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No sign of downturn in house prices or sales volumes as buyers thumb their noses at coronavirus threat

Property
No sign of downturn in house prices or sales volumes as buyers thumb their noses at coronavirus threat

Home buyers appeared unconcerned about the threat of coronavirus and the turmoil in world financial markets at this week's early auctions.

At Barfoot & Thompson's regularly scheduled auctions at Manukau and at the real estate agency's head office auction rooms on Shortland Street in the CBD on Tuesday (March 17), bidding for properties remained competitive and the overall results were still in line with those of the previous few weeks.

At the Manukau auction, 42 properties from south and east Auckland were offered and sales were achieved on 22, giving a sales rate of 52%.

At the Shortland St auction, 10 properties from central and western suburbs were offered and seven were sold, giving a 70% sales rate.

That gave an overall sales rate of 56%, consistent with Barfoot's narrow weekly sales rate range of 55% to 58% since the last week of February.

It was particularly significant that at the Shortland St auction the first three properties offered had all received pre-auction offers that were acceptable to their vendors and had been accepted subject to a better offer being received at auction.

Effectively this meant the pre-auction offers became the reserve prices and in such situations it is not uncommon for there to be no bids at auction because the pre-auction offers are at or near the top end of the properties' expected price ranges.

But all three properties received multiple bids, which meant they sold for prices that were almost certainly well above their vendors' price expectations.

So looking at both of Tuesday's auctions and comparing them to those of the last few weeks, there is nothing to suggest that either the number of sales or the prices being achieved have taken a sudden turn for the worse.

The fallout from coronavirus will have two main impacts on the housing market, one of which is almost immediate and quantifiable, while the other is longer term and not yet quantifiable.

The immediate impact comes from the Reserve Bank's decision to slash the Official Cash Rate, which resulted in an almost immediate drop in floating mortgage interest rates, with cuts to the more commonly used fixed mortgage rates likely to follow over the next few weeks and months.

In the normal course of events that would be expected to either push up or at least support current house prices.

The other impact from coronavirus is that the economy appears increasingly likely to be pushed into recession. If that happens unemployment is likely to rise while wages and consumer spending are likely to be suppressed and immigration levels are likely to fall.

All of those things would likely have a negative impact on the housing market, in terms of rents, prices and turnover. The trouble is, it is difficult to say when those effects could start to bite, how deeply they will bite and how long they will last.

That's where the uncertainty comes in.

It appears that at the moment, house buyers are focussed more on the known, immediate effects of interest rate cuts rather than the potential long term impacts of recession.

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122 Comments

Wash your hands, hold your breath...go ahead business as usual the property Church gospel earlier this week. Already tone it down, sidelines this little disruption as something just will pass after 12 months. So, yip folks - hit that auction button, do it online, buy now option if possible. Literally nothing, no Force can stop NZ RE productivity industry. You shall be rewarded in a short-medium-long term, C'mon jump with the flow now !

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Bit over the top mate, it could be a good time to buy, but you still want keep a calm head.
Are you selling your investments or are you investing or sitting doing nothing?

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I think (hope) he's just being sarcastic.

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As dastardly as it is, Covid-19 will most likely prove a 1-2 year event.

Most property owners/investors operate on far longer timeframes than 1-2 years......

Thus, the vast majority of them will simply ride it out - thankful that their assets are tangible [land, bricks, mortar] and not shares etc.

Call them privileged if you wish - but many/most property owners have worked damned hard for the security they've earned.

In the medium/longer term, the prospects for property remain excellent.

TTP

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I'm finding this whole houses tangible/shares intangible a little off the mark in terms of comparing exactly what it is you own in each case. Surely the actual equivalent to owning a share is owning the title deed of a house, and the equivalent to owning a house is (part) owning a company which especially for masonry companies often do have bricks and mortar.

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Agree. "Bricks and mortar" as a concept of value is laughable. By that measure many large profit earning businesses (banks, facebook, Google, lawyers etc) are low in value and the owner of, say, rural ex-soviet large factories and apartment complexes in Bulgaria is extremely well-off despite earning diddly-squat on his bricks and mortar investments.

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Well blow me down. The party continues.

