A review of things you need to know before you go home on Friday; key rate changes, lower migration, another KiwiBuild ballot, more health spending, lower visitor growth, RCEP meeting here, swaps fall & flatten, NZD firmer

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

MORTGAGE RATE CHANGES
SBS Bank has launched a 3.95% two year fixed rate. Meanwhile, TSB has added +10 bps to their 18 month and two year fixed rates taking both up to 4.29%.

TERM DEPOSIT RATE CHANGES
BNZ have raised their one year term deposit rate by +5 bps to 3.45%. Even though this is an unusual rise, this new rate matches some of their main rivals.

FURTHER FALLS IN NET MIGRATION
The net gain from migration is slowing fast. But the rate of fall is slowing. The September's net migration gain is down more than -20% from the September 2016 peak, and the September level of +6,263 was the lowest September gain since 2014. That means that we welcomed 62,700 new migrants in the year to September 2018. It peaked at 72,400 in July 2017 after tighter new rules were applied

A KIWIBUILD BALLOT
The ballot will open on Monday for 18 KiwiBuild apartments in the Tuatahi project which Okham Residential is completing adjacent to Pak N Save on New North Rd in Mt Albert, a suburb of Auckland. Tuatahi will eventually comprise three mid-rise apartment buildings, one of which is already completed with the second under construction. The 18 KiwiBuild apartments will comprise nine studios sized from 40-49 sqm and priced from $435,000 to $480,000, six one bedroom apartments priced from $480,000 to $500,000 and three two bedroom apartments priced at $600,000. Car parks will cost an additional $50,000 each.

MORE HEALTH SPENDING
The Government has allocated another $224 mln for two North Island hospital projects. The North Shore (Auckland) hospital will get 120 additional elective surgery beds and four new operating theatres at a cost of $200 mln. This hospital is part of Waitemata Health DHB, the largest DHB in the country. A new endoscopy and cardiac care facilities for Whangarei Hospital is also being funded (Northland DHB) costing $24 mln.

FALLING AWAY
Infometrics has been reviewing today's tourist visitor data and report: "Tourist arrivals in September were up 2.1% from a year earlier. However, when compared to August, visitor numbers fell by 1.9% (seasonally adjusted). September was a relatively slow month, with the growth in Australian tourists stuttering and the number of Chinese visitors climbing moderately."

CARD HAPPY
The level of domestic transactions being run through credit cards in New Zealand increased +7.8% in September compared with the same month a year ago. That is the fastest growth since October 2015.

SMALLER BUT PROFITABLE
Youi's New Zealand accounts were posted to the Companies Office website late yesterday revealing a -14% drop in premium income and a -26% fall in payroll. That reduction enabled them to report a $10 mln profit for the year to June 2018.

ANOTHER TRADE DEAL INCHES FORWARD
The Government is pushing ahead with its membership in the China-led Regional Comprehensive Economic Partnership (RCEP) and will be hosting a meeting of ministers from 16 countries in Auckland over the next week. The RCEP is like a TPPA, but without the labour and environmental protections. The RCEP would embed our economy in a regional agreement with half the world’s population and markets that take more than half our total exports. (The close relationships China's loca proxies have with our politicians seems to be paying off for them.)

SLOWING, BUT NOT AT HOME
China’s economy grew at a slower-than-expected +6.5% in the third quarter, the weakest rate since the global financial crisis. Retail sales however rose faster than expected, up +9.2%.

SWAP RATES FALL
Swap rates have fallen and flattened today. For 2 years they are down -1 bp, for five years they are down -2 bps, and for ten years they are down -4 bps. The UST 10yr yield down -3 bps from this time yesterday to 3.18% but up slightly from this morning. The UST 2-10 curve is now just under +30 bps. The Aussie Govt 10yr is at 2.69% (down a sharp -5 bps), the China Govt 10yr is at 3.59% (down -2 bps), while the NZ Govt 10 yr is at 2.68%, and down -4 bps. The 90 day bank bill rate is unchanged at 1.90%.

BITCOIN SLIPS
The bitcoin price is now at US$6,439 a fall of -1.2% in the past 24 hours.

NZD FIRMER
The NZD is firmer and now at 65.6 USc. On the cross rates we also firmer at 92.3 AUc, and 57.2 euro cents. That puts the TWI-5 up to 69.9.

