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Real estate agencies face an estimated loss of $135m in residential sales commissions as the lock-down brings sales to a halt

Real estate agencies face an estimated loss of $135m in residential sales commissions as the lock-down brings sales to a halt

By Greg Ninness

The real estate industry could lose around $135 million in gross residential sales commissions over the four week lock-down period, and the loss is likely to be even greater if the lock-down is extended. estimates the industry was on track to earn about $135 million in residential sales commissions over the four week lock-down period, based on sales trends up until March 22.

The lock-down, which has brought residential property sales to a virtual standstill, could not have come at worse time for the industry.

The number of homes being sold has been declining on an annual basis since 2016, (see the interactive graph below which plots monthly residential sales since 1992), even though prices have remained firm, which has put the industry's commission revenue stream under pressure.

However sales started picking up again late last year, helped along by significant cuts to mortgage interest rates, and since the beginning of this year sales have been reasonably buoyant.

March is normally a critically important month for the industry because whether market conditions are good or bad, it is usually the industry's busiest month.

Although March sales were looking very promising this year, agencies have had the rug pulled out from under them by the lock-down which has brought sales to a crashing halt, and this is likely to continue throughout April even if the expected four week lock-down is not extended.

However there is some light at the end of the commission tunnel.

According to the Real Estate Institute of New Zealand, the Government's financial support package for people adversely affected by the lock-down is available to self employed persons, which includes real estate agents.

So that could soften the blow for them.

And the usual seasonal trend is for housing sales to peak in March then dip down again in April due to events like school holidays, Easter and Anzac Day.

Sales then typically perk up again May before dropping back again over winter.

It's likely that some buyers and vendors who were unable to complete a transaction during the lock-down will simply come back into the market in May.

So there's potential for quite a strong bounce back in May, helped along by extraordinarily low mortgage interest rates, thanks to the recent efforts of the Reserve Bank.

However looming over everything are the dark clouds of a recession and all of the misery and uncertainty that would bring with it.

If that eventuates, many buyers and sellers that have decided to postpone their plans for a month or two may decide to postpone indefinitely.

In which case the effects of the lock-down could be felt for a lot longer than four weeks.

The comment stream on this story is now closed.

Volumes sold - REINZ

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Heres an idea... when the LD ends the struggling agents could stand beside a busy mcd store with their handwritten sign asking for help. or hang out at a busy intersection with a squeegee. Give me a break please, nz agents charge whopping fees for the privilege of doing business with them so a one month stand down (if the mkt comes straight back) is hardly penance.


I think you've also unwittingly profiled the expanding number of struggling Speculords. Penance averted by those who are sincere, caring and motivated.

Hey poppy. All this sitting around is helping my waistline expand lol how about you

you are allowed to go out for a walk :)

Should you if you don't need to though?

Your comment makes absolutley no sense?

English not your first language?

If you want to go for a walk..go for a walk...theres no "should you" involved in that decision. So much bad advice posted lately.

You will be increasing your chances of exposure to the virus if you go out for a walk. If going to get food drive the car. In South Africa you can't even walk the dog.

I will take the official government advice keep safe and enjoy that steak.

At yesterday's press conference, Prime Minister Jacinda Ardern put it simply, "act like you have Covid-19" and stay home.
She said police will be moving around the country and asking questions of those outside of their homes.
People without a valid reason to be outside can be reminded of their obligations, she said.


Zachary Smith, from the same article "However, she added that people just getting fresh air should be able to without being told to go home by police, and some common sense was needed in their approach"

Absent the needless paranoia, I'm enjoying a twice daily walk in my local area. There's much less chance of being run over, not to mention the fresh air!

"needless paranoia" just for four weeks.

If everyone could kind of 'over commit' for four weeks we can knock this on the head. Otherwise it'll drag on and on with more lost jobs and destitution. Unless we implement the ZS plan of course.

Good on you RP.
It's an essentially zero risk activity and is important for mental and physical wellbeing.

It's important that we go a little 'overboard" just to be sure. It is not "zero risk". Why are parks closed? The beaches? It is somewhat less risky now because so few people are walking about. Think about it!

….and do you also regard yourself as a seasoned, well informed level headed investor? By practising the required safety protocols we can all make the most of these challenging times :)

No I don't, just lucky.

That's ridiculous.
Life is not risk free.

The risk of getting infected while going for a walk is extremely low, especially if you stay well removed from other walkers.

Just for four weeks.

People thought face masks were ridiculous.

Climb the stairs in your house. I've worked out if I climb them 103 times a day for four weeks I will have climbed to the top of Everest and back down from sea level.

Good on you.
I will keep walking, ensuring large distances from others.

Zachary, a government sponsored advert appeared on this site (as I was reading this "very envious and bitter thread " hat tip Yvil,) stating "exercise locally", which includes walking around the block or indeed cycling ) I would put it to you, climbing the stairs 103 times a day or indeed Everest may actually put you at increased risk of requiring medical care and contact more so, than many others that are remaining in their "bubble" and walking.
As far as the masks go , forget them , other than reducing the opportunity to touch and contact one's face.