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Yep. I don't really understand it.

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Hows the portfolio JC

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You mean my bank stock portfolio? Pleased to inform you that I don't have one.

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Gotta get me a house to self isolate [sarc]

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As previously posted - Barfoot's auction results are the early indicator of what impact the virus will have on the property market.
Still too early to call. Clearly some negative factors such as job security and some positives such as lower interest rates and net emigration of NZders likely to be down and more returning. Barfoot's auction results over the next few weeks are important information - so thanks interest.co.
And before we get the rush of postings as to how the RBNZ OCR cut was simply to protect housing - it was for economic stability purposes and their rationale mentioned was to encourage investment by businesses. So yes, while home owners may have benefited, so too has your job security especially if your employer relies on an overdraft.

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Do you have a singular point to make here?

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Disappointed and upset JC?
No sign yet of the crash you have long called.

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So your point is "there's no property crash." Got it.

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JC
No - you clearly are unable to comprehend either the current auction data or my comment.

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Government and RBNZ can only do so much. RBNZ also just released information that they've ruled out negative OCR. This means there will just be very little margin to play with. For banks, they only matched floating rate with current OCR. It is unlikely they will make a big move on fix interest rate as the are still risks and costs involved. Thinking government will protect housing? Not with more cash injection needed in health sectors during this virus crisis. You'd better hope this virus crisis wont last long cause if it does, every industry or market will be effected. Lets just hope there won't be a crash.

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Long term, a massive crash in the NZ property market could well be the best thing that could happen.

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I think a small/no crash coupled to a long slow recovery with average growth below GNP would be the best outcome

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Happening in stock market now............wait ..................

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I have access to a large business overdraft (currently unused), this may surprise you, but the bank hasnt been bashing down my door to lower the interest rate (9.2%), something to do with perceived risk maybe ? Banks will not be helping SME's would be my prediction, unless the perceived risk around property becomes greater than the perceived risk around business.

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Biggest fall in the stock market since 1987 market crash.

https://www.theguardian.com/business/live/2020/mar/12/stock-markets-tum…

Even if idiots in NZ keep buying houses and pumping up the prices in NZ the crash of the financial markets will mean that that the NZ property market is crashing.

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You can have all those fancy houses but none will have enough loo papers..

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No but we are having a luau party with Hawaiian girls on the weekend. BYOTP

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Social distancing of at least 1.5m.. That'll be fun with the Hawaiians

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Event has to be cancelled. We have been advised by MoH that Hawaii not part of pacific islands so the girls will have to self isolate or be deported. Damn they were going to bring in some extra tp

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Eat more fibre (e.g. psyllium husk) and no loo paper required.

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Just poke the garden hose in the loo window, with a trigger nozzle on the end and jobs done. Just need a towel to "tidy up".

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The world as we know it is ending and the property party continues.

Are they incredibly brave or incredibly stupid?

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They are just stupid with steel balls

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It's going to take months for the property market to play out (for good or bad).

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Is this a joke because a couple of days ago it was only a matter of weeks for the collapse

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I would guess that they're still of the mind that it's all a storm in a teacup and there won't be a big recession, redundancies etc.

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Hi Brock Landers, same thing was happening to stock market last month when it was touching all time high and many were asking the same question, how could it rise with everything happening around the world but it happen. Today market has crashed with no sign of recovery in very near future so have to waait for the first few bricks to fall from housing market before....................

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I’m sure the clearance rates will only increase as vendors fight to sell at the lowest possible prices.

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29 sales, all is well , keep following the same path....., wait ,where did all the other lemmings go

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Something to ponder ...

Imagine there is listed company which has 1.5mn shares issued. And in one week, 29 shares traded and that determined the market value of the entire company ...

FYI, Auckland has about 1.5mn residential dwellings.

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I seriously doubt that Auckland has 1.5 million dwellings, I don't have the numbers but since the population of Auckland is 1.5 million and there are roughly 3 people per dwelling…

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Just back from Asia, and you forget how few people are here. 1.5m it's just a village.

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You are correct. Its about 500,000. I was thinking of population. Apologies for error.

