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Treasury Secretary says Canterbury earthquake likely to cost about NZ$4 bln in total
The Canterbury Earthquake could ultimately cost about NZ$4 billion, Treasury Secretary John Whitehead has reportedly said.
Both Fairfax's Stuff website and TV3's website are carrying reports quoting Whitehead.
According to Stuff, Whitehead said the NZ$2 billion figure previously used only covers the Earthquake Commission 's liabilities. Treasury's estimate of the total cost to householders, insurance companies, businesses and taxpayers was, in fact, probably nearer double that.
The Earthquake Commission is advising that 29,678 claims have been received as at mid-day today, 24,390 from within Christchurch City.
"The cost faced by the EQC, individuals, and insurance costs will probably be of the order of NZ$4 billion," Mr Whitehead said.
In terms of the economic impact it was early days, "but the pattern of these is certainly a short term drop in activity of businesses being unable to function and ... there's always a risk of businesses failing.
"In the slightly longer term when you've got that reconstruction effort, a big amount of that going on tends to raise GDP (gross domestic product)."
Related Topics
But Mr Whitehead stressed that there were a "very wide range of estimates" on costs at the moment because officials were still to "get down to what's actually happened on the ground".
48 Comments
God for 2010, give us Kiwis a
God for 2010, give us Kiwis a nice, most needed Christmas present, import more money printing machines and this time make them accessible for the wider public in the big cities and please more slot machines for the rural communities - slide in one $ get $$ - great as a past time activity and to double the money.
What I noticed we businesses/ people increasingly earn less – the government get increasingly less revenue – but ask increasingly for more money from us - and increasingly spends more.
We are increasingly.........
Have a look at the amounts
Have a look at the amounts that the financial sector takes off us....Some of Steve Keen's work suggest that its the financial ponzi scheme thats killing the workers, middle class and businesses...incomes...
regards
What is the url at the bottom
What is the url at the bottom of the photo? Would like to be able to see a bigger photo thanks.
Looks something
Looks something like:
http://images.geonet.org.nz/maps/quakes/Wln-christchurch-earthquake.jpg
That's not 100%, very hard to see, but it looks as if you need a Geonet login to get at those pics anyway.
http://images.geonet.org.nz/m
http://images.geonet.org.nz/maps/quakes/262-christchurch-quake.jpg
Thanks for this.
Thanks for this.
Here the link:
Here the link: http://www.geonet.org.nz/earthquake/drums/ just click the region.
To the chinese the number 4
To the chinese the number 4 is a sign of bad luck.
The event happened on the 4th.
On the 4th hour.
The cost of 4 billion.
But when did treasury get anything write?
More like 7 billion.
What does everyone think will
What does everyone think will happen to house prices in chch?
Not much, becuase I don't
Not much, becuase I don't think anyone will really be buying or selling for some time, apart from moving out of the area. It may boast sales in some other regions that aren't high EQ zones.
Reading the insurance stuff
Reading the insurance stuff on stuff there would be a risk that there is hidden damage and that wouldnt be coverd by insurance on a property going fward...
There will be a housing shortage for 2 years? in which case I assume prices will rise but then start to fallback...I wouldnt buy today myself..
regard
I'm sure the drop in property
I'm sure the drop in property values is not included in this estimate and will be even more than $4 Billion
Chch had approx 150,000 houses at average price of $350K = approx $50B worth on 3rd Sept
If average selling price just drops 10% that's $5B less equity ... and prices could drop much more.
There are already a few places for sale on Trademe asking up to 40% below CV + $1 reserve auctions
http://www.trademe.co.nz/Trade-me-property/Residential-property/Houses-for-sale/auction-316345019.htm
http://www.trademe.co.nz/Trade-me-property/Residential-property/Houses-for-sale/auction-316344559.htm
I guess there could be a flood of bargins like this if aftershocks continue much longer. e.g.
My cousin has bought her kids up to Nelson so they can destress + get some sleep (their house is fine btw).
My boss (based in Chch) has taken his family to Brisbane for a week to recover (house pretty badly damaged).
My mother in law in Chch hasn't slept for 3 nights (no damage at her place).
When people are this stressed and exhausted some will just want out at any price - especially if they've lost jobs etc.
e.g. 5 years after hurricane Katrina the population of New Orleans has dropped by approx 20%
http://www.chicagotribune.com/news/sc-nw-0829-katrina-gfc.eps-20100827,0,4833461.graphic
Most of the reduction is due to low income people who were renting who left the city ... now there are around 40,000 empty houses in New Orleans. I don't expect Christchurch will be this bad, but maybe population could drop by 5-10%
What do others think will happen to Chch population?
It will go back to
It will go back to normal....might take 2 years......
regards
By then property prices
By then property prices throughout the country will have reached 1990s levels.
Houses are still grotesquely over-valued and over-priced, when compared with average incomes and the cost-of-living.
It was only the loose lending policies of banks during the 2003-2007 bubble years which allowed prices to get so out of kilter with incomes and the CoL.
With bank lending tightened up so dramatically there is nothing to hold prices and valuations up where they are now, and so they must fall...and they are.
The earthquake may accelerate this process in Christchurch, or the input of tax dollars may temporarily halt (or even reverse) it, but sooner or later that city will see prices fall as much as everywhere else.
It's those pesky fundamentals at work, see?
