A big jump in residential rents in January means the national median rent started 2024 on a record high.
According to the latest bond data from Tenancy Services, (part of the Ministry of Business Innovation and Employment), the national median residential rent was $608 a week in January this year. That's up $28 (+4.8%) a week compared to December last year, and up $33 (+5.7%) a week compared to January last year.
The big jump came after a period of relative stability, with the national median rent hovering around $580 a week for the second half of last year.
Because these figures are sourced from bond data they will mainly relate to newly tenanted properties, making them the most up to date rent figures available.
They are also forward looking because they set the benchmarks for landlords when they review the rents on existing tenancies, so they give a strong indication of where rents are heading.
The national figures reflected the movement in rents in most regions of the country in January, with the notable exception of Auckland which is this country's largest rental market by far.
Auckland's median rent was $650 a week in January, unchanged since September last year. However that followed an increase from $600 to $640 a week in the first half of last year.
As usual the biggest increase in rental activity in January was in Otago, which always has a huge spike in both the number of properties being rented and the median rent, as university students flock back to Dunedin for the start of the academic year.
This year saw a particularly big jump in Otago's median rent, which leaped from $520 a week in December last year to $675 in January this year.
However if the Otago market follows normal trends, that figure should drop back to normal levels as students get their accommodation arrangements finalised for the year.
The figures also suggest that student accommodation in Otago may not be as popular as it once was.
The number of bonds received from Otago peaked at 3081 in January 2017 and have declined in every January since to 2298 in January this year, a drop of 25% over the last seven years.
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143 Comments
The coalition have a big job on their hands. Tax relief will simply flow into landlords pockets. I think we have a disaster on our hands with the housing market. With the current 'plan'... I can't see any improvement in affordability for anyone... our kids deserve better than this surely?
The housing market issues are largely caused by inflation (excess money printing / government expenditure) and inflation.
The tax package will have a very minor impact and if anything might prompt a few landlords to hold off selling for a while.
LOL.
Edited: This article contains much of the background for why I LOL'ed. https://www.stuff.co.nz/politics/350218439/can-chris-bishop-pull-housin…
It is remarkable that anyone can write a lengthy article purporting to explain the housing market without mentioning the effect of housing speculation/lack of capital gains taxes/limited alternative 'investment' options, without considering the effect of increasing wealth inequality (see, eg, https://www.wealtheconomics.org/introduction-2/ ), without assessing the effect of the early 1990s changes to central government support for housing to support for landlords ( https://www.buildingbetter.nz/wp-content/uploads/2023/08/Saville-Smith_… ), relying on dodgy neoliberal econometric analysis without noting what was omitted from that analysis (read the fine print in the reports), and not recognising that the significant limitation of the private housing market is that developers decide the rate and location of new housing in order to maximise their returns - which is why a massive public housing effort if needed to provide sufficient first homes.
Haven’t bought the ‘enabling supply = solve housing affordability’ koolaid Andrew?
Good post. And mostly true. And a single sentence!
But the stuff article, rightly, leaves out the stuff you mention because it'd set off the rabid right.
As an aside, you may want to consider the highlighted bit in the bit below:
"...not recognising that the significant limitation of the private housing market is that developers decide the rate and location of new housing in order to maximise their returns - which is why a massive public housing effort if needed to provide sufficient first homes."
Do they 'decide'? Or do they only operate where, and when, they are permitted to? BTW - developers aren't charities and we'll not enter a development when there isn't any real chance of making money. You don't get to be a developer for very long without making some money for the significant risks we take. Trust me - even breaking even is damn hard throughout most of the economic cycle.
Just looking at Pa1nter's comments yesterday:
Here's their stated functions:
managing inflation to keep prices stable while supporting maximum, sustainable employment
regulating banks, insurers and finance companies
producing New Zealand’s banknotes and coins
operating effective wholesale payment and settlement systems.
Interesting they still list employment along with inflation though.
In the government's rush to undo everything Labour, removing the maximum sustainable employment mandate may end up being the stupidest. Now the RBNZ are required to destroy the economy at any cost to get the CPI in the 1-3% target, they can no longer take a balanced approach. This is the exact scenario it was designed for - if inflation is starting to look under control at least consider the people...
In the government's rush to undo everything Labour,
This is a huge problem for us, and it goes both ways. Each new Govt sets out on a crusade to tear down anything they can that the previous Govt implemented, often with little thought and certainly no consideration of any possible benefits a policy may have. I seems to me it is simply just a symbolic middle finger to the outgoing party.
There will never be any significant change in NZ while this continues, it's simply just a group of egomaniacs playing "I'm the king of the castle".
No this is incorrect. Not every government tears down everything the previous government did. Previous governments have built and modified preceding govt policies, both Labour led and National led.
