Auction results: Two bedroom home unit in Auckland sells for $1.172m

Property

A million dollars was not enough to buy a two bedroom home unit in the overheated Auckland market

28th May 16, 5:02am by Greg Ninness

The highlights from Bayleys latest auctions around the country included a two bedroom home unit at Greenlane in Auckland, which the marketing material described as "first home magic or investor's delight." It sold for $1.172 million.

Over on the North Shore a vacant 600 square metre section above St Leonards Beach sold for $1.72 million.

Bayleys also had a busy week in their Hamilton auction room where prices started at $338,000 for a three bedroom house at Nawton.

We also have Bayleys auction results from Napier and Havelock North.

See below for the full results, with details and photos of all properties including those that didn't sell:

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91 Comments

by Su30 | 28th May 16, 8:11am 1464379863

Pretty solid unit at a pretty solid price! Perhaps buyers are anticipating few more cuts.

by Gloom | 28th May 16, 12:32pm 1464395548

This unit is half share 960m2 land in grammar school zone, 2 min to motor way and 2 min to shopping.

The land should worth more. My 2 cents.

by President of P… | 28th May 16, 8:13am 1464380021

My reaction is somewhere between f#*k and oh my gosh and that's having a block of units in Ellerslie.
How are people ever going to compete with these price rises. There goes the retirement plan as I consider my young childrens chances of affording a property of their own. Don't want to doubt their future success but the bank of mum and dad might be their only chance. That or not Auckland that's for sure. Too crazy but the door has been opened to the kiwi dream and they can't seem to close it (free trade agreements etc) now it's turning ro nightmare on elm street. I wonder when it will settle or if today's process will seem like axes and blankets in the future.
President of Property

by Andrewj | 28th May 16, 8:44am 1464381868

PoP, I wouldn't worry about it, this is the normal pattern of asset bubbles. They do self correct.

by Su30 | 28th May 16, 9:16am 1464383763

Pop? I'd say not. Many here who could have bought previously are still waiting for that 'pop'. Pop is highly unlikely given the current scenario.

by xelnaga | 28th May 16, 9:57am 1464386270

"Highly unlikely"?

Take a browse through TradeMe and benchmark the asking prices against Sydney, Melbourne, Brisbane or Adelaide. They are nervous about the bubble over there. But Auckland is the bloody twighlight zone. Given the salaries in Auckland. It's a mania. It's mass delusion. It's unmistakeable. The danger siren is flashing red.

If you're young, run away as fast as you can, life is too short. There will be tears.

by Su30 | 28th May 16, 11:33am 1464392020

Xelnaga, I agree with most of what you say I.e prices are out of whack and especially 'life is too short' :) but I also do not see any of the push factors abating any time soon and hence I do not believe in a pop anytime soon. Pop seems like wishful thinking from where I view the world.

Also, some of my colleagues in IT are thinking of what you suggest if I understand it correctly. They plan to go overseas to earn faster. Couple of them already have.

Luckily I did not speculate or plan to and hence not too worried if I am wrong.

by xelnaga | 28th May 16, 12:15pm 1464394524

Prices are only going up because they are going up. That will stop sometime. Then what? Who is going to buy an awful flat returning a 2.0% gross yield.

Indeed. I am also overseas, working in IT and looking in from the outside at the insanity. Leaving is the rational choice. The savings stack up a lot faster.

I see Yellen making more noises about several US rate rises this year. Should punish the NZ dollar :)

by Kakapo | 28th May 16, 12:54pm 1464396860

I wonder if we're really getting down to the unsophisticated follow-the-crowd investors. Smart money went into real estate in Canada, London, Australia etc years ago, and now we're down to the mums and dads falling for the Chinese equivalent of Blue Chip Apartments advertising.

by Independent_Observer | 28th May 16, 10:23am 1464387812

How many houses do you own Su30?