ChCh wil be fine . As long as
ChCh wil be fine . As long as there is enough Golden syryp and Aertex Polo Shirts .
Some of those random shonkey developments like Brooklands , Northwood , Bexley , Pegasus etc will just become an area to plant some flax and then 30 years down the track they will be developed again in readiness for the next one in say 750 years at which stage we may have all moved to a klingon residence circling Uranus and we will still be waiting for some clarity on what happened at SCF.
Having lived in Mt Pleasant on Bedrock we might be left holding the flag.
its about to grow in the
its about to grow in the short term as builders / contractors / everyone seeking a slice of the 4bil flock in
$4B seems a lot considering
$4B seems a lot considering the water and power is 90-95% still working. $4B would mean $40K per house? Most people I know have little or no damage to their houses, maybe a few holes in the roof where a chimney has fallen through.
Where do they get these numbers from?
They forgot to add the
They forgot to add the handouts to farmers.
I don't think most people in
I don't think most people in Treasury have ever got their hands dirty going near a farm.
Bugger all farmers get their
Bugger all farmers get their hands dirty nowadays. That's what minimum-wage staff are for.
Annual "fact-finding tours" of Tuscany and new VX 200s for all!
We have allocated time for
We have allocated time for you at the next paddock meeting anon....you will be able to show us all what it means to "get the hands dirty"...even the dogs are looking forward to that day. You will attend...won't you....please....it means so much!
What the hell would you know
What the hell would you know about work, townie?
And flying over a farm a few times doesn't entitle you to speak on behalf of farmers, okay?
Now that you mention it , I
Now that you mention it , I have noticed there seem to be a lot of new VX 200 Landcruisers on country roads. I always wondered who on earth could afford these things.
In my area i've noticed a lot
In my area i've noticed a lot of big diggers and large cranes being transported to the ferry at dire straits no points for guessing were there heading.
Don't worry Cantabs help is on the way.
Very sorry to all those in Chch and hope u can all get some much needed sleep 2nite.
gota sign out an get 2 nieshift.
Wondering just how good is
Wondering just how good is the EQC fund? I remember they invested overseas when the NZ$ was 36c to the US$ and more recently I read that another proportion was in NZ Govt Bonds. These Bonds will be another debt on the NZ taxpayer!
huh? EQC should have some
huh?
EQC should have some money overseas, makes sense surely?, big quake, rate drops, bring back the money to spend on repairs and get more NZD.....?
NZ Govn bonds are debt whether owned by a private investor, institution or the EQC...its not "extra" debt.....
Bonds are usually considered a safer and a long term play.....In fact if you actually look at bonds, shares and property over 80 years ie since the 1st Great Depression they actually do quite well....plus in the event of an earthquake in Wellington, shares could/would tank...property er well would be wrecked....bonds would hold their value better and can usually be cashed fairly easiliy....
If i recall correctly "Valentia" you would seem to have a pretty out there political stance...which seems to colour your posts past what looks like the point of reason....
regards
Yep. You don't use the house
Yep. You don't use the house you're insuring as equity to do so.
So the EQC will be mostly offshore.
A lot of the common insurance
A lot of the common insurance will be reinsured off shore as well through insurance associates. This has the potential to seriously lift national GDP and employ a lot of currently underemployed construction workers with little financial consequence to the wider economy. If $4B is the all up sum we could be looking at a potential 1% added to GDP growth for each of the next 2 years. Sorry to rain on your pity parade :D
Have they considered the cost
Have they considered the cost of road repairs , rebuilding a minor road from substrate up can cost $1,0 million per 1 km
For an earthquake of this
For an earthquake of this type the roads are usually only affected within 20-30m of where the fault crosses them. You could be looking at 2-3km maybe - fairly small change in the scheme of things.
By far the greatest damage will be brickwork (chimneys) and brick and stone facades. Most structures should be robust enough to remain undamaged except where they have been impacted by brickwork.
Hey at least is wasn't the
Hey at least is wasn't the Alpine fault's predicted 9 shocker.
Dear chchhomebuyer, And y.
Dear chchhomebuyer, And y. simy7Colin123Have they....?Anonymous, steven-orig2, Dean Left-us (broke), rc, Nutter, annonentity, Commonsense
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cheers
Bernard
Who covers the cost if, after
Who covers the cost if, after the earthquake, a house owner can't rebuild on their cracked liquified section? IE who pays for an alternative section on which to build if your section is condemned? Insurer? EQC? Council? Owner?
Taxpayers ratepayers and
Taxpayers ratepayers and owners MB. The answer is the Yurt. You can shake the Yurt like mad and never get a yogurt.
Just had some feedback from
Just had some feedback from ChCh. Seems like the place has been inundated with well meaning folk adorned with badges for africa extolling their expertise at things like abseliling and rescue techniques through to Civil Defence Rice Pudding makers all of whom are becoming somewhat of a pain in the rrrrrrss to the frontline services.
Please if any of them read this just go home
Harsh but true. We often
Harsh but true.
We often have the same issue in Search and Rescue. Back in the 1960's you needed hundreds if not thousands of volunteers to comb places like the Tararua's. Though well meaning they would search the easier to get to places several times but completely miss large area's. These days with choppers and integrated eletronics/GPS systems you can do the same job 5 times as well with just 50 trained people.
Volunteer help is nice to have, but unless it's integrated/trained it can be a major distraction