Forget about "seasonally adjusted migration" its the real numbers that count - a gain of only 400 in April.
The seasonal adjustment is not really relevant now because usually it would take account of the fact that kiwis tend to leave for the OE at the end of summer - ie. April - to go into the northern spring. Because of this the seasonal adjustment for April usually ups the figures to relfect this large surge out of the country. As much fewer kiwis are embarking on the OE this year, the real figures are essentially adjusted already
The much hyped return of cashed up expats is not happening, the gains are mostly due to fewer kiwis leaving and more students coming here
Just wait for the spin from the RE crowd

Ray
What work are those immigrants doing, Filipinos go straight to dairy ,only ones prepared to work so hard for so little. If every immigrant deprives an existing Kiwi from a job, then 'Huston we have a problem' Immigration in a time of rising unemployment, a blow out in Govt spending and pressure on entitlements doesn't look that good an idea.
Better watch out they may be after your Job....

Are the figures demographically adjusted as well?
Net of 400 are who? All single work age men? All children under 6? My guess is a mix, but "+ 400" doesn't equate to 400 more earners with purchasing power, or a need for 400 rooves over each head.

Mitch O. There is no housing shortage in NZ! No one is standing in the street with a suitcase in their hands looking for a room (metaphorically speaking). There is only inequitable distribution of house ownership. A reduction of multi property owners to single property owners can fill any "shortfall" in housing that comes with an increase in immigration. ie: make it cheaper for renters to become owners.

Janet,

Mitch O didnt say there was a shortage of housing, just that these stats are pointing in that direction if the trend continues and at a hundred families of four/mth/mth/mth/mth, he is right

Here's a thought for Mitch O. As the old coots sell out of their huge homes, these will be bought up by landlords, converted into flats to house the migrants. Demand for new homes will be less than you think. Maybe the builders will find work doing the conversions. Already in Marlborough the tempers are raised as properties are altered to become rental cash cows.

One of the "emigrants" that everyone is speaking of if our new exchange student - with one more to come in a couple of weeks. Both of these boys are 15 years old and will stay in NZ for 3 years to finish their high school education and no - neither will buy or rent a 'new' roof over their heads soon as they are sharing ours... no big house price increase or demand here...

Mitch O,

If the supply shortgage is so obvious then surely capital would be made available to build more homes cause at the end of the process there will be a guaranteed sale at a good price. House construction is slow because most pundits (banks and developers) know that they will struggle to sell a house once it is built .. unless they drop the price drastically. If it was a sure thing everyone would be building. They are not, and with good reason.

This is why a recovery is not going to happen in a hurry.

http://www.informationclearinghouse.info/article22667.htm

Janet,

Gareth was representing Informetrics view - not his own. And I'm certainly not advocating anyone put money into residential property at this time. I am saying the residential property price decline has or is bottoming out.

James,

The housing shortage is pending. And it is inevitable (barring a cataclysmic event eg ebola virus wiping out half of Auckland).

I told you the real estate mob would be producing spin soon and there you go, Ray pops in after me.
What don't you get Ray? Shall I say this again LOUD AND CLEAR - the gain was 400 - read 400. Bugger all. And I'll say it again - Seasonally adjusted migration figures are a nonsense, its like saying "Oh there were only 100 houses sales in July but because July is always quiet because its winter we'll round that up to 300"

Mitch O - look beyond the RAW DATA. Most of the gain is made up of kiwis deciding not to leave, and students (as illustrated by Mimi). Its not due to an influx of cashed up immigrants. Yeah sure, net increase in migration is better than net decrease for housing, but at these sorts of levels impact will be only very minor

Here's another thing, Matt in Auck. I have retiring friends who want to go off to Oz ( it's warmer there! I understand, today..) but can't. They won't sell their house(s) "at these levels" and will wait till the market ticks up. Now there's part of the statistics of resident who are staying put and increasing the net migration figures.

Here's a question: Is there a law(yet) against parents hitting the road with their kids in a housetruck? Living the life of 'gypsies' and enjoying a certain peace of mind away from mortgages and all the urban crap. Yes I know, there are those who positively foam at the mouth when they discover others have found a way to avoid having to live
as they do.