Last term, Labour had a full mandate from the voters and a majority to govern alone. If anything this made them more cautious about pushing through policy unilaterally.
This coalition is an aberration. It has in 100 days reversed almost every major policy, no costing of the benefits and costs, no evidence to back up the decisions, just pure ideology.
This is how it starts. Rather than seek broad consensus where possible they have moved New Zealand further towards us and them. Rather than focus on our shared values they are focusing on areas where they can generate division. The worse possible outcome for the country.
Labour got into Govt. first time thanks to Winston, and second time because people didn't want to change horses midstream of a pandemic.
And I can't recall them running Three Waters and Co-governance past the electorate as part of any mandate.
We are in recession because of Labour, not National. What happens next is still wait and see.
Don’t forget the RBNZ
We are in recession because of RBNZ policy.
The spending reductions from the current government haven't had sufficient time to have any significant effect as yet - although the chill factor is significant. The 'austerity' policies will start to bite - and bite hard - in the next 6 to 9 months.
It depends on a number of factors. If workers are given a six month redundancy package, and are able to find work within 6 months, then I would imagine the job losses would not hit the economy so hard, but I could be wrong.
Who the hell has 6 months' redundancy package these days?!
I really don't know, so wondered if others here might know. Figures haven't been given in the MSM.
A few years ago, a colleague was given a year salary as a redundancy payout (government department) but he had been with the department for over 20 years.
If there are redundancy payments, then that would cost the government hundreds of millions, surely, so the overall "savings" won't be as high as estimated?
Realistically yes, those who have been in govt within the same department for 15-20years or more will have more favourable redundancy conditions. These days it is 3 months pay and see ya, so the question should be how many are in this tenure, and how many of them would be let go given their experience and value added to the role they’re in. My bet is they would cut staff with low tenure, low productivity and much less valuable redundancy clauses.
Had it happened to me 10 years ago. Got paid out 50k. Found a new job starting the following Monday paying 5k more and with a company car. It was the best week of.my career.
Talking to someone from tv3 last night, been there 10 years, 40 weeks redundancy payout come June.
Labour spent too much and that’s why there’s not enough money. It’s so simple that it makes no sense.
Towards the end of their term, labours spending was one of the few things keeping the country out of recession. That and immigration.
Now we’re looking to reverse those two things, currently Nicolas year 9 math skillz are keeping things from being much much worse. Just wait for the new taxes and the pain they bring.
So you're going to ignore the inflationary effects of the RBNZ dropping the OCR 0.25% while throwing 000s of millions as the banks to lend like crazy too? Seriously?
The first paragraph was sarcasm.
Those are not paragraphs. Lookup the definition. Sadly NZ education being what it is knowledge about basic paragraph structure is also lost as well as comprehension of what sarcasm is. Your "skillz" are worse then your pet peeves.
Hmm ... National / ACT introduced the 'bright line' tax. Labour / Greens didn't tear it down. They extend it so that 'landlords' had to live by the statement it was indeed a 'long term investment' and not a thinly disguised speculative grab of untaxed capital gain.
IRD have longstanding had the rule that a property bought for speculation, rather than as a long term rental, needs to be taxed at the time of sale. My accountant has always had the impression that 7 years or more of providing tenants a roof over their heads would be necessary to show the intent was to receive rental income. So even with a 2 year brightline test, he would indicate that a sale could be taxable after 3 years.
Can't you just prove that your circumstances changed somehow? If I buy a car and sell it a year later, that doesn't mean I was speculating in car investment, I may have just changed my mind or needed the money elsewhere.
Yes, the onus is on the home-owner to prove to the IRD that the purchase was not for capital gain, and if you can prove that, and if they believe you, then they would not charge tax.
Either you are not understanding your accountant, or selectively hearing what they said, or you need to go back to them and ask for the full facts. Or maybe your accountant is as useless as you say?
Gee, thanks Chris, I usually like your comments! Chill out - I come in peace!
No, I not saying my accountant is useless, and in any case, my investments are long-term.
I'm happy for you to just say that my accountants advice is incorrect.
Why?
As far as I know his accountant is entirely correct, the brightline doesn't matter, if you bought for speculation then no matter how long you hold onto it or rent it out for its a taxable sale. The 7 year thing is his accountants opinion, at that level if you say you didn't buy it for speculation IRD would have a very hard time making a case that is was speculation without some direct evidence from you saying otherwise. eg an email to a mate saying "I just bought this house for $x, i'll flick it off for 30% profit in a couple of years"
The hard bit is proof, for both sides. The brightline just says that if you sell it in under 2 years its taken as proven that you did buy for speculative purposes and therefore it is a taxable sale.
It was the the "7 year" thing I objected too. There is no such measure. Never has been. Nor can there ever be. Read on ...