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19 Comments

The RCEP is like a TPPA, but without the labour and environmental protections

Isn't the only job of Greens in the Parliament to stop such things from happening? Winston Peters opposed every trade deal while in opposition during Key's PM-ship saying we shouldn't sign anything without letting ourselves and the public know what's in it for us. Whatever happened to that?

You what????
KiwiBuild studio units 40 to 49 m2??
How on earth are Studio box’s without carparks designed for families to get into the housing market!
KiwiFlop at it s best!!!
Twyford is totally having you all on about these affordable first homes for young Kiwi families!!
!!!

Nothing wrong with a studio apartment for a young couple. Family doesn't necessarily mean 3 screaming kids.

And who said kiwibuild was just for "families", there are singles that need a place to live too.

Take it easy honey bun. The long weekend is upon us. Enjoy it

I think we should remove NZ from the global map. Then no one will know where we are or how to get here. That'll sort out the immigration issues. Probably most of Auckland Airport's issues as well.
A China TTP ay. Without environmental or labour guidelines. Mmm! This is right up the CoL's avenue. They might have to invite Jamie Lee Ross along. He's a real deal maker.

Hard to change the map but we could just become a province of China; they don't seem to have an immigration problem.

Mt Albert - a studio with a carpark up to $530,000 and a one bedroom with a carpark up to $550,000!

And immigration numbers still running at patently ridiculous levels.

At least we can’t shoot ourselves in the foot anymore – there’s nothing left.

Minor correction.. no carpark with the Kiwibuild studio apartments, not even an option to buy one, so only up to $480k & get on ya bike Mike!

Well that’s splendid news – after shelling out just shy of half a million dollars for my studio I’m thankfully not burdened with the option of a $50,000 carpark.

And should I have a vehicle parked on the street that may be stolen or vandalised I can just throw back my head and laugh while happily acknowledging it’s simply just another a good problem to have.

Auckland hasn't got room for everyone to have a 200 m2 house with garden.

Some people just struggle to get that fact

Wasn't there a time when the house was small say 80sm to 100sm and they all had a garden and Auckland had plenty of parks and reserves.

Geez if Aucklanders are happy to live in studio units and living without a car, then your standards are pretty low.
Seriously you are being had on badly if that is what you aspire to.
Professional couples will never have kids and will not stay together, as living in 40 m2 would not be much fun.

You sound like JLR

We find it challenging with 85m2 on 1/4 acre for 2 adults and an 18 month old. People who haven’t had kids don’t realise how much space all their crap takes up, especially when it’s been catapulted across the house.

There has been a frenzy of purchasing from those trying to avoid the repeal of the 'one house guarantee of one vote for National' policy.
National unsold stock has fallen for the first time in weeks from 35,596 yesterday (Real estate.co.nz) to 35,585. A fall of 11 houses that may have been sold or may have given up?
Auckland unsold stock has also fallen from 13,412 yesterday (Real estate.co.nz) to 13,399. A fall of 13 properties.
In contrast, Auckland rental offerings (trademe) have risen since yesterday from 4097 to 4137 - a rise of 40 units putting a touch more pressure on rental prices that have recently been falling.

No members of the police were harmed nor were any members of the public, but allegedly, 27 policeman and their mates all had to put down their doughnuts and chase one car? Is there a way that we could direct that rapid response to immigration fraud/exploitation? Exploitative prostitution? Landlords that fail to comply with regulations? There do seem to be a lot of them (24 or 25 of the 27) desperately looking for something worthwhile to do with their day! I've got a load of ideas to keep them busy......

https://www.newshub.co.nz/home/new-zealand/2018/10/fleeing-driver-causin...

Look at it this way, that police chase temporarily took 27 speed cameras off the road.

The cost of those KiwiBuild apartments is quite high although they look quite nice. It looks as though the complex has a swimming pool too. As an investment it needs to be a place that aspirational people are attracted to. As an investment you would want to make sure that they don't become HNZ abodes. A few bad apples in the place would be devastating.

http://www.ockham.co.nz/tuatahi/

I can't help thinking that KiwiBuild will underpin current prices. As a property owner I don't feel threatened by these places coming onto the market.

My advice would be to seek out your own place in West Auckland or similar. In the auction results I see this place sold for 686k. You get your own garage for that price. Way nicer than my first home was out in West Auckland:

https://www.barfoot.co.nz/763611