Geekzone: technology news, blogs, forums
Guest
Welcome Guest.
You haven't logged in yet. If you don't have an account you can register now.
View this topic in a long page with up to 500 replies per page Create new topic
1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | 13 | 14 | 15 | 16 | 17 | 18 | 19 | 20
7193 posts

Uber Geek
+1 received by user: 3752


  Reply # 2084162 5-Sep-2018 08:30
Send private message quote this post

xlinknz:

 

I agree but a market correction will affect property too.

 

 

And vice versa.

 

There seem to be plenty of clickbait headlines warning of impending market meltdowns. Although I think they'll probably be proven right eventually, deep analysis attempting to explain why the present conditions may lead to that eventuality are all probably wrong. "Fundamentals" aren't the cause - human greed, fear, and panic are.  We'll see.  I think being leveraged on property is a very dumb idea at the moment - but OTOH I've believed that's been the case for at least 5 years, and oh - how very wrong I've been on that.




3918 posts

Uber Geek
+1 received by user: 824


  Reply # 2084173 5-Sep-2018 09:10
Send private message quote this post

I get the feeling reading all this that I'll probably never own a house now - not in Auckland anyway, at least.

281 posts

Ultimate Geek
+1 received by user: 160


  Reply # 2084198 5-Sep-2018 10:08
Send private message quote this post

quickymart: I get the feeling reading all this that I'll probably never own a house now - not in Auckland anyway, at least.

 

 

 

This suggest and pre-tax income of $240K to by a median priced house in Auckland. However not many people would be looking at $1.2Mn homes for first homes. If you're in that category you most likely are already on the property ladder with quite a bit of equity in your current home. First homes buyer in Auckland are probably looking for something in the 600-800K mark.

 

https://www.yudu.co.nz/news/here-s-how-much-you-need-to-earn-to-buy-a-house-in-nz/39379/

 

Although I question the use of 30% of pre-tax income as a level of stress test. Plenty of people are paying more than 30% on rent let alone a mortgage.


2317 posts

Uber Geek
+1 received by user: 655


  Reply # 2084241 5-Sep-2018 10:58
Send private message quote this post

Senecio:

 

quickymart: I get the feeling reading all this that I'll probably never own a house now - not in Auckland anyway, at least.

 

 

 

This suggest and pre-tax income of $240K to by a median priced house in Auckland. However not many people would be looking at $1.2Mn homes for first homes. If you're in that category you most likely are already on the property ladder with quite a bit of equity in your current home. First homes buyer in Auckland are probably looking for something in the 600-800K mark.

 

https://www.yudu.co.nz/news/here-s-how-much-you-need-to-earn-to-buy-a-house-in-nz/39379/

 

Although I question the use of 30% of pre-tax income as a level of stress test. Plenty of people are paying more than 30% on rent let alone a mortgage.

 

 

I assume the listed median incomes are for individuals, but generally it will be a couple buying a house and will usually have two incomes.

 

If that's the case for many potential buyers in many regions the problem isn't so much servicing the mortgage as it is saving the deposit. Difficult for most people to save that sort of money while they are also paying rent.

 

We were lucky enough to get a low interest loan from family to cover the bulk of the deposit, which we paid back over 5 years. This meant we had the mortgage itself interest-only for the first 5 years while we paid off the deposit. However, there is no way we could have afforded this in the Auckland market.

 

The other thing was buying within our means to be able to service the loans, which meant purchasing at the lower end of the market.

 

I sound like an old man, but I do think a lot of younger couples in the property market are expecting their first home to be their "dream home".


4952 posts

Uber Geek
+1 received by user: 2010


  Reply # 2084266 5-Sep-2018 11:59
One person supports this post
Send private message quote this post

It also has to be said that high property prices in many places, reflect a high level of contention for the available properties.  Put simply there are too many people who want to live in Auckland, Tauranga, Queenstown etc. In normal circumstances this would stimulate more supply. But, supply is artificially constrained by regulation.

 

The resulting increase in the cost of housing is what  anyone who did Econ101 would predict.

 

The market is not only working - it's screaming from the rooftops "go and live somewhere else".





Mike

2527 posts

Uber Geek
+1 received by user: 970

Lifetime subscriber

  Reply # 2084268 5-Sep-2018 12:06
One person supports this post
Send private message quote this post

MikeAqua:

 

It also has to be said that high property prices in many places, reflect a high level of contention for the available properties.  Put simply there are too many people who want to live in Auckland, Tauranga, Queenstown etc. In normal circumstances this would stimulate more supply. But, supply is artificially constrained by regulation.

 

The resulting increase in the cost of housing is what  anyone who did Econ101 would predict.

 

The market is not only working - it's screaming from the rooftops "go and live somewhere else".

 

 

So true. And trying to artificially defeat supply and demand is just consigning oneself to a lifetime of failure. For example, increasing supply of cheap finance just increases demand so prices go up even more.

 

So listen to Mike and go to Nelson. I hear it's always sunny there.