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What will be interesting will be to see how new listings and days-to-sell are going. Still looks like a sellers market here in Welly but days to sell for 1M+ seem to have have slowed up. Entry level priced houses still snapped up within a week/fortnight.

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Safe place to put your wealth in troubled times

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Some people are missing an obvious point.... there are plenty of people who are cashed up from having sold their house (often a year or more ago) and are renting. They are tired of looking and they don't care if they pay more than what the house may be worth in six months' time because they are also uncertain about how secure the banking system (where they have parked their million +) will be in six months. So they want to get it lodged in what they see as a more secure asset (even while accepting that asset might drop in value).
I know three couples in that situation who have all committed to buying houses in the past week without any particular discount on account of covid-19.

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GA - Well said, very very uncertain times ahead and having all your money in a bank over the next 6 months is not secure.
If we can contain this Virus and I feel we can/will then I see the desirability as NZ being a Stable and Safe place to be as only positive in the future for NZ property.
There probably will be a dip but the resilience of the residential property market will be on display again.
Commercial property will be in a down draft with business failures and the general lack of consumers out shopping

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little chance of containment -- and to do so will be closing our borders and keeping 8 bill of tourism out - not to mention the restrictions on exports -

a Vaccine will be 12-18 months away at best -- and if we did somehow keep it out -- we wont be able to reopen the borders until the vaccine is available in mass quantities and proven to work

Commercial property about to become very cheap - and unwanted -- residential - just cheap and unaffordable -- still wanted but only large investors able to buy -- and most of them will have been burned hard in the markets first

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shoreman it will be contained but WHEN is the question mark as every day / week/month it is taking the economy back and if it continues the way it is for next few months than what is happening now will be just a trailer of the horror movie.

One has to be optimisit but Cautious in this uncertain time when no one know what is happening and how it will unfold. Not the normal buy the dip scenarion. This is unchartered territory not witnessed before.

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Sure, there may be plenty of cash buyers but statistics show us they make up a small proportion of the total buyer pool. FHB's and investors take up the lions share and both typically (but not always) leverage the sh*t out of each transaction with LVR's often above 80%.

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A logical call if you have cash. Gearing up to buy assets in this environment is where the big risk lies.

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Those couples are lucky they didnt have a go in the sharemarket. Many companies, decent ones have lost a third of their capitalisation in the last week to add to the previous collapse in value!! Will not recover.

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After the GFC it look 2 years for house prices to stabilise at a much lower level. All this talk of covid19 , stockmarkets dropping and the unprecidented amount of debt being pumped into the world economy having not affected our housing market is really quite ridiculous. Reminds me of a male peacock with his feathers splayed strutting around squarking “look at me, look at me!”

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Unless there is lots of actual sustained job losses and banks get hit hard with a few going tits up, or via statutory changes to their reckless behavior why would prices change drastically. Agree with other comments will take several years for this to wash thru. Currently via the Orange one, Repo printing and spaying money allover the show to protect the finance industry, yet destroy the wealth of savers, seem the order of the day.

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30% to 50% was the collective price drop forecast here last weekend remember, "eye-watering falls"if I recall.

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I week ...let's come back in a month and check?

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Yep and in month, you'll say "well let's see in 6 months" Then in a year etc...
Maybe you're too new to remember the commenter called "Houses overpriced" he joined in 2010 I think and kept calling for house prices to crash soon, he was wrong for 8 solid years then he disappeared

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No one said it's gonna drop 30 to 50 percent in a week. Most intelligent people are aware that the crisis has just started, it's far from being over. House prices are gonna lag behind by 3-6 months at least.

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This is a short sharp shock that will most likely have dissipated within 6 months. What we will be left with is extreme growth settings in fiscal and monetary policy - I see it 50/50 that house prices are higher by the end of the year.

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"short sharp shock that will most likely have dissipated within 6 months" - You wish.
Extreme growth based on what? The trillions dumped into the US stock market disappeared in minutes. Many people won't have jobs for months. Production is still just starting to shut down in major economies (Europe, US), while it hasn't even recovered in China, 6 months after the first Covid-19 case.
You are extremely optimistic about this crisis.