With regards proof of 'intent' - almost none is necessary from IRD's perspective as every property 'investor' acknowledges the tax free capital gain when the property is sold was part of rational for investing in the first place - it is impossible to deny and largely ignored if the tax payer pretends they were unaware. The IRD will press the issue if the property is sold at the point it starts to pay tax on significant portions of the rental income. About the only way to escape the inquisition is to hold the property some way past the breakeven point and pay tax on the rental income so the IRD doesn't get triggered. How long that is period really comes down to how much accumulated tax has actually been paid and whether it is worth IRD's while to pursue the issue. (IRD is getting more budget to come after people rorting rules like this.) As you can imagine, when that 'breakeven point' occurs and how much tax has been paid after that point will differ from property to property and makes a further mockery of the '7 year' statement.
This sounds like complete nonsense to me.
The IRD will quite happily accept that you bought it as a long term rental for the rental income if you have owned it for 20years and eventually sell. Its just a grey area if you sell in a few years. Ans also circumstances change. The IRD probably wont go chase down a widow for speculation if she sell the rental property not long after he husband passes away because she doesn't want to deal with tenants, tradies and property managers.
Tell "our kids" to get off their buts and buy a cheap property out of town and fix it up, and move up the ladder, plenty are doing it.
When non-deductibility of interest came in, I put rents up 15% to market rent instead of letting them be, I was forced to look at them and increase them.
With deductibility back in 1/4/2025 - I can stop that annual 10% plus increase - and just let them wander.
Otherwise a minor cash loss for the year, becomes a 10k invoice at the end of the year, that comes straight off the family budget.
The top of town Property Investors can lease to social housing providers and repurpose debt accross to commercial, so it only affected mum and dad investors with 1 or 2 rentals you moron.
So it seems on average, rents barely higher than inflation, despite wages up substantially and housing related costs up by record amounts. And yet people are screaming for rent controls.
Its the right using it as justification for tax perks. People are being told that rents are soaring since Labour's changes and just assume it to be true regardless of the facts.
Rents are driven mostly by the market. Those allowing the outrageous population explosion has a lot to answer for.
Turn off that tap, allow the natural outflow of the temporaries, and rents will improve.
How many empty townhouses sitting idle on the market unwilling to budge on price or rent?
I don't work in townhouses but my understanding from other property investors is that vacancy rates are very low ATM.
The reason for lower rents in Auckland is the flow through from the Unitary plan changes, it allowed massive levels of hous building. Supply and wages are the two primary drivers of rents.
Despite what some say, i think AKL, WLG and CHC distort wages substantially. You have to think of the vast array if other folk living elsewhere who have gotten next to no payrises in comparison, living rurally and still have had rents cranked sky high. It is real and it is outside the narrative.
Rates in Hamilton going up over the next 3 years from $3620 to $5778. Who's going to wear that cost on a rental property?
Yes, my rough estimate tells me that in many places in NZ it is going to be $5k rates bills and $5k property insurance. So $10k to 'own' a home before factoring in interest and principal repayments.
This is why I'm starting to believe in HFL, it feels like some of the bigger price increases are yet to come. We didn't sort our sh!t out when we had the opportunity, it seems a bit late to be building/fixing lots of stuff when a big chunk of the population are retiring.
We delayed infrastructure spending for decades in the name of keeping costs down for those with mortgages at the time, we pulled the rip cord with low interest rates and removal LVR restrictions and gave everyone money for not working while having supply side inflation adding to the fire via fuel prices. We now want to be like europe with long-established infrastructure like public transport but we dint have the money to pay for it and are in a long-delayed economic downturn. This is the reality, cold and hard. We never sorted anything out, and we gave the head of the RBNZ double pay and a 5 year contract for their so called contribution. We must engage in government of all levels and demand better.
Good summary.
We are CAPEX-heavy and OPEX (Govt. bureaucracy aside) light in NZ.
The maths is simple, we would be far better off if housing was more affordable (which it could be) and the true cost of operations was charged, rather than what it is at present.
Of course, to make this changeover, there is unfortunately a group of recent purchasers who will have paid too much and then will also have to wear the higher rates etc.
"We are CAPEX-heavy and OPEX (Govt. bureaucracy aside) light in NZ."
I'm not sure this is correct. NZ's tax rules favors OPEX over CAPEX. (It's one of our reasons for our poor productivity when compared to other OECD countries. Increase production? Add another worker.)
I was referring mainly to the capital cost of buying land and consenting, although some of this flows through into the build as well.
NZ land and housing is approx. 1/3 to 1/2 higher than it needs to be due to Govt. land use policies. Conversely, we have been under-investing (bureaucratic waste aside) in our operating cost side for years. Not just council but NZ housing has a huge amount of deferred maintenance.
