A review of things you need to know before you go home on Wednesday; no rate changes, retail sales rise; LGFA tender brings a miss, farm sales weak, lifestyle block sales average, swaps slip, NZD firms

A review of things you need to know before you go home on Wednesday; no rate changes, retail sales rise; LGFA tender brings a miss, farm sales weak, lifestyle block sales average, swaps slip, NZD firms

Here are the key things you need to know before you leave work today.

MORTGAGE RATE CHANGES
No changes to report again today.

TERM DEPOSIT RATE CHANGES
None here either.

A STRONG SURPRISE
Retail sales in the June quarter actually came in much better than anaysts were expecting, a surprise because the previously reported electronic cards data didn't flag the jump. This surprise moved our currency up +20 bps on the release although it has slipped off somewhat since. Of every $100 spent on 'retail', $21.40 is spent in supermarkets and that grew a very modest +3.3% year on year, the slowest pace since September 2016. We spend $12.40 on 'food and beverage services' (dining out) and that proportion is taking a larger and larger share. It is also growing at a slower pace than recently although the year-on-year data is skewed by last year's Lions Tour. Spending on 'fuel' (petrol) is the other mover; we spend 9.1% of all our retail purchases on this and it rose at a +6.9% pace, crowding out other spending.

INVESTOR HESITATION
The LGFA tendered $210 mln in bonds with four maturities. In the end the weighted average accepted yield was 3.23% and the coverage ratio was 2.3x. But this hides the fact that their 2027 issue did not attract enough bids to be fully allocated, so that missing $10 mln was made up with extra acceptance on the 2033s. It's has been a long time since any public tender has failed to get full bidding on a maturity.

UNUSUALLY LOW
The 87 farm sales in July was the lowest level for that month since 2012 and more than -8% lower than the same month a year ago. A big drop in the sales of finishing farms was offset by a similar rise in grazing properties, maybe MPB affected. But the net reduction in the end turned out to be a halving of sales of horticulture properties. This page will give you price detail.

REGIONAL VARIATIONS
Sales of lifestyle block properties in July were similar to the levels we saw in the same month a year ago. But there was rising demand in Waikato and the Bay of Plenty, and steep falls in Taranaki, the Manawatu, and Wellington.

RESURGENT
In Australia, there was a good rise in the value of construction work completed in the June quarter, overall up +9% and pushed higher by a return of some large engineering (mining) projects. But residential and commercial property projects also came in with reasonable rises as well.

SWAP RATES LOWER
Wholesale swap rates are down -1 bp across the rate curve again. The UST 10yr was up on general stock market -risk-on mood, but then fell sharply as the Manafort verdict and Cohen guilty pleas came in. Political uncertainty. It is lower at 2.82%, down -1 bp and has stayed down. The US 2-10 curve has now fallen under +23 bps, a new 11 year low. The Aussie Govt 10yr is at 2.54% (up +1 bp), the China Govt 10yr is at 3.66% (down -1 bp), while the NZ Govt 10 yr is now at 2.61%, up +5 bps. The 90 day bank bill rate is up +1 bp at 1.91%.

BITCOIN JUMPS
The bitcoin price jumped on the Manafort/Cohen news now up at US$6,719, up +6.5% from this time yesterday.

NZD FIRMER
The NZD is a firmer against the USD at 67.1 USc today, a combination of a weaker greenback and the surprise retail sales data. On the cross rates we are marginally softer at 91.2 AUc and 57.9 euro cents. That puts the TWI-5 at 70.7.

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22 Comments

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The number of available properties for sale in New Zealand has risen steadily throughout the day to stand at 30,434. This time yesterday that number was 30,393.

Addendum, a few more in the last few minutes including a couple of lovely offerings in Remuera. 30,441 listings.

If it keeps up at this rate, everything will be for sale by the end of the year.

2013 Census had 2,985 dwellings in Kohimarama. With 19 listings on Trademe it will be a long time until everything there is for sale.

30,445 now, which is actually more because 41-48/178 Mcleod Road, Te Atuatu, South Auckland whilst it is one advert is actually 8 units advertised as 'Mortgagee Sale, Massive opportunity'

with about 1.8million dwellings that is about 1 in 60 currently for sale.
and with just 5600 sold in NZ in July (REINZ data) that means on the order of 6months to sell on average.

Thanks Foyle and yes.. The average time on market statistics provided by REINZ et al are not being accurately recorded or reported because they fail to take into account, re-listings, changes in agent, price changes get re-recorded as New Lisitngs, change in status from by tender, by neg, price affixed.. The reality is that there is already over 6 months inventory in the market and the numbers appear to be rising..

Some will sell, many will fail, lets see what the numbers do over the next few months.. My guess is that the inventory of unsold/available stock will balloon and unlike other markets Vendors here are paying for the privilege of marketing (usually for three months minimum) - Just wait for the unsold stock from last year to re-hit the market.... they've already had one sour experience, if they want to sell they will be listing more aggressively this year with prices attached probably as the differentiator. The days of 'by negotiation' are coming to a close...

30,450 ...... Sounds best in the voice they use at the darts!

Is that excluding all carparks and houses for removal?

It’s basically Trademe.co.nz -> Property -> click search. It’ll include plenty of owner occupiers looking to upsize/downsize which is just normal everyday stuff.

Exactly why i was asking,, if its stuffed full of relocatable houses, carparks, and other oddball crap the number isn't relevant. If it was houses, townhouse and units only at least its something vaguely indicative.

Just consider a great lead indicator.....

Nzdan... I'm skipping the country for a little while, is there any chance you could continue the Trademe daily increase in listings clock in my absence?

Because.... there's no internet overseas?

nah,, because I can't be bothered to look while I'm away....

It's just Trademe for sale listings... now at 30454....

http://photobucket.com/gallery/user/Kregener/media/cGF0aDpNb25leS9SYXRzL...

https://www.youtube.com/watch?v=7hx4gdlfamo

The door to the gamblers den has been wedged open....

I wouldn't get too excited, on Aug 22 2017 trademe had 29047 listings for NZ.

a 4.8% per annum increase in nationwide stock year on year

Unsold stock. mja.... that's a massive rise then in available/ unsold stock for the quiet season.... let's see how the numbers rise over the next few months, have you recorded August through to December 2017 so we can see how desperate it gets?????... because that's already a very big increase in patient sellers waiting for a buyer since the last mid winter low....and now the foreigners are being stripped from the market with their wads of easy cash.........

Latest TPP a parade of corporate favours masquerading as free trade
https://www.michaelwest.com.au/latest-tpp-a-parade-of-corporate-favours-...