 

 


275 posts

Ultimate Geek
+1 received by user: 62


  Reply # 2084275 5-Sep-2018 12:26
3 people support this post
Send private message quote this post

I moved to NZ from the UK in 2010 as my kiwi wife got homesick and wanted to come home. All my savings (small as they were) went on the move, paying off debts and financing my wife's study to get her dream job with the spca. While we saved money where we could, we rented in auckland as its where we both work. 2 Years ago my son was born who is special-needs. He needs to be in close contact with Starship hospital and other local specialists (all 10 of them) at all times, so now I'm stuck in Auckland if I like it or not. Because my wife had to give up her job to become a full time carer for the boy, I bring in the only income. If I cut out all minor things like netflix etc. as people suggest, if all that remained went to savings the amount saved wouldn't keep up with the ever increasing deposit amount that I require. If I took it further and cut out all forms of insurance (too risky to do this) and travel costs, I still wouldn't have enough. The medical care system pays for nearly all of the boys treatment but the additional costs of travel and catering for his needs takes a chunk of my disposable income. My landlord is fantastic and has never raised my rent in the 8 years I've been here and I've told him I'm staying there until the day he kicks me out so I can keep saving against the low rent. But I have accepted that it's a race that I cannot win, I have a need to save money for a buffer for my sons future treatments more than I have a need to buy property. Some treatments for his condition are on the horizon that I anticipate will not be funded by pharmac. The combination of these scenarios means that my only option for buying a home here (for me to live in) is to work harder and get promoted faster or move in the job market to a higher position. Any increase I get now will go straight into saving. Doing this while supporting a family and coping with a child on chemo fighting an incurable condition takes it's toll. Not all people are in my position but even taking out the medical aspect, for those who don't have family support or multiple incomes, who are starting late in life from a low savings balance, the concept of 'cutting luxury things out' seems like one spouted by those who have no idea what being in this position is like.





4055 posts

Uber Geek
+1 received by user: 710

Trusted
Subscriber

  Reply # 2084276 5-Sep-2018 12:29
Send private message quote this post

Paul1977:

 

I assume the listed median incomes are for individuals, but generally it will be a couple buying a house and will usually have two incomes.

 

 

This sounds like a bit of an outdated stereotype. There are a lot of people who are under housing stress because they don't have a partner, can't afford to live alone, and are too old to go flatting. 


281 posts

Ultimate Geek
+1 received by user: 160


  Reply # 2084277 5-Sep-2018 12:30
Send private message quote this post

MikeAqua:

 

The market is not only working - it's screaming from the rooftops "go and live somewhere else".

 

 

That is exactly what my wife and I plan to do. We're Auckland based for now out of necessity to be in a populated area for employment. We're in our mid 40's with no kids and no family in Auckland so nothing to keep us here apart from employment. We arrived last April and bought in June at eye watering levels compared to Brisbane where we had just sold. Thankfully through our previous homes capital appreciation we could stump up ~60% of the value as a deposit. We earn good money but I wouldn't like to be paying off a mortgage on 80% of an Auckland property even on our income. Our fist home in Brisbane in 1999 cost us $109K AUD at the time!

 

The key for us to leave Auckland will be to find an alternative form of income. I work in FMCG manufacturing so that is very population centered. The plan is to get ourselves in a position with enough equity in our current property to sell up in the next 5-7 years and head to the country where we could buy without a mortgage. If we can make this happen then I can step out of the corporate world and find employment locally wherever we end up knowing I don't have to service a mortgage.

 

That's the plan anyway.


2317 posts

Uber Geek
+1 received by user: 655


  Reply # 2084283 5-Sep-2018 12:44
Send private message quote this post

alasta:

 

Paul1977:

 

I assume the listed median incomes are for individuals, but generally it will be a couple buying a house and will usually have two incomes.

 

 

This sounds like a bit of an outdated stereotype. There are a lot of people who are under housing stress because they don't have a partner, can't afford to live alone, and are too old to go flatting. 

 

 

I don't deny that their are a lot of single people in that position, but I'd still wager well over 50% of prospective home buyers would be in a relationship (I have no stats to back that up though).


2527 posts

Uber Geek
+1 received by user: 970

Lifetime subscriber

  Reply # 2084294 5-Sep-2018 13:04
One person supports this post
Send private message quote this post

fizzychicken:

 