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"optimism is the faith that leads to achievement, nothing can be done without hope and confidence" Helen Keller.

Let's revisit in 6 Months CJ, in the meantime we all need to pull together. Also i'm 50/50 remember

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Well, "50/50" and "most likely" aren't quite the same...

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and pray tell, where did I say house prices were most likely to rise?

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I disagree. I think there is next to no chance prices will be higher by year's end.
This shock might be 'short and sharp', if we are lucky, but the impacts are going to last quite a while.
The short, sharp shock is going to destroy quite a few jobs. Many will be in retail, hospo, travel and tourism, and these job losses may have limited effect on house prices.
However, the impact is spreading. As I wrote elsewhere, the development sector is starting to pull back, and there will be job losses in consultancy, contracting and construction.
Some people will be forced to sell, and many others will be cautious of buying with this uncertainty.
I've called a 3-5% decline in major centres, but I think that's being optimistic.

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6 figure consultants out of a job, i imagine many could have mortgages that loosely reflect their income.

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Something to think about when considering the future of the property market is that the last two years of data suggests people have been holding onto their property, possibly waiting for signs as to what direction the market will head. Those that have postponed, with recent developments, may now feel greater anxiety to sell sooner rather than later. I reckon we’ll see an increase in listings over coming weeks followed by a slide in prices.

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It would be good to get some insights posted here as to numbers on the ground attending open homes and auction rooms. Are any agencies conducting auctions available to watch online?

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Our local Ray White office occasionally broadcasts auctions but the camera is held firmly on the auctioneer not the attendees.

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These people have no clues what is coming and will soon start moaning poor me why has my house price crashed just like people who are moaning about kiwsaver going down???.
The house market will prob take a month to see changes and then it will become purchasers who rule as long as you have cash and will just drive prices down.
Thats how the market works simple.

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Auction buyers are pre-approved or have COH

The situation globally is escalating so fast that a month from now wil;l look drastically different than it does now.

Expect Banks to only pre-approve those with "safe" jobs, Banks are definitely going to tighten.

On top of that if and when we see community spread in NZ - everything will go next level!

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House buyers remain ignorant.

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… and wealthy

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Wealthy ... for how long?

Just because people have wealth now, it doesn't mean that they will remain wealthy. There are people out there who have a large net worth, who own large amounts of assets which have been financed with high levels of leverage.

Some highly leveraged property owners are potentially at risk. Some highly leveraged property owners have never experienced a recession, and have chosen to not learn the lessons of history which have been learnt by previous generations of highly leveraged property investors.

There was at least one property mentor who was highly leveraged who went bankrupt in the last cycle.

History is littered with numerous other examples.

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Wealthy for the last 30 years at least, that's for sure as for the future, nobody knows

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We're talking about the house buyers in Auckland who are buying in these auctions at current prices - the 29 buyers who bought.

These people have deposits (either saved, or by leveraging on their current equity from other assets or some other source), and they are likely to borrow the remainder.

What will this equity be worth in say 3-5 years time? Given the probabilities based on the current environment will their equity be more? or less?

Just out of interest, what was your personal experience in the 2008 / 2009 GFC?

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no mention of prices to CV here -

Last count 27000 air B and Bs -- how many will go onthe market and how many will go back to rentals ? 30000 empty homes in Auckland -- how many will need to be sold or rented as peoppe lose their jobs, businesses or at best have their hours cut substantially ?

No immigration -- borders closed so no increased demand on that front -- and less buyers as people lose their jobs, second incomes and extra hours -- again less buyers -not including all those thinking - maybe for once this is not a good time to buy - even a first home!

I think finally the correction has arrived -- be a bloodbath in three months unless they can control it -- and all the signs for that are BAD - REALLY BAD

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It's a perfect storm is brewing out at sea but for some (investors) they still think it's a sunny day at the beach.

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Some property investors(?) are so high on this latest OCR cut that they haven't noticed that the party's over.
The reserve banks are acting like a drunkard in the casino at 3am, desperately trying to win some of his money back with the last few dollars he was supposed to keep for the taxi ride home...

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Not just property investors..... central city suburbs like Ponsonby Herne Bay are selling well over cv with bidders expecting 10% price increases in the next year so are over bidding.