by bigblue | 28th May 16, 12:18pm 1464394700

This ain't gonna correct at all Andrew J at least not while Jonkey has the immigration floodgates wide open. All you require to get residency here is to buy one residential rental property - the only country in the world where you can slip in that easily and wash your cash eh! The Chinese Mums and Dads have their secret agent student children in a frenzy in the auction rooms of Auckland. The IRD data showed 35% of house buyers are foreign students - who is funding them - Mum and Dad back in China. The lawyers and the Barfoots agents and the valuers and mortgage brokers/bankers all know what's really going on but keeping it under cover as they are making a fortune from this immigration scam. Twyford was right - 39% of Barfoots buyers with Chinese names = a connection to family back home with the students fronting the house hunt in NZ. Not racist simply fact!

by President of P… | 28th May 16, 8:20am 1464380425

by Penguin | 28th May 16, 9:07am 1464383258

This is the way of the world. Rising house prices doesn't necessarily mean better quality of life.

http://www.ft.com/intl/cms/s/2/d6f1e58e-20c9-11e6-aa98-db1e01fabc0c.htm…

by xelnaga | 28th May 16, 9:12am 1464383574

You could buy a better flat in London for that price. Lunatics.

The price quoted for the section is incorrect.

by Cowpat | 28th May 16, 9:31am 1464384715

The Greenlane property at price to rent ratio of around 50 ,( rent 500 pw similar available at present on trade me , two weeks vacancy period. )Given 15-20 p/r ratio normally reflects sound judgement on whether to rent or buy, one can only assume the purchaser anticipates continued capital gains.

by xelnaga | 28th May 16, 9:57am 1464386224

Sounds like a perfectly legit investment. Don't you know next year it will be worth two million and rent for 525 pw.

by iconoclast | 28th May 16, 10:20am 1464387627

Greenlane has a number of things going for it

Railway Line runs right through it
Has a Greenlane Train Station
Two stops-stations to the city
Southern Motorway runs through it
5 Minutes to City in off-peak traffic
Greenlane Hospital just up the road

by Sluggy | 30th May 16, 9:10am 1464556220

And 1.172 M things going against it

by Zachary Smith | 30th May 16, 9:15am 1464556524

It must be worth something surely. It is half a full section in prime DGC Central Auckland. If they want 500k+ for 250 sqm in Hobsonville then 1000 sqm in that location is worth +2,000k easily.

by Fritz | 28th May 16, 10:04am 1464386653

There is no question whatsoever. Auckland is a speculative bubble.
Tell me of one bubble that has never popped....
The pop will come, the country will sink, and our pathetic politicians will look to blame anyone but themselves....

by bigblue | 28th May 16, 12:19pm 1464394768

Not gonna pop Fritz while National keep the floodgates wide open.

by BadRobot | 29th May 16, 4:50pm 1464497415

That is not necessarily true - it depends on a large number of factors most of which are pointing in one direction at the moment. If something happens in China and the parents of Chinese students are no longer able to pay for their children's education in New Zealand, other foreigners decide that emigrating to New Zealand is not worth while due to the lack of well paying jobs, boring lifestyle and the exorbitant house prices or those that are here decide it was a mistake and leave - Auckland could be in trouble.

by CJ099 | 29th May 16, 10:22am 1464474159

Yes that's already happening. As property prices increase then so most rents, salaries aren't increasing if anything they're going down with the influx of the less skilled and educated migrants pour in to NZ from less developed countries.

In the long term this will have quite a negative effect on New Zealand causing quality migrants to massively decline. So the main warning signs to look out for are: 1) When rental properties start to sit on the market. 2) Retail stores are in perpetual sale mode. 3) Business start to close and relocate out of NZ due to not being able to find staff - this will probably start to happen in the IT sector first.

by BadRobot | 29th May 16, 4:57pm 1464497857

True about the IT sector - a great deal can be done remotely - infrastructure and network engineers don't need to be next the the device they are configuring, programmers can work anywhere in the world. Only problem is if a device needs to be rebooted - that can be interesting....

by Kiki San | 31st May 16, 6:27pm 1464676063

Sorry but that sounds like a Eurocentric view of the world and so probably lacks informed insight to Chinese social aspirations.

by xelnaga | 29th May 16, 3:27am 1464449230

You're right big blue. Key is the new Muldoon. Think Big - Immigration Edition.

If Winston ends up holding the balance of power come next election though. It's game over.

by head_down_bum_up | 28th May 16, 1:48pm 1464400082

We know it's a bubble.