That's a good question. If it was a proper competitive business and the government slapped a big tax on it, would they put up their prices to match, or would the value of the business drop due to reduced profitability? I guess it depends on whether their is demand at higher prices.
That depends on the elasticity of the product. Taxing cigarettes reduced consumption over the long term but tax on alcohol had little effect. For a necessity like housing, people will simply pay the higher price.
"people will simply pay the higher price" - why not double rents tomorrow then, yields are already very low?
More people will move back to parents, have extra flatmates, move city / country, live on the streets, etc. I feel like the elastic is already very stretched.
I'm guessing the $28 per week average increase in rent in the article is due to altruistic reasons?
Landlords should really be increasing rent on average by at least $50 - $75 per week each year, ad infinitum. It is a business after all and they have costs to cover.
The same as any business with lack of competition would. LL would charge us $1m per week if they could get away with it. That's why we need rent controls and tougher on LL tenancy laws
Yes, if it was just about improving the yield the quickest way is just to accept that your property is worth less, and that will come about in two ways. Present developers taking a financial bath, and more liberal land supply and consenting (which the Govt. have on the cards).
There is nothing more sobering has what you should set as rent than having an empty rental property that you can't rent at the rate you are charging, unless of course, it is to recently evicted Kainga Ora tenants.
people will simply pay the higher price" - why not double rents tomorrow then, yields are already very low
because the inelastiscity for rentals doesn't extend to that range. We are talking about inelasticity in the short term and in the 10-15% range, not 100%.
Good comment 1689.
Alas, it is clear from the replies that concepts like the elasticity of demand / supply fly over most commentator's heads. Pearls before swine.
Median rents always drop or remain static over the summer in Auckland. Over the course of six months Auckland rents have.gone up 18% annualized. Way above the rate of inflation. Interest, rates, insurance costs are slowly filtering through to the tenants.
It's a terrible business model. These aren't customers, they are people requiring a roof. Squeezing them to cover business costs is morally wrong. I'd prefer to be having conversations on this website about how well our NZ made vehicles are selling, or our super yacht industry... but as a collective, we are too short sighted for that.
We need Landlords.
What we don't need is a loose and easy credit system that enables huge swathes of people born earlier to leverage 100% of the purchase price on a rental, outbidding the younger aspiring home owners (on homes that already exist) who need to save cash for a deposit, do not qualify for tax relief on their mortgages and generally do not qualify for interest only loans.
Despite denials the business model of rental was - was - capital gain.
But that was then. No capital gains now means there will be some big big trending changes in how it all works. I have some predictions, but trust none of them.
I'd like to hear those predictions please KH?
Most likely prices will slide down to about half of now. That is revert to normal.
Or: Less likely. After a plateau they will rise only gradually for a number of years.
Take ya pick.
And - landlording will only viable if the landlord is a true investor. ie: using ownership, not debt. The "borrow big and hope" model is dead.
But remember, I trust none of these predictions.
House prices won't be going down. New builds are getting more expensive, the cost of subdivision keeps escalating, and ten of thousands of immigrants are arriving.
I agree KH. Rightly or wrongly I would guess I have averaged about 12% return in my 15 years in property investment. 4% in rent and 8% in capital gains. Looking ahead to the next ten years I estimate I am likely only going to average 7-9% return. 2-3% in capital gains and 5-6% in rent. House price growth will be sluggish or non existent, but rents in NZ will grow levels similar with comparable countries.
Is that return after accounting for the costs of holding the property, or just based on nominal house price increases over the period?
The former.
Looking ahead to the next ten years I estimate I am likely only going to average 7-9% return. 2-3% in capital gains and 5-6% in rent.
Penny for your thoughts. How does your forecast work? What's it based on?
There is not a lot of science in my extrapolation. I predict that unaffordabilty, tighter lending criteria, tax changes, and high immigration will drive the shift in my particular portfolio.
There is not a lot of science in my extrapolation. I predict that unaffordabilty, tighter lending criteria, tax changes, and high immigration will drive the shift in my particular portfolio.
So you extrapolate growth into the future and then know off a few pp.
Landlords agreed to subsidise tenants living in their property in return for capital gains. That was the accepted societal bargain. Without capital gains who is going to be willing to "top up" the cost of holding a property for the long term? Nobody.
https://www.stuff.co.nz/money/350220152/investors-have-top-rent-payment…
So either rents have to increase to a yield that allows a rental property to be cashflow positive AND still provide a return on investment on the owners equity, or (b) house prices have to fall substantially so that existing landlords go bankrupt (along with the banks) and new investors get to buy them at the mortgagee sale for prices that achieves (a).
Pick your poison.