Look at these figures - the Reserve Bank graph on household debt (now colossal):
http://www.rbnz.govt.nz/keygraphs/Fig5.html

and our astronomical current account deficit:
http://www.rbnz.govt.nz/keygraphs/Fig6.html

Not to mention our unemployment rate rising dramatically:
http://www.rbnz.govt.nz/keygraphs/Fig9.html

Now tell me: how is the failure of NZers to rush off to Oz for their fortune, or others coming back with their tail between their legs, going to reverse that? Are the Indians & Filipinos going to set up enormous export-oriented businesses that are going to reverse the current account deficit & rising unemployment, plus pour truckloads of $$ into the failing housing market? All in the context of a declining global economy? Supporting housing prices can only be done by big-scale injections of $$ (we're talking 10s of billions). Where is that going to come from?

I am cashed up ready to buy a house at any time, but I just look at the fundamentals & think, no way Jose!

Philly - due to a fortunate windfall I too am able to buy but like you I look at all the various fundamentals (ie. rapidly rising unemployment, still very high house price to income ratios, ageing baby boomers etc.) and think "not yet"

Mattinauck: Sure. I have been looking at it systemically for years, just as I did previous bubbles such as the 1980s share market boom & 1990s dotcom bubble. Timely movement of assets can prove a very wise way of leveraging your resource base.

When bubbles turn sour, then tend to do so over a long period (similar to the period of inflation). Plus there are lots of short-term fluctuations, "noise" in the statistics, contradictory signals, & incompetent analyses, which can trap the unwary. It is important to look past these at the wider systemic imbalances, & keep a level head. I expect to wait at least another year.

Where lots of commentators see Kiwis returning from Oz, a reduction in interest rates, or a weak $NZ as strengths, I see them as indications of weakness.

My main fear is inflation taking off. Any sign of it & I may dive in quick, since inflation may destroy the value of my bank deposits quicker than I can get gains from a falling (in real terms) housing market.

Interesting to see that dairy farmers don't have to improve wages and conditions to get workers. Instead they can import cheaper ones from overseas. So these jobs are being allowed to avoid local market forces and dairy farmers are allowed to import cheap labour from other markets with different conditions.

These jobs are being "outsourced" right here in NZ.

A guy I know near Foxton saw his partner leave him and his life be consumed by a job on a dairy farm that went for 14 hours / day and he got 1 day off in a fortnight.

The pay was over $50k / year....but the conditions were horrendous. No wonder they can't find people for these jobs.

Matt in Auk
"Trass reckons another 10% fall over the next year"
In 2005, Trass told hundres of people in Ellerslie convention centre that the housing market would slow down in 2006 and the price would drop.
Trass told me to fix all my home loan as long as possible at the begining of last year when 2y to 5y loan was 9.2 to 9.5%.
He has been on media for last two years saying the house price would drop 20%, 25%, 30% and this he said upto 10%, so I was really confused by his many comments honestly.

Good luck with that Newby. Have a good rant why don't you!
Meanwhile back in the real world we have a fiscal deficit set to reach 50% of gdp and probably stay there. The hosing sector is buried under a 180 billion dollar elephant named 'debt'. Property grows more unaffordable with every passing day as real incomes fall. Unemployment is set to reach 10% and stay there. The 'return of the wealthy expat' dream is dying out. Bollard is doing his best to pork the economy with cheaper credit for longer. English can see red ink into eternity. Interest rates are set to rise as the fallout from Mervyn Threadneedle and Ben the Printer turns up to push inflation way way up there. And not to forget the worldwide govt borrowing binge where tens of trillions are needed to 'balance' fiscal deficits, the result of which will be bloody expensive credit leading to a modest rise of rates from 7% to 17%.
Just like 2000, I don't think so.

I m looking at farm returns for last year in my area. Average return on investment EBIT %.21. If anyone thinks this country is going to raise enough income to pay its interest cost on these returns they must be ........

Ahhh dude. Stereotyping is a form of racism.

Do a google on - banal racism - might learn something.

It's all relative, Matt in Auck.
NZ$500k = A$400K = Stg200k. Trust me! You don't get much for any of those amounts in their homelands either....and they have little add-ons, like S/Duty in Oz. ( not sure how many Zim$ trillions that is, this second!)

You got that right Matt. Had a chat with a couple visiting from Switzerland who stayed a few nights with friends in Christchurch last July. Her comment was( you need to fill in the missing word Matt) "The room we were in, we had one little heater and it was so %$#@$* cold"

Pink - exactly. I wouldn't be so fussed playing half a million if I knew I as getting a solid, well insulated home. I am not expecting bells and whistles, like Euro kitchens and 3 bathrooms, just a good solid 3 bedroom one bath home that doesn't leak and freeze in winter.
Is is too much to expect something like that for 500K?