But for most people it only becomes a bubble when the media say it is. the herald, stuff, one news etc. Once these guys start pushing the 'bubble' term every week over a month then people start to think 'shit, it might go down, lets wait and see'. And that's the point when it pops.

The side issue is are enough of those buyers actually in NZ to be exposed to that news and think the same.

It will come, it's just a matter of when and how big.

by Zachary Smith | 28th May 16, 1:56pm 1464400568

It is possible that places like these are good for parking 500k. The rent can cover the extra 675k needed. Has owning a property in a premier city in a majority European country, especially British, become a status symbol or fashion item for the Chinese?

by CJ099 | 29th May 16, 12:51pm 1464483100

@ Zachary; No it don't think it's a status thing. More likely it's a combination of hiding capital from their Governments and money laundering.

Though the thing that worries me, and probably all of us, is that 'finance tap' could be turned off at any moment and it's completely beyond New Zealand's control. Selling out like this will just eventually lead to a crash and the longer we leave it the bigger the recession melt down.

by Zachary Smith | 29th May 16, 1:45pm 1464486338

I think it is a bit more complicated than that. The whole it's 100% money laundering thing sounds like claptrap and it suits certain people's biases to claim that. There are a lot of wealthy people in China and the gap between rich and poor is quite large so the wealth is somewhat concentrated in a small for China but huge for NZ group. They too have had a massive real estate boom so a lot of money has been made locally.
House prices aren't dependent on a continuous finance stream from China either.
Up until now investing in the premium British heritage cities has paid handsome dividends for them and they still have confidence in those locations.

by BadRobot | 29th May 16, 3:14pm 1464491675

You mean the Anglo-Saxon debtor countries....

by Independent_Observer | 29th May 16, 4:31pm 1464496318

ZS - could you please explain to the readers of this site how exactly a real estate boom makes people 'a lot of money' as you put it above?

I think you mean it makes a lot of people very indebted and others owners of overvalued assets whose value can only be realised by actually selling the asset and turning it into cash\ or buying something else. And we know if everyone does that at the same time, then the value of that asset group drops dramatically. So that group that thought they had made a lot of money had actually made no money at all. I can see how you might fall into that illusion/trap that a lot of money had been made. Especially if you think markets only ever travel in one direction.

by Zachary Smith | 29th May 16, 6:19pm 1464502741

Not so long ago in China a lot of apartments were given to workers. Communism is weird in that it glorifies the worker rather than the citizen. Well, the workers got to keep their apartments. At first they were cheap but then the market started to heat up. Many old workers passed away or sold up and followed their children to the Western lands. Swarms of people headed to the cities from the countryside so demand stayed strong. Some astute people bought multiple apartments....oh come on this is baby stuff!

And we know if everyone does that at the same time...

Never happens in the premier cities. Why would everyone sell at the same time? Are they all going to head to Eastern Russia or something? People are dying, literally, to get to the advanced anglophone countries.

by KH | 28th May 16, 11:04am 1464390290

"Apartments in Melbournes Docklands, CBD and Southbank are being resold up to 24 per cent below their previous off the plan purchase price" Fresh news in this weekends Australian Financial Review courtesy of the Melbourne Airport Virgin Lounge.

by Mystery | 29th May 16, 2:04pm 1464487496

They have built too many apartment in Melbourne, that's why the prices are dropping. It's not exactly 'New" news. The glut of apartments there will only increase in the next couple of years as the apartment building projects which are currently under way near their completion. Melbourne house prices on the other hand are going up. Auckland has a shortage of houses so 'supply and demand' dictates that they are not going to drop in price given today's fundamentals. Apartments here might suffer a similar fate as the ones in Melbourne one day because it's easier to build apartments, they require little land. A free standing house in Central Auckland is not likely to ease in demand until the fundamentals change, same as in Melbourne, or Sydney, etc. At this stage the fundamentals are not looking like they will change for a while.

by iconoclast | 29th May 16, 8:34am 1464467688

A ghost town

Docklands - Melbourne:- Noticeable as you drive though the Docklands precinct of an evening, after dark, is the absence of lights on in these apartment buildings, in the main at best 10% have lights on. It doesn't appear many people live in them. They're largely unoccupied. I suspect they are largely owned by off-shore investors who are not in-residence. It's a ghost town

the Melbourne experience means Chinese Developers, building the buildings and selling them directly off the plan to Mainland investors, never reaching the domestic market

June 2015
http://www.interest.co.nz/opinion/76159/aucklands-housing-market-faces-…

by Zachary Smith | 28th May 16, 1:48pm 1464400133

The unit was sold for 61% over CV. I went to the open home as I bought something similar last year. It is an above average unit set one full section back from the road. If the owner can get their hands on the other unit it will be a fabulous section to own. A little bit grander than most but it does share the driveway and the neighbour's headlights will shine into your window when they return home at night.

