Jacinda Ardern - our new PM

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#2048877 4-Jul-2018 11:54

networkn:

I maintain that not everyone in NZ should be able to buy a house. It's an entirely acceptable situation for those on lower incomes to rent.

That may be true, but it's also in my opinion a good "aspirational goal" and a good long term financial and lifestyle goal to own a home for many reasons - some of which can't be identified on a balance sheet.

We've had long-term series of economic / policy tweaking that's resulted in unaffordable housing and decreasing home ownership rates, and any expectation that this can be corrected quickly by the stroke of a pen is risking disaster.

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#2048881 4-Jul-2018 12:03

Fred99:

networkn:

I maintain that not everyone in NZ should be able to buy a house. It's an entirely acceptable situation for those on lower incomes to rent.

That may be true, but it's also in my opinion a good "aspirational goal" and a good long term financial and lifestyle goal to own a home for many reasons - some of which can't be identified on a balance sheet.

We've had long-term series of economic / policy tweaking that's resulted in unaffordable housing and decreasing home ownership rates, and any expectation that this can be corrected quickly by the stroke of a pen is risking disaster.

I agree that aspiring to it is one thing, but for a political party to implement a series of policies and give people "false" hope isn't great either.

Chances are if you can't afford to buy a home, you definately can't afford to OWN a home.

Buying it is only one cost, maintaining it for longevity is another.

We are in a reasonable financial position and our 12 year old home needs repainting on the top level and has done for 2 years. We have postponed the job 2 years because the quotes are 20K+, and whilst in a pinch I could do this if required, it's a significant sum

that means removing a number of other nice to haves, in order to manage. We budget around $10K a year in maintenance. We have spent well over that in the past 3 years. We are likely to push this out another year as not painting it won't do damage per se, just looks bad.

That doesn't even cover the repainting of the inside of the house which is likely to cost much more than that!

I can't imagine how people would manage this on smaller incomes.

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#2048888 4-Jul-2018 12:11

networkn:

Fred99:

networkn:

I maintain that not everyone in NZ should be able to buy a house. It's an entirely acceptable situation for those on lower incomes to rent.

That may be true, but it's also in my opinion a good "aspirational goal" and a good long term financial and lifestyle goal to own a home for many reasons - some of which can't be identified on a balance sheet.

We've had long-term series of economic / policy tweaking that's resulted in unaffordable housing and decreasing home ownership rates, and any expectation that this can be corrected quickly by the stroke of a pen is risking disaster.

I agree that aspiring to it is one thing, but for a political party to implement a series of policies and give people "false" hope isn't great either.

Chances are if you can't afford to buy a home, you definately can't afford to OWN a home.

Buying it is only one cost, maintaining it for longevity is another.

We are in a reasonable financial position and our 12 year old home needs repainting on the top level and has done for 2 years. We have postponed the job 2 years because the quotes are 20K+, and whilst in a pinch I could do this if required, it's a significant sum

that means removing a number of other nice to haves, in order to manage. We budget around $10K a year in maintenance. We have spent well over that in the past 3 years. We are likely to push this out another year as not painting it won't do damage per se, just looks bad.

That doesn't even cover the repainting of the inside of the house which is likely to cost much more than that!

I can't imagine how people would manage this on smaller incomes.

Valid point. Our home was built in 1992 and now needs substantial work to bring it to more modern standards - I expect to spend $100,000 on it within the next 12 months on roof renovations and other things. Buying a home is only the beginning of the process!

Houses are a bit like expensive motor cars: paying to get them from the dealer is one thing but having funds to service them and buy tyres at $700 each etc is quite another.

As I have observed before, politicians here have a tendency to see the problem from the wrong end: IMO we do not have a problem with what things cost as much as we have a problem with what people earn. Yes, many things cost too much here and that should be looked at.

However, I want to see a plan that actually accepts that something needs to be done to make NZ Inc a good deal wealthier and that requires far more sophisticated thinking than is being demonstrated by politicians at the moment.

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#2048889 4-Jul-2018 12:11

Do people actually think homes were easy to buy 30-40 years ago?

We have had housing issues for donkeys years, just like most other western countries. Thirty odd years ago houses may have been a little more affordable, but they were cheaply built compared to todays standards. Banks were scary and had extremely high standards for lending as they didnt have access to cheap overseas funds. At one point interest rates were 20%.

The main reason houses have become affordable is because it is easy to get huge mortgages and the media hype is immense almost demanding people buy houses at crazy prices even when they cannot afford them.

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#2048893 4-Jul-2018 12:14

networkn:

Don't forget that there is quite a bit of speculation in the building industry they can't build them for $650K, they will take a loss on lots of them.

