Have these guys been hanging out with realestae agents?

"Meanwhile the Department said this downturn differed from previous ones because it was not connected to negative net migration or an oversupply of housing." Huh??

The government is going to inherit homes from banks under its security for cash swap scheme when the banks can't pay the gov't back (or don't want to).

A lack of skilled builders? I don't think so.
What do these guys do in Wellington? Look at data thats 18mths old?

I wonder how much influence the (assets $14B and declining plus 20 Corporate member) Property Council wields with government?

so what is new in what this briefing paper says?
Another example of the kind of c..p are tax is being wasted on.
The govt. doesn't need to do anything about housing affordability, the market is correcting itself and will continue to do so
Of course if they want a total property collapse then sure go ahead and build tonnes of new houses and cause a huge oversupply. As a prospective first home buyer I would welcome any initiatives that bring Bernard's 30% decline to fruition. I don't think the 30% decline will be borne out (I'm betting on 15%) unless they do something really stupid like builidng thousands of new suburban homes on the urban fringes (which is what it sounds like they want to do)
also they totally ignore demographics and forget about the tide of baby boomers who will either exit Auckland to the countryside, coast or Australia or downsize within Auckland. Oh, but people argue that a new generation of home buyers will be coming through...BUT......again look at demographics - generations X and Y much smaller demographic, biggest section of young population is generally polynesian and low income therefore hardly a demographic picture to bolster house prices
Based on demographics I would suggest that we need to forget about building "conventional density housing" (ie. detached family housing) and focus on townhouses and apartments for the growing number of smaller households
Of course from a purely selfish point of view I hope they start wacking up thousands of new suburban homes as that will mean I'll be able to get a home for my family dirt cheap.

So who are the "new house buyers", well of course they don't exsist (mostly) as anyone with any show of paying abit of interest on a mortgage has already been lent the money and is living in their indebted abode. People just can't afford houses at the current pricing levels, banks can't afford to risk lending any more money on houses at current pricing levels, so current pricing levels must simply fall, its no pessimisim, its reality. Hold off buying Matt, even at a 30% discount those mortgage repayments are going to take a big chunk of your income. The new rich are not the ones with the most assets, but the ones with the least debt!

Steve L

I think its a little simplistic of you to evaluate the adequacy of housing supply with the real estate market, housing unaffordability has caused great stress in supply and this report has identified some of the causes. As developers crash this will get worse.

Maybe they will realize that Auckland cant expect to further sprawl with 'conventional' houses and I'd love to know how "The way in which urban development can be improved"

Matt

You are right we don't need more sprawl

Robert

The land cost is a huge variable, In fact when a 'house' rises in value its not generally the 'house' that rises is it, its the patch of land it sits on.

Neven

Steve

"but someone else will pick up the project at a lower capital cost and make a go of it"

Really, I remember post 87 there were a lot of "car parks" around Auckland as the sites of demolished buildings sat around for a decade or more

As for developments in Queenstown and Pegasus town I can see them being ghost towns as the discretionary dollar dries up.

In the mean time there will still be overcrowding in Auckland.

The simplistic broad brush has never worked for me unless I'm making inaccurate generalisations.

Neven

In our part of Auckland, there are a lot of vacant new /near new houses built for sale
Also a lot of sections and sections 1000 to 1800m sq subdivisable for sale
And a lot subdivisible if the services where upgraded a little.
There is still a huge amount in Auckland to take advantage of to build more affordable houses.
Another issue is the overhead costs of building a house on a current site..permits inspections, add to that stupid costs like a hand rail for 2 steps... dive ways foot paths, landscaping requirements
Originally, upto sometime in the 80s I think, Affordable housing did not come with a garage, paths, driveways...owners added these over the next few yrs.
New affordable housing is killed by bureaucratic empires that where meant to prevent things like leaky buildings.
When bureaucracy can be 30% and more of the cost of a new home then add paths drives etc something is out of control....someone has lost the plot.
Fix the bureauocracy 1st...that will add stimulus to the industry THEN progress from there.
Put the cart behind the horse.

Much of the land that can be ear marked in Auckland has not been built on over the last 100 yrs, simply because of stability issues, and 1 in 100 flooding issues... yet the experts in the last 30 yrs have now deemed suitable.
How the hell a retire Auckland major can build on a cliff face, when issues of breaking cliff faces have been crumbing for decades....once upon a time these areas where put aside for public recreation areas, and rods placed back houses built on the other side of the road.
Doesnt need degree or PhD to work out, but does need one to do it.

>> Productivity in New Zealand's housing sector was low relative to the rest of the economy and the rest of the world, reflecting low training and skill levels in the industry, the department said.

And here was me thinking that NZ was getting screwed by a cosy mono-duo poly of builder industry suppliers.

>>Matt in Auck Says:
December 18th, 2008 at 6:45 pm

">>...also they totally ignore demographics and forget about the tide of baby >> boomers who will either exit Auckland to the countryside, coast or >> Australia or downsize within Auckland. "

Mmm, those boomers are hitting retirement years now and want to cash out of their property invetsments in the lifestyle belts and their investment properties/beach houses or their family homes to release cash. This trend will continue over the next 5-10 years. As I understand 2008/2010 is the peak of the boomer demographic hitting 65.

Given property has been dead for at least 12 months now depending on whom you believe, add in a global recession and banks returning to 'normal' lending criteria and we are looking at probably another 1-2 years before prices return to an 'affordable' level. And then a slow growth trend after that linked to OCR +/-.

I totally agree in broad terms - the boomer migration out of housing investments starts in earnest around now with the largest 'chunk' over the few years post 2008/2010 (you seem to have a better handle on the actual dates).

The oldies arent going to be able to stay on in smaller rural/coastal areas once they need more medical care or the lifestyle block is far too much overhead.

So prices should be on the way down once this trend kicks in, and continue down for some time.

Seems like we agree.

With Gen x and Y being smaller does this mean the world popn will shrink and therefore a reduction in byproduct of human activity and hence therefore the Planet is Saved???

Only a few months ago people were bemoaning the fact that they couldnt get married/have children etc because they were saving for a deposit on that house that just kept on Skyrocketing now there is a picture of the poor couple who cant Get married/have Kids etc because they bought at the top of the cycle.

I know of one banks currency traders that have made a fortune in the last few weeks.

"One man buys and one man sells and both think they are astute" (whoes line is this?)