It seems to be.

Quality of rmoney is something the Demographia surveys don't pick up on (I'm not expecting they should). For example, in Denver USA the median house to income ratio might be 4:1. In Auckland that same ratio is in the order of 6:1. Yet I bet you that Denver house will be a better quality house with much better insulation than the Auckland house.

Even if you look at say Melbourne versus Auckland. The ratio is probably similar, yet you will get better quality housing for the same affordability there (generalisation I know, but my understanding is that the quality of Aussie housing is generally a step above NZ)

How to get a better Kiwi box. Buy an old place with a verander all round if you can find one. Fix a stack of straw bales against the outside walls using number 8. Mesh the lot with a tough plastic and slobber a few coats of lime based morter over it. Send the wife under the house to fill all the spaces against the floorboards with 2 inch thick polystyrene slabs. When that's done, shove her up a ladder into the ceiling space. Biff up more straw bales for breaking in half and covering the ceiling. If you have run out of bales, use stacks of old newpapers. Fit a really good wetback woodstove and a system to shift the heat into distant rooms. Cut polystyrene slabs to fit the window spaces on the inside. These you fit snuggly in place on frosty nights. They let in some light during the day so can be left there for some time.
All good fun, reasonably inexpensive and guaranteed to keep the old girl in shape.

Doesn't sound like much fun to me, Wally.

Think of the end result Janet, a well insulated Kiwi box to live in. That's gotta be worth braving a few old spider webs. Imagine doing the same in Aussie! snakes and gawd knows what else ready to have a bite. And these straw bales are ten times the insulation level of the best pink batts. That's the old type bales Janet, not them truck size jobs.

Ok, glad to see I'm not insane.
Our housing is a rip off, no doubt about it.
Jabber - interesting views. My brother came back for a couple of months from the UK after losing his job there, was reconsidering his options and whether he might live in NZ again. He was shocked by the cost of housing here relative to income, especially when he considered the STANDARD of housing. He's staying in Europe now, having found another job

Im off to Bali for 60 days next month. Should have gone this month. Fire roaring here:)
NZ is a good place for 7 months of the year. You just have to get out the rest of the time.

This housing market is a sitting duck for Chinese competition with solid timber northern hemisphere spruce cottages being built in China today. All it will take is for them to set up here and import their product and the labour to assemble. Nothing to stop it.

And if you're a tenant you just avoid the unheated houses that the landlords own....easy!

From the same BNZ report:

Key Forecasts

Dwelling consent numbers to slowly recover from the middle of this year.

Real estate sales have bottomed for this cycle. Activity is likely to fluctuate and begin a drift upward before year end with potentially firm activity over 2010.

House prices at worst to fall another 5%, stabilising now possibly, then rising slightly over 2010.

@ The Bank Mgr

A cycle is only a cycle once it has finished and in no way are we at the bottom of this one yet. Looking at all factors why would property defy all other economic indicators and either stop falling and/or start to move up?

Sales are falling because demand is dropping and the hype about property always going up and capital gains forever has been shown to be a myth.

I would suggest property isn't going anywhere soon for at least 2-3 years....

We still have the 10% unemployment rate to come, and the gradual increase in interest rates, not withstanding dropping incomes to be completely factored in. Those that buy now will look foolish by year end!

excellent piece from the NBR today on migration and housing, with some very balanced and intelligent comments from Cameron Bagrie:

http://www.nbr.co.nz/article/migration-wont-affect-housing-market-til-20...

Shows that along with the ANZ there are some balanced Bank economists still out there - not all of them are mouthpieces for the property industry!!!! (not mentioning any names)

Interesting to see in the latest Westpac economic report that they are predicting unemployment will peak in the UK at 5.5%, versus 7.5% here and 8% in Australia
So maybe kiwis will start flocking to the UK again soon as unemployment rises here

Hi Allen - thanks for the update, it is actually Westpac's economic commentary for this week - go to page 8 of this link for their UK forecasts:

http://www.westpac.co.nz/olcontent/olcontent.nsf/content/FM_Weekly_20090602/$FILE/NZWC0206.pdf?Open

Maybe that just shows how out of touch with reality bank economists in NZ are?