"They" being the taxpayer, who is getting no benefit from subsidising all these houses in the first place...not even basic interest on the money that is being used.

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#2048896 4-Jul-2018 12:17

Pumpedd:

Do people actually think homes were easy to buy 30-40 years ago?

We have had housing issues for donkeys years, just like most other western countries. Thirty odd years ago houses may have been a little more affordable, but they were cheaply built compared to todays standards. Banks were scary and had extremely high standards for lending as they didnt have access to cheap overseas funds. At one point interest rates were 20%.

The main reason houses have become affordable is because it is easy to get huge mortgages and the media hype is immense almost demanding people buy houses at crazy prices even when they cannot afford them.

True. It is good that banks are being tighter about lending now.

One thing we could consider is a US style state mortgage system, using some of the money currently invested in the Cullen fund thing (for example) and having government backed lending at 30 year fixed rates. That would get rid of a lot of uncertainty and would be investing NZ money in NZ property.

Pumpedd

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#2048931 4-Jul-2018 13:08

Geektastic:

Pumpedd:

Do people actually think homes were easy to buy 30-40 years ago?

We have had housing issues for donkeys years, just like most other western countries. Thirty odd years ago houses may have been a little more affordable, but they were cheaply built compared to todays standards. Banks were scary and had extremely high standards for lending as they didnt have access to cheap overseas funds. At one point interest rates were 20%.

The main reason houses have become affordable is because it is easy to get huge mortgages and the media hype is immense almost demanding people buy houses at crazy prices even when they cannot afford them.

True. It is good that banks are being tighter about lending now.

One thing we could consider is a US style state mortgage system, using some of the money currently invested in the Cullen fund thing (for example) and having government backed lending at 30 year fixed rates. That would get rid of a lot of uncertainty and would be investing NZ money in NZ property.

We need to change our rental system totally and bring into line with other nations. Renting should be a viable option for living out your life in comfort.

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#2049047 4-Jul-2018 14:44

networkn:
I maintain that not everyone in NZ should be able to buy a house. It's an entirely acceptable situation for those on lower incomes to rent.

There is also a supply problem. Pretty lucky that some NZ landlords are mums and dads doing alright who can be very slow about increasing rents. Compared to the rampant market that it could be, but plenty of potential for chaos.

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#2049051 4-Jul-2018 14:48

@Pumpedd it has been many moons since I have rented but from what I have seen renting in NZ means a nomadic life style and moving at least yearly. That is not good.

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#2049057 4-Jul-2018 14:55

This seems to be true independent of income imo. Rising house prices tends to increase the chances you will be asked to move for sale in many areas.

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#2049064 4-Jul-2018 15:03

MikeB4: @Pumpedd it has been many moons since I have rented but from what I have seen renting in NZ means s nomdic life style and moving at least yearly. That is not good.

Exactly...so why doesnt any Government follow this a little further to get an outcome that is desirable.

We do need a permanent rental supply rather than most of our rentals being owned by mum and dad investors out for a quick buck.

If we had a rental system like overseas, a lot of pressure could come off our housing stock. It seems so stupid to invest billions of taxpayers dollars so that people with incomes the same as most MP's could enter the ballot to own.

I am not advocating state or social type rentals here but a rental system that offers a valid alternative to owning a home by all in the community.

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#2049086 4-Jul-2018 15:49

MikeB4: @Pumpedd it has been many moons since I have rented but from what I have seen renting in NZ means s nomdic life style and moving at least yearly. That is not good.

Well, it's a two edged sword. I had a fair number of circumstances changes in my late teens early twenties, so renting was great for me (and not great too depending on landlord).

I do know a lot of renters like my uncle who has lived in the same house 10+ years.

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#2049106 4-Jul-2018 16:22

Seems to be crazy that you cannot build an affordable 2 bedroom townhouse type for $650k. Twyford was talking $600k for 1 bedroom units which is absurd.

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#2049110 4-Jul-2018 16:24

Pumpedd:

Seems to be crazy that you cannot build an affordable 2 bedroom townhouse type for $650k. Twyford was talking $600k for 1 bedroom units which is absurd.

Wait, what? The $650K ones are not 3 Bedrooms? I thought they were?

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#2049138 4-Jul-2018 16:47

MikeB4:

@Pumpedd it has been many moons since I have rented but from what I have seen renting in NZ means a nomadic life style and moving at least yearly. That is not good.

We've been renting our apratment for close to two years. Leaving later this year of our own volition (because we bought our own apartment).

Mike

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