Electoral Party most likely to do something about Auckland housing bubble?

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#1538238 22-Apr-2016 16:39

I think if it were easier to get into the major areas of employment from further out, it would ease the pressure a bit, as would a willingness for slightly longer commuting times. I watch a lot of Location, Location, Location, and those people often put their acceptable commute at around an hour. Because of the comprehensive rail system, they can commute quite a distance in that space of time. Even back in the 50's, my Mum worked in London with someone who used to commute from somewhere on the south coast every day. It's just become accepted there that you need to live further out and travel a little bit longer. Regular, fast rail links would be a good start, and not just Len's toy train set chugging around central Auckland.

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#1538251 22-Apr-2016 17:10

In Melbourne many people work long hours say 8am to 5pm, with the average commute being 90 mins one way. Then there are those who work 7am to 6pm .... !!!

Remember that city tops the most liveable city chart annually.

Perhaps Aucklanders will get used to that soon.

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#1538254 22-Apr-2016 17:13

That in mind, there must be other cities where the living conditions and commute are far worse.

That means those people see Auckland, as it currently is, as heaven. Guess why they flock to Auckland. A minority do find the rat race meaningless and those move out to smaller places for the lifestyle.

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#1538285 22-Apr-2016 17:34

wsnz:

Any Government responsible for a sizable correction in the housing market would be turfed out of office at the next election. The reality will bite when a sizable proportion of equity in their home is wiped off the balance sheet.

What people actually want is everybody else's house to decline in value in order to make housing more affordable; They do not want theirs touched!

This is called "magical thinking" by psychologists.

It is commonly found in compulsive gamblers, and in Auckland house buyers.

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#1538289 22-Apr-2016 18:10

joker97: In Melbourne many people work long hours say 8am to 5pm, with the average commute being 90 mins one way. Then there are those who work 7am to 6pm .... !!!

Remember that city tops the most liveable city chart annually.

Perhaps Aucklanders will get used to that soon.

I'm in Melbourne. It's not uncommon for my day to look something like:

7-8am: Conference call from home
8-9am: Drive to work. 9.5kms takes somewhere between 40 and 75 minutes (50 is about normal).
9am-5:30pm: At office
5:30-6:30pm: Drive home
9-10/11pm: Conference call from home

Sometimes I am lucky and only have to do call(s) at one end of the day. Sometimes I get really lucky and have none!

Sometimes I work from home, and that's more like:
7am-11pm: Work. Maybe an hour or two somewhere in the middle for food/popping out to do something

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#1538307 22-Apr-2016 18:40

So what are the implications if the Reserve Bank ratcheted up the OCR to say 6-7%? I was working at Westpac about that time, some fixed loans were still over 10%.

Not as a mechanism to quell inflation but just lift mortgage rates.

Someone else mentioned it was political suicide, maybe now, but what about another 30 years, where the renters are suddenly the majority of the voters?

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#1538317 22-Apr-2016 19:03

ajobbins:
joker97: In Melbourne many people work long hours say 8am to 5pm, with the average commute being 90 mins one way. Then there are those who work 7am to 6pm .... !!!

Remember that city tops the most liveable city chart annually.

Perhaps Aucklanders will get used to that soon.

I'm in Melbourne. It's not uncommon for my day to look something like:

7-8am: Conference call from home
8-9am: Drive to work. 9.5kms takes somewhere between 40 and 75 minutes (50 is about normal).
9am-5:30pm: At office
5:30-6:30pm: Drive home
9-10/11pm: Conference call from home

Sometimes I am lucky and only have to do call(s) at one end of the day. Sometimes I get really lucky and have none!

Sometimes I work from home, and that's more like:
7am-11pm: Work. Maybe an hour or two somewhere in the middle for food/popping out to do something

Very lucky to live 9.5ks from home. Melbourne is what 50kms diameter? So the average person could travel 20,25ks. Of course some live nearer to work, some farther.

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#1538318 22-Apr-2016 19:04

mudguard:
So what are the implications if the Reserve Bank ratcheted up the OCR to say 6-7%? I was working at Westpac about that time, some fixed loans were still over 10%.