This is way more valuable than an apartment so cannot really be compared. Solid materials with brick tile and native timbers that just aren't made anymore.
As well as the other features there is a good Countdown within walking distance and shops up at Market Road too with restaurants and takeaways. Extremely good neighbours all around.

It has a nice fenced yard and you could own a dog and go walking around the fabulous parks in the area. Cornwall Park is one of the nicest in the Southern Hemisphere and is an easy walk away and has two cafes.

#Goodbuy! although the neighbour's house sold for only 1m next door about six months ago which I think was nicer. They were poorly advised in my opinion and should not have sold at auction.
Rent could be 600+

by head_down_bum_up | 28th May 16, 1:52pm 1464400341

That's the biggest piece of real estate agent spiel I've read in some time. And I'm looking at housing ads daily.

And wtf does CV have to do with anything, it is so irrelevant in this market.

by Zachary Smith | 28th May 16, 2:03pm 1464401032

IKR? I read the comment out to my wife and she said the same thing, LoL. I should get into Real Estate. CV is of interest as a reference point. Usually houses in this area sell for only around 20% above CV currently so this is remarkable. It would appear that the affordable houses in all areas of Auckland are gaining above CV around 50%. I thought it was just the cheaper areas but it seems it is affordable houses in all areas selling at a premium. This is a terrible 'perfect storm' for the FHB.

by gordon | 28th May 16, 3:30pm 1464406253

Zach where does your current wife come from? She sounds like she is an interesting person.

by gordon | 28th May 16, 3:31pm 1464406313

Zach where does your current wife come from? She sounds like she is an interesting person.

by gordon | 28th May 16, 3:32pm 1464406347

Zach where does your current wife come from? She sounds like she is an interesting person.

by gordon | 28th May 16, 3:32pm 1464406368

Zach where does your current wife come from? She sounds like she is an interesting person.

by Zachary Smith | 28th May 16, 8:26pm 1464423991

I can't give too much away! Remember to be patient when hitting the save button.

by xelnaga | 29th May 16, 3:30am 1464449445

Quadruple post!

Install this chrome plugin to prevent it (and the stupid flag).

https://chrome.google.com/webstore/detail/interestconz-enhancements/ljp…

by keywest | 28th May 16, 5:15pm 1464412552

FHB's should be buying apartments (as will many non-FTB's that have banded together on this website waiting for the crash) any major city sees people in apartments and if you don't like it then move to Kansas

by muntijaqi | 29th May 16, 2:26pm 1464488766

For that we would actually need apartments being built.

by Baza-b1 | 28th May 16, 6:18pm 1464416288

Big blue, I'd say your right. No government will touch doing anything about these "students" washing there money here; it oust them or stop them from buying our land would jeopardises our international trade agreements... New Zealand is for sale, we will become renters within our own native land.

by Zachary Smith | 28th May 16, 8:03pm 1464422598

I just did a search for two bedroom rentals in the DGZ part of Greenlane and there are none currently. The unit should definitely get around $600.
There is a very good primary school a short walk away which is another plus.
It is possible the other unit owner bought this - I wonder if the numbers would stack up in that case?

by mikeo | 29th May 16, 7:01pm 1464505300

$600 per week. I have a unit in Christchurch rented for $380 per week. It cost $180k a year or so ago. Something is wrong here....

by MortgageBelt | 28th May 16, 8:40pm 1464424802

The opinion of many liberal Media and Govt policy people is to encourage increased immigration and increased foreign buying of NZ assets. Which will lead to even higher house prices in Auckland.
http://www.nzherald.co.nz/opinion/news/article.cfm?c_id=466&objectid=11…

by xelnaga | 29th May 16, 12:35am 1464438942

http://www.newstalkzb.co.nz/on-air/kpmg-early-edition/opinion/rachel-sm…

Nice sleight of hand in that load of garbage.