I moved to NZ from the UK in 2010 as my kiwi wife got homesick and wanted to come home. All my savings (small as they were) went on the move, paying off debts and financing my wife's study to get her dream job with the spca. While we saved money where we could, we rented in auckland as its where we both work. 2 Years ago my son was born who is special-needs. He needs to be in close contact with Starship hospital and other local specialists (all 10 of them) at all times, so now I'm stuck in Auckland if I like it or not. Because my wife had to give up her job to become a full time carer for the boy, I bring in the only income. If I cut out all minor things like netflix etc. as people suggest, if all that remained went to savings the amount saved wouldn't keep up with the ever increasing deposit amount that I require. If I took it further and cut out all forms of insurance (too risky to do this) and travel costs, I still wouldn't have enough. The medical care system pays for nearly all of the boys treatment but the additional costs of travel and catering for his needs takes a chunk of my disposable income. My landlord is fantastic and has never raised my rent in the 8 years I've been here and I've told him I'm staying there until the day he kicks me out so I can keep saving against the low rent. But I have accepted that it's a race that I cannot win, I have a need to save money for a buffer for my sons future treatments more than I have a need to buy property. Some treatments for his condition are on the horizon that I anticipate will not be funded by pharmac. The combination of these scenarios means that my only option for buying a home here (for me to live in) is to work harder and get promoted faster or move in the job market to a higher position. Any increase I get now will go straight into saving. Doing this while supporting a family and coping with a child on chemo fighting an incurable condition takes it's toll. Not all people are in my position but even taking out the medical aspect, for those who don't have family support or multiple incomes, who are starting late in life from a low savings balance, the concept of 'cutting luxury things out' seems like one spouted by those who have no idea what being in this position is like.

 

 

Man that does sound tough. I think when people (like me) say, from their comfortable position, "cut out the luxuries" etc, it is directed not at you, or solo parents, but at the stereotyped, entitled millennial couple with two incomes and no kids. For them it should be a lot easier.

 

The fact that you can do it hard, but get by despite your income restricted, options restricted and expenses increased, it confirms my "prejudice" that aforesaid entitled millennials don't know how bloody lucky they are, and should stop whinging and get on with saving.

 

 


4952 posts

Uber Geek
+1 received by user: 2010


  Reply # 2084309 5-Sep-2018 13:34
Send private message quote this post

kryptonjohn:

 

So listen to Mike and go to Nelson. I hear it's always sunny there.

 

 

Nelson is overpriced too, you don't want to come here.  Also, while it's sunny often.  If it isn't sunny, it's raining.

 

Nelson has a real constraint - minimal land left suitable for building.  Basically down to infill and cheap/nasty sub-divisons in unfavourable locations. 

 

 

 

 





Mike

625 posts

Ultimate Geek
+1 received by user: 117


  Reply # 2084379 5-Sep-2018 14:57
Send private message quote this post

I wonder if they simply changed and non owner-occupied housing so that you had to borrow at commerical rates? Would many go and spend the same money?

 

I love some of the comments on a recent Stuff article, oh move to another town. That's fine. My income would halve! So I'd be in the same boat. No one moves to the big centres for the lifestyle, they move there because there are jobs. 


706 posts

Ultimate Geek
+1 received by user: 17


  Reply # 2084409 5-Sep-2018 15:45
Send private message quote this post

Early last year I made the decision to sell up in Auckland and move to the Gold Coast. Not for everyone I know but I was in fortunate to secure a transfer of sorts with my employer.

 

One year later my wife and I own two properties on the Gold Coast. One is an investment property. looking back it was the best thing I ever did financially. Selling in a high Auckland market and buying in a much slower QLD market. You get a lot more bang for your buck so to speak.

 

Interest rates are low - ours is 3.69% floating

 

Minimum deposit is 10%

 

Incomes are on average a little higher I would say. Your employer pays 9.5% of your annual income into Superannuation - by law, this is said to increase.


14276 posts

Uber Geek
+1 received by user: 1848


  Reply # 2084411 5-Sep-2018 15:48
Send private message quote this post

MikeAqua:

 

It also has to be said that high property prices in many places, reflect a high level of contention for the available properties.  Put simply there are too many people who want to live in Auckland, Tauranga, Queenstown etc. In normal circumstances this would stimulate more supply. But, supply is artificially constrained by regulation.

 

The resulting increase in the cost of housing is what  anyone who did Econ101 would predict.

 

The market is not only working - it's screaming from the rooftops "go and live somewhere else".

 

 

 

 

Wellington also seems to eventually follow and nearly match the price rises in Auckland, especially as Wellington seem to have just as high incomes. I recall in themid 2000's the prices of houses in Auckland vs Wellington weren't that much different. But I think the E/Q risk in Wellington does put a lot of people off, esp the overseas investors.  I think Auckland prices are, in terms of your average house being a million dollars, is largely based on it's lands future potential value. Didn't a row of 4 of the 'the block' houses get bulldozed, and the land used for building apartments? That sort of intesification is only going to happen more and more, and people with standalone houses will likely be forced to sell as the values and rates go up significantly. It is a double edged sword.


1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | 13 | 14 | 15 | 16 | 17 | 18 | 19 | 20
View this topic in a long page with up to 500 replies per page Create new topic

Twitter »

Follow us to receive Twitter updates when new discussions are posted in our forums:



Follow us to receive Twitter updates when news items and blogs are posted in our frontpage:



Follow us to receive Twitter updates when tech item prices are listed in our price comparison site:



Geekzone Live »

Try automatic live updates from Geekzone directly in your browser, without refreshing the page, with Geekzone Live now.



Are you subscribed to our RSS feed? You can download the latest headlines and summaries from our stories directly to your computer or smartphone by using a feed reader.

Alternatively, you can receive a daily email with Geekzone updates.