Landlords are not subsidising tenants - tenants more than cover running costs associated with the property. The losses are nothing to do with tenants and everything to do with the landlord paying way too much for the property and not using their own money to do so.
Let's get this straight - landlords are subsidising the banks and the previous owner of the house. Not the tenants.
If the tenant is renting the property for less than the cost of owning the property, they are being subsidised. The reasons why they are being subsidised are immaterial. The fact still remains that the landlord is paying real cash for someone to live in that property. And the only reason why landlords accept continuing to run that property at a loss is because they expect to make up those losses in capital gains down the track. Again, if there is no capital gains, why would anyone continue paying for other people to live in your property? You would sell up and go buy something else - shares, bonds, commercial property .....
HGRW: That was a self deceiving comment.
.
It's actually back to front, Tenants had said we can only rent with subsidy, if you want the speculative gains.
And this is where people start forgetting the difference between speculators and true landlords.
The initial capital gain is to adjust for inflation, but there has been this super speculative margin (because of restrictive land use and consenting policies) that stuffs up the yield formulas.
In places like Texas where there are very little speculative gains, then almost all the income is with rental yield. Their housing is 1/2 the cost relative to income, their rents are not half the price (because of the no speculative gains) but are still way more affordable than in NZ.
And there is still good money to be made in Texas by developing, but it is due to adding value-added amenity costs, not sitting and doing nothing on a property like speculators can do in NZ which is a form of non-value-added cost.
The Lets do this lady should have studied Texas herself, or even easier read your comments here. So lets hope Bishop is not another grinner and he is actually busy doing. He's given himself till the end of the month
So either rents have to increase to a yield that allows a rental property to be cashflow positive AND still provide a return on investment on the owners equity, or (b) house prices have to fall substantially so that existing landlords go bankrupt (along with the banks) and new investors get to buy them at the mortgagee sale for prices that achieves (a).
Could you imagine a business manager at Nestle say that a Nescafe pack must increase to $10 for the product to be commercially viable if we know a customer' share of wallet for Nescafe is only $8?
Is it safe to assume that NZ tenants can pay more for housing while spending less into other sectors of the economy? I don't think so. Because taking this to an extreme, you could argue that renters should spend all their wallet on non-discretionary goods and services. That would be devastating for a developed economy. The usual rebuttal of this is that non-renters will have extra income to spend into discretionary, therefore there is no real change in aggregate demand. Possibly. But I remain skeptical.
That is exactly what a product manager at Nestle would do. Either the price of Nescafe goes up, or Nestle stops making Nescafe. Or in the case of food goods, the amount of Nescafe in a pack is cut to 75% volume. What Nestle would not do is to continue producing a product line that runs at a loss. This is a decision currently being played out in every company globally. Why should the rental market be any different?
What Nestle would not do is to continue producing a product line that runs at a loss. This is a decision currently being played out in every company globally. Why should the rental market be any different?
You have learnt well young Jedi
'Is it safe to assume that NZ tenants can pay more for housing while spending less into other sectors of the economy?'
This has already been happening for years and is part of the 'elasticity' mentioned by others herein, but a balloon can only be stretched so far before it breaks, and I think we are almost at that point.
The other option that you di not mention is that house prices/landlord costs stay more static, and wages increase so relativity tenants are not paying more.
We're on the same plane. But I think you will find the incidence of 'nice to have' businesses has been increasing - producers of craft beer, artisan foods, coconut yoghurt. Those businesses are more risky than those producing white bread ('white death' as we used to joke).
In any feudal society, it only really works when the majority are serfs. You cannot really have an inverted pyramid.
That's a good comment NZDan
What we don't need is a loose and easy credit system that enables huge swathes of people born earlier to leverage 100% of the purchase price on a rental, outbidding the younger aspiring home owners
Bang on. Just as debt can be argued to be a bet against future resources, the true resource we are betting when allowing leveraging equity in this manner is the welfare and opportunity of the next generation. Let that sink in.
But tenants are customers. Just because housing is a necessity doesn't mean it doesn't have a price.
This jump is driven by uni students in uni towns It will not repeat each month its a January thing
In Auckland the uni student glut actually drives the median rental down. As lower price cbd apartments that have sat vacant in the summer are rented out.
It looks like university enrollments have been trending downwards which might be reducing a bit of housing demand compared to previous years.
13 Mar 2024 — "Our advice is that we're going to get downward pressure on rents, because essentially, the costs are not being passed through to renters." RNZ 13.03.2024 ... "Rents in Tauranga are even higher, climbing $55 on the year prior to reach a new record at $695, making it the most expensive city in the" Sunlive 29.08.23...
My Neighbours have moved out and relocated rural ....both on very healthy incomes ...I guess the downward pressure will come too late for many.... if it ever appears...lol My guess is many recent rent settings probably made before interest deductibility featured so Landlords likely will be popping the cork on another bottle.... More wine for the Landlord ! Until supply exceeds demand zilch will change ....
