Well thats almost all their bullets used up then - fascinating that its had zero effect on the UK housing market, now down a mammoth 19.8% (Halifax).

Re the UK housing market and its effect on us, I found this comment very interesting from a piece from stuff.co.nz:

Quote:
Kate Jackson, a director of nursing recruitment firm Tonix NZ, said demand was as strong as ever for candidates.

"If we had 100 nurses jumping off the plane tomorrow, we'd find jobs for them throughout New Zealand."

Her firm recruits mostly English nurses and Ms Jackson said interest had been largely static since house prices crashed in Britain, making it difficult for candidates to sell up and move to New Zealand.

So it seems would be immigrants from the UK have their hands tied - not helped by the fact that their buying power IF they manage to sell their house in the UK has been drastically reduced in NZ$ terms by the 40,000 pound average fall in UK prices.

Richard,
in that scenario, people emigrating could choose to rent their property out rather than sell it. New Zealand could then end up with a bunch of absentee landlords who are hoping that the exchange rate will move in their favour, so they can sell and move the cash to Australia.

I think that you would find many people moving accross the ditch cannot afford to buy a house in NZ so have moved to aus, where with higher wages they can save up a decent deposit. They may well begin to return to NZ for the lower house prices now that the bust is begining in aus and job cuts etc begin.

The Europeans are capitalising on the exchange rate at present and starting to buy property in London. Wealthy or cashed up buyers undoubtedly - local people can't get a mortgage for less than 40% deposit even if you have a secure income (what ever that might mean today "“ take heed NZ). Banks are like possums frozen in the headlights. Cashed up NZ'ers should consider buying here NOW. Building projects are taking off - suggesting green shoots in London at least. NZ is just beginning to feel this crisis - we have been in this for 12 months ahead . But I suspect a knock on affect will not be felt in general economy for another 3-6 months at least. The buying is very good IF you have the capital.

Fair enuf Andy - bet is on to which economy recovers first. Just knowing the British love to overstate disaster and the Kiwis penchant for denial, something to do with the "˜press/political' differential I would say "“ nothing to do with my reporting. I am picking NZ is at least six months behind UK. I do remember people on this site mocking me that the downturn UK was experiencing 9 months ago was a figment of my imagination - nothing like the 70's they experienced in the UK (yeah right!!!) AND that NZ would not be affected at all. I'm trusting the Europeans know a barging when they see one - their market was never that over heated. I know where my money is spread and my head is well read. Where is yours?

Sharon - I certainly agree with you re:denial in NZ. We are just about to start on the second leg down of our recession. If the first leg was caused by drought/the initial stages of the housing bust then the second leg is all about the global recession/depression/our very own commodities bust. Mish makes a good case that depression is already here in the US, and 1.1 million job losses in 2 months makes a pretty good supporting case. Its still all about capital preservation as far as I can see, far far to early to start picking winners for any up-swing (in the medium term there must be a 30% and rising chance there wont be any upswing anyway - I am far from convinced the Central banks can pull us out of this on a 12-24 month time frame). As for the Eurozone - well Germany is riding the downward spiral of a bust export dependent industrial model (a la Japan), the PIGS are in such trouble its nigh on unbelievable, and the rest will get pulled along in the slipstream.

G.S.T payments and tax revenue from withholding tax on interest must be crashing,apart from the 5billion lost or frozen in finance cos.plenty on fixed income will be moving down a tax bracket.where can they get the money from?even if they rob the cullen fund it has taken a hit too.you cant do the mother of all budgets again.you could kick all the slugs and barnacles out of the govt depts but they have sweet redundancy agreements and would cost millions in payouts.

yes there is a cold wind blowing up everybody figuratively in the UK and in reality too,probably about one degree centigrade right now in London.not a nice place to be unemployed or sick.do we lockstep with their housing market though?didnt they have the old negative equity thing happening and people walking away from mortgages before and we didnt.

Sharonv

Or were we all just lulled into a false sense of wealth by cheap/easy credit and now the pecking order is just being restored to its natural (un)balance?

The two Andys & Steve

So pessimistic......... every day there are houses/buildings that have passed their used by date and are in need of updating/pulling down etc

Yes property will come back back to a more realistic level but is this a bad thing?

The problem only comes when a "loss" is crystallized on a sale in a depressed market and this is up to the banks not to collapse house prices by upsetting the supply and demand equation any further.

Question to all bloggers if you had to sell for a 30% reduction from peak valuation would you walk out with more than you put in?

I found this an absolutely cracking read:

http://anonymousmonetarist.blogspot.com/2009/01/david-rosenbergs-letter-...

Neven911

One of our friendly Aus owned trading banks made their entire years fixed income trading margin in 6 weeks and have kept it. I have friends still with trading jobs in the UK who had read the signs and have also been making a lot of money but they would be social pariahs if they beat their chests about it.

So it all depends on which side of the trade you have been on

Andy....good read ...how busy would the Auto Industry be if the Worlds entire fleet of cars had to be swapped for Electric Cars (or similiar) ...this is just a(nother) tipping point in human civilisation that will provide the catalyst for change on a large scale.

Andy wins "link of the day award"

A very good read, here is the New Zealand take home message......

"Even so-called recession-proof items like food (-3.6% SAAR) are being cut back on as households shift from veal marsala to pot roast, and from brand name to private label (in real or unit terms, food consumption has declined for six months in a row, so this is not just about lower prices, but also about shifting spending patterns even when it comes to grocery shopping)."

Not so good for our value added, high end target market commodities. French rack anyone? High quality wine?