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'No immigration -- borders closed so no increased demand on that front' ........ not so sure. 750K NZrs live overseas. If this recessions bites really hard many will come back so they can access the benefits of a system paid for by those of us who didn't turn their backs on the country. They'll be balanced to some extent by work visa people having to leave but some of these returning kiwis will be looking to buy. How many will just sit on their Aussie RE and wait the recession out vs selling up over there is impossible to tell.

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Do you have a link for those air bnb numbers?

Thats alot....

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Does the new commercial building depreciation mean that if you are a book a batch operator whose property attracts commercial rates you now get to depreciate the building? Would this not lead to more residential property being converted for commercial short term accomodation use? It may even increase demand for investment property that can be classed as commercial!

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Hi, so called DGM there. Guess what, some stocks are becoming cheap all of a sudden. Who would’ve thunk it? I’m liking some US financials already, but don’t touch Aust/NZ banks, they have 3 times or more debt to equity! Some of the classic quality companies are becoming less expensive (some down 40%), but I think more to come! Forget NZ and Aust property for now, I think a reckoning is on the way. There will be a tme though!

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A few points to mention before everyone gets too excited about the invincible housing market.

1.The housing market is sticky and lags so this is not to be unexpected - the "r" word was only first mentioned over the last few days.

2. Unlike shares you cannot reduce risk by selling part of your portfolio immediately i.e.you cannot sell one brick at a time and the value of the whole market is then set by the price of the last brick sold!

3. You cannot sell a house overnight to meet margin calls/raise collatoral.

4. Decisions to sell or buy now will likely take at the very least six weeks to filter through to the market.

I think we need at least 6 months to pass before there is any clarity around what is the likely scale of this event economically and whether the Kiwi HM is immune to absolutely every world event, as some here believe.

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Correct Tom Joad, one should wait and watch as what is happening now is just a trailer and full movie has to follow.....most probably if it continues will be a horror movie.

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I would expect a hump as people look to diversify and preserve cash. Two months on there will be more houses and less buyers, due to liquidity problems or job loses, less immigration etc.
So downward pressure on housing for the first time in a while. The government will defend the debtors (read banks) tooth an nail, whether they can remains to be seen. So buyers now can expect a loss but will keep an asset which is preferable to losing all in a "haircut" or devaluation.
Time for the Government to start considering deposit protection schemes.

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World market/economy is crippled and everything is falling apart and to expect that housing market not only in NZ but world over will be immune........

It is the same situation as last month when everything was falling but still Stock Market was making New high.

May be Housing market will be next month or two where stock market is today (definitely and hopefully not as bad as stock)

Wait and Watch.

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The economic impact of the virus on property will be interesting. Buyers becoming cautious due to job security worries and sellers not listing because who wants a bunch of potential sickos sneezing through your stuff at ppen homes or showings? People still need to live somewhere so they need to either buy or rent. Property ownership always survives in the long run.

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"Property ownership always survives in the long run"

That is a commonly held belief, perpetuated by those with a vested financial interest.

How long is adequate before the owner should experience a return of their capital? Is more than 12 years sufficient?
1) Bought February 2000: $209,000
2) Sold July 2012: $180,000

After 12 years of ownership, the owner made a loss of 14% on the house price (and this is before the impact of leverage). Remember they also paid interest costs for this privilege. They might have have been better off financially by putting their initial deposit in the bank and renting.

https://homes.co.nz/address/auckland/grafton/25-3-burton-street/20aJ

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Older family members of mine agree with you. Having been through 87 and many other ups and downs and now virtually no return on term deposits they just stuck with the property. Paid off since a while back, returning a bit of rent they are glad they didn't take conventional wisdom and sell up when approaching retirement. The only caveat to that luck is 40 years of a rising demographic tide and house purchase prices at multiples cheaper than now.

But yes if well located, in demand with multiple employment options around property can be good.