Insurance increasing 30%.
Rates 20% up.
User pays.
lol...The user can only pay what the user has....and I suspect many users are close to the breadline ....lol
nktokyo, it's the Owner Occupier/Investor burdened with the additional rates, insurance and interest. Unfortunately for the latter, tenants are already tapped out. You said so yourself, it's a good time to be a buyer!
by nktokyo | 16th Mar 24, 7:51am - "Good time to be a buyer. Don't pay asking"
Right now, it's not so good being a leveraged owner.
I'm a buyer. Will report back later to the complainers.
This reinforces the fact that rents are driven by what tenants can afford to pay and supply of houses. Interest deductibility will have a zero to minus benefits to renters. It's purely paying back their donors, just like tobacco and cancelling ferry, rail, public transport, walking and cycling funding (road forum).
This is the most corrupt government I have lived under since I moved to New Zealand. Just because the corruption isn't as bad as third world countries doesn't mean we should accept it. It's the UK Tories austerity + enrich the rich playbook.
Nah Lock us up Jacinda , and fire you if you do not take an experimental untested vax and try to give Iwi co-governance without a voter mandate was the most corrupt, hence as a democracy we kicked them into touch.
These guys are doing what they said, hard to call the corrupt, the people considered them the least worst choice..... which shows you how much they HATED the other side, so much so Jacinda had to be disappeared. A PM so hated she had to go into virtual hiding to allow her party the remotest chance of election.
🤡 if it were down to lock us up Jacinda, rents in Auckland would be worse than anywhere else as we were locked down more.
You truly drank the cool aid on anti-Jacinda sentiment.
Oh well, I've seen this play out before, if this rabble don't get booted out pronto, in about 10 years when core services have been eviscerated, the young and talented have left, there is a social underclass that has no respect for the social contract because the social contract has been ripped up by those in power, when it's impossible to get either party to agree on anything then you can look back and remember I said I told you so.
Anti co-governance hysteria =MAGA = Brexit rhetoric = anti-immigrant sentiment = Fire up the angry old white men by giving them a bogeyman to blame
The young have left due to the flow-on effects of the incompetency of the RBNZ and the 6th Labour government. Even if another party or coalition were voted in they were left with the hangover of the labour ‘party’ And all that ties back to gratuitous increases in house prices. We were in for this no matter what the election held.
Over the last 8 months we have had 4 young people leave. Two to Europe, one to Oz, one to Canada. Two specifically have mentioned it's because National and Act had indicated they wanted to re-inflate the housing Ponzi (by reversing Labour's housing policies).
They are all highly qualified, woke, appalled at the mysogenistic vitriol targetted at Jacinda, fairly angry at old white men (ACT supporters in particular).
I have not met a single highly qualified young person that left who mentioned it was due to Jacinda, co-governance, interest deductibility, speed humps or pot holes, the tightening of tobacco rules, treaty principles or concerns about beneficiaries taking more than their fair share.
But anecdata isn't data, unless of course you are Simeon Brown, Chris Luxon or David Seymour.
Young people are not really interested in politics, and have always left for more exciting places. What should be concerning you is the older people who are packing up their families and shifting to Australia. These are the highly skilled and productive people (doctors, nurses, teachers, software engineers, tradespeople, business owners) who the country needs, not the young ones who want to go be a bartender in London for a few years.
Many are taking their kids and leaving, not just because of the dire state of the country's health and education system, but because they dont want their kids growing up in a country with racist policies that will discriminate against them.
And good luck to the one in Canada. There they will find that Justin Trudeau is hated as much as Jacinda Ardern (and for exactly the same reasons) - and the vitriol directed at both of them has absolutely zero to do with their gender.
https://www.dailymail.co.uk/news/article-12952085/Justin-Trudeau-Canada…
"The end looms for Justin Trudeau: Canadian PM plummets in the polls as 70% disapprove of him"
Many are taking their kids and leaving, not just because of the dire state of the country's health and education system, but because they dont want their kids growing up in a country with racist policies that will discriminate against them.
When you say "older" people what age group are you referring to. Because it looks like the vast majority of them are in the 18-40 bracket compared to anything older, and I would say the 30-40 bracket is of the most concern since those are prime earning years when workers are at their most productive.
And assuming the reason they are leaving is because of racist policies seems like a massive assumption to make backed up by your own biases rather than any actual evidence to that being the case.
Maybe it's my own biases at play here but I would say it would be a safe assumption to make that the cost of housing and the economic situation in New Zealand is a much more potent driver than social policies that honestly don't have that big of an impact on anyones day-to-day lives.
Did a bit more digging, and evidence points towards economic reasons being the primary driver for leaving.
