resell it while keeping the margin"

I guess you can regard my post as funny. Its hard to assess your posts as they very rarely actually contribute.

Whatever.

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#2756873 8-Aug-2021 19:33

Handle9:

Whatever.

You got that right, but unfortunately, factual.

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#2756882 8-Aug-2021 19:46

My 2c, short of 100,000 new houses being built and coming onto the market in the next 6-12 months I can't see too much movement in prices myself.

And building that many houses would take ages, way longer than a year anyway. We would need a large number of builders to build that many, and my uneducated guess is we don't have that many in the country right now.

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mattwnz

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#2756924 8-Aug-2021 23:32

tdgeek:

Handle9:

Because they can. They package your debt as a long term bond and resell it while keeping the margin. It's not rocket science.

Cool, then all banks can give everyone 2.69% mortgages for 25 years today. Somehow I dont think that will happen. Which is why banks are not giving rates for long terms.

One thing is that banks in NZ charge far more in interest than the same banks do in Oz. Look at the longer term fixed rates between Oz and NZ. These low 1 year rates aren't likely what people are going to be paying longer term as rates rise. So they are making a lot more profit. But why would a bank say that they removed the 7 year term, which I understand was only done a few months ago, due to them claiming that it was unpopular. When I am sure it will be a lot more popular now as rates head their way up, and people want to lock in the cheaper rates. We don't really know how quickly the reserve bank will raise rates, as it is largely about inflation. I understand they must keep inflation within the 1-3% band.

In the US they have hedge funds buying up houses, and in the UK banks are buying up houses, to then become landlords. I guess we are lucky that isn't happening here, as then it would also be hedge funds competing against FHBs and mum and dad investors. I wonder what the situation will be like in 50 years. I wonder if NZ will be largely a country of renters. To go from 25% to 33% of houses being rentals in less than 30 years is very significant.

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#2756936 9-Aug-2021 07:13

mattwnz:

In the US they have hedge funds buying up houses, and in the UK banks are buying up houses, to then become landlords. I guess we are lucky that isn't happening here, as then it would also be hedge funds competing against FHBs and mum and dad investors.

Here we have something slightly different: A government that can't build state houses fast enough bidding against aspiring home owners on the open market for the same houses.

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#2757029 9-Aug-2021 11:21

GV27:

mattwnz:

In the US they have hedge funds buying up houses, and in the UK banks are buying up houses, to then become landlords. I guess we are lucky that isn't happening here, as then it would also be hedge funds competing against FHBs and mum and dad investors.

Here we have something slightly different: A government that can't build state houses fast enough bidding against aspiring home owners on the open market for the same houses.

But Megan Woods categorically refuted this on the news a few days ago. They aren't buying houses already under construction by private developers then taking the credit for adding to supply, no sir, not on your nelly. I for one believe her!

Crap, my sarcasm meter just went off the scale 🤣

heavenlywild

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#2757031 9-Aug-2021 11:25

On another note who thinks the OCR will be increased by 25 points this week?

With Aussie under lockdown and us being one delta case away from the same, the increase may not be a done deal just yet.

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