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Many on this forum agree that house prices have risen as a consequence of cheap and plentiful credit (loose monetary policies). Well the OCR has been reduced by 0.75% and the RBNZ has just announced it will postpone by at least 1 year new bank lending restrictions, which quote "is expected to give the banks capacity to lend additional $47 billion"

https://www.interest.co.nz/banking/104122/rbnz-defers-regulatory-initia…

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Also this is just phase 1. Phase 2 is a massive QE programme. Money is going to be even more plentiful than ever more, whereas building will presumably start to slow down as materials stop coming in. Hard assets are where its at.

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One hopes that older, supposedly right-leaning folk will be self-aware enough not to lay into "socialists" and "beneficiaries", in this light.

To do so would be rather unbecoming and show a complete lack of self-awareness.

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Genuine question, how low do you see interest rates going beyond 0 to keep asset prices rising in the medium to long term? Given the 12 years since the last recession, we've seen plentiful credit in the "recovery" phase, how much more can be provided during the next "recovery"?

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There will come a point where lowering rates further won't work, especially negative. We may be nearing that point. No doubt they'll take a lot of other measures to try and resuscitate.

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And just now ANZ have cut a BIG 0.4% off their one years fixed rate to an ALL TIME LOW OF 3.10%, you'd think that 2.99% isn't far away with a bit more competition from other banks

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see what happening in the UK through all this stuff - that'll be your gage , they've been down there for nearly 10 years

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Hi Snow, good question, it's very hard to answer, my gut feeling is that Orr doesn't want to go negative, then again he also said he wouldn't make an OCR announcement before the scheduled review on the 25th… the long term interest rate trend is certainly very clear and it's down. I won't make a call on how low it will go, this time I just don't have a clear enough idea

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Do you think I'm guessing? when I have stated on this forum that he'll reduce it by 75 basis points, whereas no one else I recall stating what I've stated. Now, mark this the next one on May will be 25 points down further, unless the OCR team a bit embarrass that I steal their thunder? - then they shall opt. the unconventional number.. 15 basis points down, just to make it look pretty that we are still in two digits territory.

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I called the 75 bp cut.
I don't think he'll cut further.

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'Many on this forum agree that house prices have risen as a consequence of cheap and plentiful credit (loose monetary policies).'

Yep. But that's assuming reasonably robust economic conditions and the maintenance of low unemployment. Those assumptions are flying out the window.

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Oh look, the Australia sharemarket has just been wound back a decade, but we'll be fine here...

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Voice of reason? Looks like 2 years to me.

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As I recall house prices and interest rates did not bottom until 1992 post the 1987 share market and commercial property bubble. Post the 2008 GFC the property market didnt bottom until about 2011 despite all the stimulus. There will be some earl margin calls for the over leveraged but otherwise patience is required.

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For stories about commercial property after the 1987 stock market crash, ask Big_Daddy (aka Olly Newland).

Read his book "Lost Property".

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Harcourts Holmwood CHCH auctions today, 10 properties, 2 sold, 2 neg. 6 passed in.

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Christchurch is a great place to be buying right at Auction if you know what you are doing!

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Why?
are houses selling for less?

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No comment!

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Wow, you would have to be delusional to believe there will be no effect on the property market from covid-19.

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Basically we are 1second into a 100M race but the problem is many on here think its already finished because they can see the finish line. This has not even got started yet. 20 cases now so 200 on 1st April and thats no joke.

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3 years of US stockmarket gains have been wiped out in 3 weeks.

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Here are the clue why I'm advising to buy now: Orr's & team are all property owner, PM to all cabinets also property owner, all Banks loan more than 60% to properties, the current Covid19 relief fund is to bail out for property owner that losses job to help them with servicing the loan, Banks CAR has been delayed from 5 to 7 years, Insurance review delayed another 6 months, More than 50% of NZer have been swayed into this wealth creations by means of RE. NZ Banks soon will follow UK moves to provide 'period of mortgage holiday' during uncertain period of times. No matter how you turned this upside down, inside out, throw out any common sense of Economical theory/practice/historical based facts etc. for this little country - That won't matter as one thing for sure - Future/overall tax payers bail out will be sure on the card every time, hell even for probability of Banks failure, we already have OBR tool in the pocket, QE always manifested in tax payers bail out - The only natural variable here is 'TIME' - for how long it can be sustained? even this has been mitigated by the band of followers, by putting most of public voters and young generations into firm believe that.. RE is the future security of wealth creation thus happiness. Honestly, even your health is guaranteed by RE wealth. Worry about expensive cancer drugs medication? guess what? even the RE champs that free up from CGT contribution will enjoy the same of tax payers subsidy in the end for those drugs, the same as poor Joe Blog that lives on the street all life time. Do Not Fear at all... RE production wealth industry is your key to live here in NZ.