- 50% of those looking to move believe they’d attract a better salary abroad
- 44% considered moving for an improved quality of living
- 21% said they’re looking to move because NZ can’t offer the lifestyle they want
100%, we are in this boat (did the OE, came back, left again a few years later, older, more experienced, young kids). To be completely honest it was purely to do with house prices vs maximum earnings, we left at the height of the bubble late 2021 as we desperately wanted a house to call our own and couldn’t see a way forward in NZ. So is it Labour or Nationals fault? Both really, it’s a problem which has been a long time in the making, by two parties too reluctant or cowardly to rock the boat by making any real change. Tho, I do think National are worse, at least Labour try to care. So, we won’t be back anytime soon.
Good riddance to them, less wokesters the better
You still mad you lost the election huh, wahhh don't cry
Where you from originally Ag?
Europe and UK, but I moved around quite a bit when I was there and also lived in OZ.
Apart from Vienna, any other particular housing approaches that inspire you from Europe?
Who did you think would pay for all the increases in the home owners expenses?!
Correct, the renters!
If the renters are indeed paying for the landlords expenses then that massively strengthens the case to tax the landlord's capital gain.
The figures also suggest that student accommodation in Otago may not be as popular as it once was.
The number of bonds received from Otago peaked at 3081 in January 2017 and have declined in every January since to 2298 in January this year, a drop of 25% over the last seven years.
I don't get how less student bonds meant much higher rents up 30perc/$155 in one month. Maybe more permanents staying on over summer driving a shortage of accom
I disagree with the articles assertion too. From what I understand, in Dunedin landlords rent houses to students throughout the summer as well. Flatmates come and go and the principal Tenant may change, but if the landlord isn't greedy, rental contracts can last decades.
Remember how everyone years ago was saying that Labour's changes to tenancy laws would kill the student housing market? Well, looks like that is true. Landlords have simply switched from renting to students to renting to non-students, as the inability to sign a new lease on a student house before the current tenants move out meant long vacancy periods over the summer period.
Once again, Labour achieved the exact opposite of what they intended. Add to that the dire lack of seasonal worker accommodation in Queenstown as holiday homes were removed from the medium term rental market and forced to sit empty or be AirBnB.
When is National reinstating fixed term tenancies?
If anyone is genuinely interested in housing affordability and planning laws then this article is a good intro. The first test for Bishop under this new coalition will be whether he approves the Wellington City Council recommendations for their plan (they go further even than Auckland's Unitary Plan) and indicates he is actually serious about addressing housing (ownership and renting) affordability.
https://www.stuff.co.nz/politics/350218439/can-chris-bishop-pull-housin…
I read that through but am none the wiser, there's too many options and opinions on the way forward. Bishop still looking into it, they won't have finalised plans within 2 or even 3 years since being elected
That article got me even more infuriated with ACT for their influence over housing density plans. Those in leafy suburbs like Epson are holding the country back.
Wow have some respect for those that worked hard and can afford to live in those leafy suburbs. Try living somewhere else until you can afford to move there and I'm pretty sure you will change your tune.
By worked hard do you mean own multiple investment properties from the days when they would pay themselves off in 10 years of rent and still have maintenance money to pop aside for when needed, or buy 20 years ago when prices and DTI for mortgages were reasonable?
This is nothing to do with whether they have worked hard or not. We're trying to improve productivity remember. Having large sections in the middle of the city with few people really doesn't help that or make for efficient public transport. The whole country's land planning shouldn't be controlled by these people.
A-GREED
The epsomites think of themselves as special.
Rubbish the number of entitled people around these days kind on makes you want to puke. You get to move into the likes of Epsom or Remuera if you can afford it. By the way I do not live in either and all the people I have met that live there are assholes so its better that they all live together in one area that can be avoided when you buy a house elsewhere.
Isn't the issue that people who can afford land there, can't 'work hard' to develop that land to have more accomodation on it?
The free market is being held back by 'red tape' isn't it?
Height and density rules are one important aspect. But just as important is the amount of discretion council planners have.
Need to land on a standards based approach where discretion and subjective judgment is markedly reduced.
Too much red and green tape, there has to be cut through
A seriously deficient article - may as well have been written by NZ Initiative/Business Roundtable. (Expanded reasons for saying this given in my comment towards the beginning of the comments section.)
Overseas, some call ‘the progressive YIMBYs’ the useful idiots for the development sector
Better that than USELESS idiots
I said back in November there was going to be a big jump in rents coming. That's because the net passenger arrivals number for October (79,474) and November (40,094) was so huge. There is simply a lag between all the arrivals and the time it takes them to find a rental and move in. Not rocket science.