Innumerate journalist compares net migration figures to gross expat return figures then claims half of immigration is due to kiwis coming home.

Question is was it stupidity or cunning?

by muntijaqi | 29th May 16, 2:31pm 1464489096

It is no measure of health to be well adjusted to a profoundly sick society.

Enough already.
Not only will I have no empathy for those who loose big time when the bubble bursts, I will actually enjoy it. I don't care if I look like a bad person, I think this has crossed the common sense line and obviously whoever is buying in this market is moved by greed or by irreversible stupidity and deserves a slap on the face.
I can't wait. It makes me sick. I don't care if I cannot afford a mortgage for a shitty shelter. I refuse to join this ponzi scheme and work for it. I'd rather leave NZ. No sacrifices. I want it destroyed and I want to see pain because this society needs to learn a lesson and there is no other way.

I cannot stand all the people justifying this madness, all the parents encouraging their kids to "get into the property ladder", all the stupid one home owners feeling richer on the paper and smiling at increasing prices not caring about the future of this country, all the mass media cheering "the new paradigm", all the parasite brainless real estate agents giving lessons about "investment', all the banks lending money created out of thin air to fuel this nonsense and all the mindset that has forgotten who and how real value is created and what are the consequences of gambling with future wealth, all this government and representatives doing nothing, all the home owners wannabes complaining not about house prices and prices increasing at a faster pace than wages but about not being able to afford a mortgage "because it's too hard to save for a deposit". What a failed society. How absurd.

So.. yeah, enjoy it speculators, you know very well what you're doing and I'll make sure we remind you later on.

by Independent_Observer | 29th May 16, 2:09pm 1464487773

I'm with you muntijaqi - obviously the country will be in tatters when the bubble bursts, but at least then we could start again and build a society based on fairness and equality.

I don't wish harm to others, notably those who are currently speculating on houses, however when will they consider the harm they are doing to others now who can't buy because of their greed? Some are living in cars as a result. If a crash is the only way for those to become aware of the indecency of their behaviour, then I for one encourage it and like you, look forward to it.

by muntijaqi | 29th May 16, 2:22pm 1464488522

But when the burst happens everybody will be affected, not only gamblers. It won't be that easy to recover from that. That's the sad part.

I do wish harm because I do wish common sense and not reckless behavior to be rewarded and it's the only way. They're not only stealing our present but also our future. Of course I wish them bad..

by Cowpat | 29th May 16, 2:41pm 1464489697

Last weeks M13 inflation release. 74.9% net expect house prices to rise over the coming year, up 11.8 % from previous quarter , price increase expected average 6%.Truthfully what is the point in being productive .

by Zachary Smith | 29th May 16, 4:02pm 1464494524

You can make money in real estate and be productive. The two things aren't mutually exclusive.

Personally I'm quite excited about the future. We are now in a position to make some really great progress with Auckland and the Anglosphere in general. Society is going to be reshaped with a network of high-tech, exclusive, glittering cities. Get in while you still can I say.

by Independent_Observer | 29th May 16, 4:22pm 1464495755

How does Auckland fit into this picture? It's pretty glittering when residents are forced to live in cars.

And for Auckland does 'high-tech' mean a rail system that actually works? Because yeah, that's pretty high-tech.

by Zachary Smith | 29th May 16, 6:10pm 1464502242

How does Auckland fit into this picture?

Things are coming along nicely. Have you seen our Waterview Interchange? And our glittering tower? We're going to skip the trains and go driver-less cars.