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Rinse and repeat:

Huge hit to employment and trade volume and export earnings coming.
Import prices will rise due to shortages.
Means, more inflation, less income coming in.
Add to mix, hugely leveraged debt and credit system which growth is required to service.
Equals liquidity implosion, rising high yield spreads, defaults, bank failure
This has been coming for 15 years and should have happened in 2008-11
it didn't because of extend and pretend.
That trick won't work now
The recent surge in house sales and mild price rises in Auckland is over and virus and credit event (financial crisis Citibank Chair was calling a "not) will crush housing market from June this year for at least a year.

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Yep a 2 or 3 month lag before it hits the fan. Job losses then spare funds run out and then the asset firesales begin. Watch for cars first on the chopping block. Of course if the housing market survives this then it is truly indistructabl.

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RE NZ listings had stalled (inventory) but have now started rising.
This is because they are to selling as fast, so turnover drops and total remaining OTM rises.
Crux is what happens to NEW listings per day over next week.
Be v predictable if it falls.
Should be about 7-8 a day at present part of annual cycle.
4 would be my initial estimate of where its headed.

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Who would buy an illiquid asset at the start of global panic? Who would want to buy in a city now that might be locked down tomorrow, and your job or business is gone or losing money? Sorry to sound so downbeat, but 2 weeks ago property may have been a good investment - but wow has that World changed. I truely hope all FHBs wait this out.

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3 weeks before stock market was also a good investment and was moving up uP UP....Today......

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Well purchased property is going to more than hold its value.
More and more people are now going to realise that property is a helluva lot safer than investing in the so-called productive segment, equities.
The sharemarket is sheer gambling, and nothing wrong with gambling if you have some sort of control over it!
Reality is that with shares you have absolutely no control whatsoever as other owners totally affect the price of your shares.
Why would anyone be selling rental property at the moment when they are returning positive income from them.
The thing is that rents are going to continue to increase in all the cities in NZ and partly due to government intervention.

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Property prices have been more stable and less volatile than shares giving property owners comfort that it is safer.

Minority investors in shares of listed companies are price takers.

There are circumstances where time constrained property owners are also price takers and have limited control over the price at which they sell. What circumstances could that be? Mortgagee sales.

With the increased risk of a recession, some industries bleeding cash and higher unemployment, the risk of a rising number of mortgagee sales have increased significantly from only 5 weeks ago.

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MikeKirk, how are your listings going?.
Have you been selling plenty this year, or are you no longer a sales person?

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What the earthquake in Canterbury taught us there will be winners and losers, I think you can drop interes rates as low as you like but with no Job security (tourism and those fringe businesses), which there will be no quick recovery, you ain't going to borrow to buy a house.Housing market will reflect this in a few months.
Other thing earthquake taught us, is that there is a big difference in what Wellington bleats and the reality on the ground. The government has a very very poor record of operational delivery..Shock (2 weeks) ..denial (3 weeks)...anger (ongoing..)

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Housing market always lags stock market during sharp downturns, people seem to forget banks are businesses too and have their own challenges that are driven by market forces
During sharp stockmarket corrections, banks balance sheets get smashed they start retrenching and actually apply prudent lending standards again and hey presto - credit dries up and housing market stalls

Changes in house prices are basically driven by recent sales (median (middle number) vs. mean (average)) recent sales are primarily driven by the availability of credit

Median sales price is a misleading number anyway that skews house price upwards as middle price does not equal average price

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Apparently all is well in the property market according to this 'Pollyanna principle' article...
(https://en.wikipedia.org/wiki/Pollyanna_principle)

https://www.oneroof.co.nz/news/coronavirus-buyers-and-sellers-still-act…

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how to pay rent or mortgage when you lose your job?

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