Wait. Are you saying that people are being let into this country without somewhere to live? 120,000 people living in caravans, under bridges and sleeping on couches until they find a rental?
When you can fit 30 to a 3 bedroom house and orchard workers are being encouraged to "camp" in their own vehicles on land, yeah it is fair to say a significant % come in with no adequate housing to live in. But that is nothing new. NZs major comms companies used migrant workers who were forced to camp and sleep in hostels instead of provide employment contracts to locals (with the same or better skills experience) or a living wage to afford housing.
Of course. 100% sure that having a signed rental agreement is not a requirement for being issued an immigration visa. Most landlords are also not going to sign up a tenant they havent met in person or verified their income. People arrive here and stay with friends, family, in motels, AirBnBs, serviced apartments, backpacker hostels ..... Then once they have a job, and a payslip, they go look for a rental property.
Wow just look at that picture, is that what goes for a "House" these days in Auckland ? I think if I owned next to no stuff, I would just live in a luxury motorhome and just keep moving around all over the country.
Parents pay for school zones, we don’t even have enough schools, things ain’t easing yet.
Sorry kids we are moving, say goodbye to your fiends….
Out in the bigger world, two San Francisco office buildings bought for $949M in 2019, have been marked down to zero.
Market Center and 111 Sutter were acquired by Paramount Group for $722M and $227M, respectively. The owner said on an earnings call that they are in negotiations w/ lenders, but both investments have already been marked down to zero on the company books.
https://sfstandard.com/2024/03/04/paramount-group-downtown-trophy-build…
"Executives say debt on the buildings far exceeds their current market value."
That's because of vacancy, what did those execs actually do to earn their pay
Thats what happens when your Govt turns your city from a once wonderful global icon of a city, into a socialist utopia for homeless drug addicts who crap in the streets. Then piles tons of new taxes on everyone to pay for all the illegal immigrants' housing and free medical care. San Francisco has lost 7% of its population over the last few years as people flee the place. People and businesses are moving out of California to low tax States like Florida, Texas and the Carolinas. San Francisco is becoming Detroit. The same thing is happening in New York.
https://www.latimes.com/california/story/2023-12-22/california-loses-po…
https://www.timesunion.com/capitol/article/new-york-loses-101-000-resid…
New Zealand risks the same as everyone leaves for Australia, and is replaced by immigrants from the Third World. 74,500 New Zealanders left NZ permanently last year. Lets hope our new Govt can turn this ship around.
Awesome strawman you've got there.
If property investment dreams of grandeur don't work out, there's always the meth trade. Ralph Vuletic would have been admired widely by suburbanites.
https://www.nzherald.co.nz/nz/crime/jail-for-ralph-vuletic-right-hand-m…
But didn't property 'expert' Grant Robertson tell us rents would decline as he shafted landlords?
Amateurs are always calling for a CGT. Well there is already a de facto CGT, but if landlords and property owners make losses, then it works in reverse...the govt will be coughing up.
And if it's such a road to riches why aren't more doing it? And also on this subject, maybe someone can tell me why there's 40,000 empty houses in Auck if being a landlord is the way to joining the nouveau riche.
When did he say rents would decline?
He shafted landlords to get rents to decline, but instead ol' Robbo's 'good idea' made rents go up.
Because he's not the sharpest knife in the drawer. Otago University drew the short straw there.
It would be really good if you could provide his exact quote because I think I follow this stuff closely and don't remember him ever saying rents would go down. I feel like you're just making it up.
The policy was to cool down investor buying who were crowding out the market from everyone else when the market was going beserk mostly fueled by investors. It has been working as intended. It wasn't about rents.
It's BS when National say reversing it will cause rents to increase less. They know it's BS too.
You could start here....but unfortunately for Robbo, they went up.
https://www.newshub.co.nz/home/politics/2021/03/housing-crisis-tenants-…
Nothing in the article backed up your claim that Robbo said rents would decline, but it did highlight a point which may answer your other query:
if it's such a road to riches why aren't more doing it? And also on this subject, maybe someone can tell me why there's 40,000 empty houses in Auck if being a landlord is the way to joining the nouveau riche
Maybe it's because of this kind of one-sided-ness (from the article you linked):
We saw last week four professionals, near on $400,000 combined income, parent gifted the deposit. It was declined because the deposit was gifted.
Wingman, no where in that article does Grant say that rents would decrease. I'm not a fan of the man or his policies but let's be fair to him and at least not misconstru his views.
The exact quote was "Finance Minister Grant Robertson says it won't "necessarily" push prices up, because renters have the option to "go looking elsewhere".
https://www.newshub.co.nz/home/politics/2021/03/housing-crisis-tenants-…
How's that working out for tenants? I'm sure they have all found somewhere cheaper to live by now. They can send their thanks to Grobbo at Otago Uni.
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