You guys seem really obsessed about the handful of people living in cars. You are just using this to bolster your lame doomsday arguments, it's stupid. There are state houses available in the South, a whole country of opportunity in the South.
They should do a show about it, a bit like The Block, but following people making a go of it outside of Auckland.

by positivelywallstreet | 29th May 16, 6:32pm 1464503562

Theyre a humble people Zac but their output per capita is pretty good.
Consider Edendale that runs the local factory. Population about 500 people.
.acknowledgements to the hard working farmers...2.4 billion litres of milk
Annual production 420,000 MT
350,000 tonnes of milk powder
60,000 tonnes of AMF
5,000 tonnes cheddar cheese
4,000 tonnes mineral acid casein
1,000 tonnes whey cheese
600 employees
Four dryers including ED4, the world’s second largest spray dryer at 28 tonnes per hour
65 milk tanker fleet

How does that compare to the output of waterview and the glittering tower?

by Zachary Smith | 29th May 16, 6:37pm 1464503846

They're great those humble people. Keep up the good work I say.

by positivelywallstreet | 29th May 16, 6:48pm 1464504523

Yes,
Round of applause for the humble people of the regions.

by Independent_Observer | 29th May 16, 6:38pm 1464503930

Driver-less cars - are they the ones people are sleeping in?

by BadRobot | 29th May 16, 7:35pm 1464507306

Where is "the South" - south Auckland - Invercargill - where - you say lame doomsday arguments - yet you are using an even worse argument.

by Zachary Smith | 29th May 16, 7:43pm 1464507791

South of the Bombay Hills.

by BadRobot | 29th May 16, 7:54pm 1464508471

But I thought everyone wants to live in Auckland....with all that glitters. You have to take the good and the bad.

by Zachary Smith | 30th May 16, 5:55am 1464544537

Wanting to and being able to are two completely different things.

by BadRobot | 30th May 16, 7:46pm 1464594398

Again you miss the point - it's a comment about your belief that Auckland is such a wonderful place - that it's desirable. Who is going to wipe your arse when you are old and infirm....

by DFTBA | 30th May 16, 2:01pm 1464573680

“All that glisters is not gold;
Often have you heard that told:
Many a man his life has sold
But my outside to behold:
Gilded tombs do worms enfold
Had you been as wise as bold,
Your in limbs, in judgment old,
Your answer had not been in'scroll'd
Fare you well: your suit is cold.' Cold, indeed, and labour lost: Then, farewell, heat and welcome, frost!”

― William Shakespeare, The Merchant of Venice

by BadRobot | 29th May 16, 6:12pm 1464502356

God save the queen
The fascist regime
They made you a moron
Potential H-bomb

.....

God save the queen
We mean it man
And there is no future
In England's dreaming

by Zachary Smith | 29th May 16, 6:29pm 1464503370

I'd say you guys are more hippies than punks.

The whole world is not going to become a socialist utopia. The super-cities and global corporations will dominate the future and yes they will be somewhat authoritarian.

by BadRobot | 29th May 16, 7:09pm 1464505745

Both the left and right are utopic - and neither of the utopic visions are achievable - while super-cities may arise - man may destroy his habitat before then.

I think you miss the point - my comment is not about ideology - it's about your "drinking the Kool Aid" mentality, total indifference to other people and total belief in you own bullshit - you're not John Key are you.

by Zachary Smith | 30th May 16, 8:07am 1464552469

I'm not indifferent at all. In fact I have suggested numerous solutions. Not everyone can live in the best suburbs and in a global marketplace whole cities have become,in a sense, best suburbs. Fact - not bullshit.

by BadRobot | 30th May 16, 6:14pm 1464588859

I never said anything about best suburbs - any suburb - and you are equating Auckland as being one of the best suburbs - now that is bullshit. Not everyone believes that Auckland is a s great as you say it is.

by Kakapo | 30th May 16, 6:29pm 1464589754

Auckland Contents:

Traffic jams: 42%
Endless crappy suburbia: 36%
Swamp: 8%
Real Estate agents 14%
Mike Hoskings: Trace amounts

May contain traces of nuts. If swallowed do not induce vomiting.

by Zachary Smith | 1st Jun 16, 7:21am 1464722503

It's like you cannot understand even the simplest of concepts yet the facts are as plain as day. How many times do I have to write that Auckland is rated very highly globally? Fact not bullshit...LOL.

by Justice | 1st Jun 16, 7:32am 1464723173

Sure is Zac, as a dumping ground for laundering money!

by Zachary Smith | 30th May 16, 6:16am 1464545779

Not only will I have no empathy for those who loose big time when the bubble bursts, I will actually enjoy it.
Just some feedback - hey at least I read your comment, right? If you want to make more of an impact with a statement try to get the spelling right otherwise it is hard to take you seriously. Sorry, calling out the lose/loose mistake is a hobby of mine and feel free to call me out if I goof something up..