Not as a mechanism to quell inflation but just lift mortgage rates.

Someone else mentioned it was political suicide, maybe now, but what about another 30 years, where the renters are suddenly the majority of the voters?

Easy. All farmers bankrupt. The ocr is for farmers and farmers.

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#1538319 22-Apr-2016 19:04

I meant dairy farmer

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#1538322 22-Apr-2016 19:13

Guys! I'm outside having a cold one and my inbox is overheating! But it is a very good topic I'll catch up soon!

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#1538324 22-Apr-2016 19:16

The thing I find interesting is that rents are not increasing anywhere near as fast as house prices. Rents can only go as high as people can incomes allow, whereas house price rises are theoretically unlimited as long as people are buying and selling in the same market.

This means that the only way you can get an acceptable yield on residential property is if you're getting ongoing capital gains well in excess of inflation. Can that continue forever? Probably not.

People who buy into residential housing shortly before the capital gains dry up are going to be the big losers here.

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#1538325 22-Apr-2016 19:19

mudguard:
So what are the implications if the Reserve Bank ratcheted up the OCR to say 6-7%? I was working at Westpac about that time, some fixed loans were still over 10%.

Not as a mechanism to quell inflation but just lift mortgage rates.

Someone else mentioned it was political suicide, maybe now, but what about another 30 years, where the renters are suddenly the majority of the voters?

Interest rates aren't just for homes.

Asian immigrants. They are wealthy. How much is a house? 500k. Oh ok here is a cheque. 927660? Oh ok her is a cheque. To me there are many issues. Start with CGT and no foreign non resident buyers that's all fair and a start

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#1538327 22-Apr-2016 19:21

alasta:
The thing I find interesting is that rents are not increasing anywhere near as fast as house prices. Rents can only go as high as people can incomes allow, whereas house price rises are theoretically unlimited as long as people are buying and selling in the same market.

This means that the only way you can get an acceptable yield on residential property is if you're getting ongoing capital gains well in excess of inflation. Can that continue forever? Probably not.

People who buy into residential housing shortly before the capital gains dry up are going to be the big losers here.

Yep, for every person that made 100k tax free there is another that lost or will do.

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#1538331 22-Apr-2016 19:25

TeaLeaf:

I think its pretty obvious the Government is maintaining this bubble. Yes a correction will hurt, but its beyond needed imo as its now impacting/lowering prices of property elsewhere and so much more, ie pricing essential trades out of the city like has happened in London. Imo the bubble was driven firstly by empty home buyers and a lack of capital gains tax and secondly by Aucklanders jumping on the bandwagon thinking they were getting rich for nothing. Neither of which I have an opinion on.

I'm always interested to know why people think a CGT will have any effect on property prices when there isn't a single place this has worked anywhere in the world.

Yes we should have a CGT simply because it brings fairness to the tax system. It however will have no effect on property prices.

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#1538334 22-Apr-2016 19:33

sbiddle:
TeaLeaf:

I think its pretty obvious the Government is maintaining this bubble. Yes a correction will hurt, but its beyond needed imo as its now impacting/lowering prices of property elsewhere and so much more, ie pricing essential trades out of the city like has happened in London. Imo the bubble was driven firstly by empty home buyers and a lack of capital gains tax and secondly by Aucklanders jumping on the bandwagon thinking they were getting rich for nothing. Neither of which I have an opinion on.

I'm always interested to know why people think a CGT will have any effect on property prices when there isn't a single place this has worked anywhere in the world.

Yes we should have a CGT simply because it brings fairness to the tax system. It however will have no effect on property prices.

We had a rental. Yay. If CGT came in that's a hit to to value of a rental. If that tax free gain disappeared
That may free up properties to live in and not invest in?

So less denand from non live in it purchasers? That's not a fix but I feel there are many small fixes that can help. Resident purchasers is another easy fix. I've seen students in a flash house, devoid of furniture . Non resident parents.

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