by muntijaqi | 30th May 16, 11:24am 1464564257

thanks for the grammar lesson. When someone speaks 3 languages, English being the third one, it's easier to make mistakes.
But I am sure you understand that..
Yes, at least you read my comment, that's all we, humble people from provinces, could wish for.

by dobrydan | 29th May 16, 9:30pm 1464514213

The following link explains why the House market is moving up in the USA. Makes for interesting reading and draws many parallels with our own crazy housing market...

https://nz.finance.yahoo.com/news/housing-market-horror-story-isn-10150…

Taken from the article.

"This divide has tremendous implications for the country.
First of all, home values remain one of the few ways for lower-income families to gain wealth in America. If they don’t want or don’t feel they can get a mortgage, we have to find other wealth-building strategies.

Second, the continuing trend toward the luxury market could create a price spiral that eats away at affordability, especially if mortgage interest rates rise.

Third, housing groups could continue to push to “open the credit box” when that isn’t the problem, exposing those vulnerable families willing to buy a home to more risk. And finally, the economy won’t expand as much if residential housing is a mere playground for the rich."

Sound familiar?

And of course we can't forget ...

"The situation is far worse in the rental markets, where affordability is at a point of crisis."

by MortgageBelt | 30th May 16, 7:08am 1464548908

Auckland schools now forced to buy houses in Auckland in order to attract teachers to a job in Auckland due to the very high house prices which are unaffordable on a teachers salary.
http://www.stuff.co.nz/national/education/80493595/schools-luring-teach…

by ngakonui gold | 30th May 16, 7:36am 1464550577

Most major U.S.cities cannot attract teachers,firemen or policemen because of the cost of rent and buying a house.
Another article I read in U.S.Today said that there was a glut of houses on the market worldwide asking a nine figures sum.
So sorry to hear that.

by MortgageBelt | 30th May 16, 7:47am 1464551256

If a teacher on 60 -70k can't afford to live in Auckland, how does a cleaner or restaurant worker afford accommodation? Will Auckland become like New York, or Mumbai with acres of slums for the low income population?

by Zachary Smith | 30th May 16, 8:00am 1464552044

Theoretically prices should regulate when people cannot afford to buy.
I'm surprised we are not seeing more alternative family arrangements. In this day and age you can have two or more partners earning a good income. One man with three wives could live in a two bedroom unit quite comfortably. Or one woman with three husbands or various combinations for the less conservative. It is 2016 after all.

by MortgageBelt | 30th May 16, 8:02am 1464552148

Just an old fashioned married couple together is a better economic model than many modern living arrangement.

by Zachary Smith | 30th May 16, 8:22am 1464553354

The future will be populated with androgenous, raceless, pansexual consumers. It's what everyone wanted.

by ian64 | 30th May 16, 3:54pm 1464580464

exactly. If they don't regulate it's because we are in a bubble fueled by speculation and cheap money.

by sharetrader | 30th May 16, 8:07am 1464552438

this is a future funding blowout for the government.
are we going to go back where we had to provide housing as part of the package for public servants, teachers, policeman, nurses. or increase their wages
either way this will cost us all more in the long run especially with the population growth meaning we require more people

by dobrydan | 30th May 16, 1:30pm 1464571809

The UK pays teachers working in London a "London weighting" used to be 5000 quid approx $10k more to counter cost of living.
Unsurprisingly the govt have not ventured this way due to the number of professionals unable to afford property in Auckland.

by KH | 30th May 16, 3:26pm 1464578790

The only reason Auckland grows is the inwards overseas migration, is greater than Aucklanders moving out. It's clear that people are voting with their feet for the rest of New Zealand in preference to Auckland. And are voting for Auckland in preference to Mumbai. Both sensible votes in my opinion.

by Penguin | 30th May 16, 6:53pm 1464591217

As the world gets more unstable wealthy immigrants from Asia and Europe will decide to move their families to NZ as it is a better environment than where they currently live. Some will move to Auckland and some will prefer to live in the provinces. For some reason Asians invariably prefer to live in high density cities so AKL fits their wishes.