I'm pretty fit, have my own gym, regularly do 15km walks in normal times. I'll be okay. I can't believe you're telling people to forget masks. Yes they stop you touching your face which is a good enough reason on their own but they also stop you from infecting others. Would you suggest medical staff don't wear PPE around infected patients?

I am constantly hearing government broadcasts to "stay home and save lives".

Let's make it just for four weeks, please.

Zachary, medically trained, husband working today at Waikato Hospital , please do not attempt to confuse the needs of hospital staff or those on the front line with individuals taking a walk, in regards to my comments around masks .Truly appreciate that you have your own gym and you will be OK.

Applause for your husband thanks cowpat

I'm not confusing anything Cowpat, if you have masks wear them. Peak Prosperity guy is advising the same:

A Simple Way To Combat Coronavirus: Everyone Should Wear A Mask!

Zachary I am unsure who Peak Prosperity guy is or his background .
The latest New Zealand Ministry of Health.
Guidance for wearing protective equipment ( updated Saturday)
28 Mar 2020
The Ministry of Health has released new guidance on protective equipment for people in essential jobs that may require physical or close contact.

If you can ensure more than 1 metre distance from people with potential COVID-19 symptoms and any surfaces or items they may touch – facemasks and gloves are not recommended.
If the nature of your job means you may touch surfaces or items also touched by people with potential COVID-19 symptoms, you may consider wearing gloves, however facemasks are still not recommended.

General population
For most people in the community,

    PPE such as face masks are not recommended

. However, for people with symptoms of an acute respiratory infection, the World Health Organization recommends that there may be benefit in wearing a face mask to reduce the spread of infection to other people.

It's truly amazing isn't it. More people out walking the last four days, than I have seen in 10 years living in my current house.

Kiwi's just don't learn from overseas cos "we are duffrunt". Once the deaths start though (Particularly if it their own dear granny), they will all be moaning that not enough was done.

Like it or not, the PM is going to have to come out and say "STAY AT HOME!", no walks, no bikerides, no ...

You will be able to leave once (and only once) per week to go to the supermarket.

Was up at 6am this morning, and yes have been for a walk already. Do they still hold daily exercise groups during the LD at your resthome?

Things are getting grimmer in the Smith household, now resorting to milk powder. It's not as bad as I thought it would be, glad I bought a couple of kilos. Still have a large roll of scotch fillet steak to get through. A big scotch fillet for lunch every day.

If you eliminate refined carbs, that would qualify as a diet.

"I think you've also unwittingly profiled the expanding number of struggling Speculords. Penance averted by those who are sincere, caring and motivated."

Another meaningless word-salad from Crash Crusader (a.k.a. "Retired-Poppy")


FONMO now commonplace and caused 100% by greedy spruikers


Fear of ....??

Fear Of No More Oldies. Everyone over 65


I think everyone should remember RE agents could make a lot of money from this as maybe a lot of people will still sell and take a loss now to move on rather than wait and see a bigger loss in the future. They will quite happily sell your home and even if market is dropping they want care as long as they get a cut. Maybe they will even get on the band wagon and even create fear that you need to sell before the collapse just to get listings up to keep there pockets lined.


Could turn out to be insignificant compared to what home owners could be facing when the housing market takes a fall in a couple of months.

If "homeowners" are not selling why would it matter that much? It is income rather than asset values that is the main concern.


Yeah, but seeing others lose their so-called paper wealth makes them cream in their pants :D

Basically a much larger response of many in the past month when they are looking at the balance of their Kiwisaver ..

How many owner occupiers took on high levels of debt to buy a house which resulted in high debt service ratios (debt payment to household income)
Due to the economic environment, they now have significantly reduced household incomes? (i.e lower incomes or loss of income due to job loss)

Think tourism related industries such as motels, Air NZ, restaurants, etc

Yes wonder what will happen in places like Queenstown where those in their 30's will have likely large debt to buy their homes there - and now facing unemployment (and possibly significant falls in values if no tourism). Could be a blood bath down there.

Queenstown listings are ramping up by the looks. After lockdown, I imagine the agents are going to be busy listing, don't know about selling though. The denialists are still listing as 'price by negotiation' as they think they will be able to convince you why that property is worth 2 million now and not the 500k it was worth 5 years ago !!?

40 plus billion dollars from tourism gone that has to hurt house prices everywhere but like everyone is saying it will be a bloodbath in tourist hotspots.
I remember back 2009-11 you could buy sections for peanuts in central Otago many mortgagee sales like
80k for 1 acre blocks Luggage near Wanaka
99K Lake hawaea sections
140k Alberttown
Cromwell area 100k for sections
Also Taupo Kinloch area
70-80k for sections at Kinloch golf course.

Also other large international tourism reliant areas might struggle economically?
- Taupo, Bay of Islands, Kaikoura
- Cambridge with Hobbiton.

Some of these areas might struggle ..

To a lesser degree, Rotorua.

Yes - that is a likely outcome.

Taupo worth watching.....all those airbnb and book Bach stuff staving for income and geared to buggery.

"Cambridge with Hobbiton."
There are a lot of backpacker tourists, they have next to no money to spend on accommodation. Hobbiton itself will be hit and indeed it shut its doors even before the LD was even announced.

About a week ago Rotorua had dozens of rental listings in about 3 days. Family bought a first home there about 18 months ago and everyone they were bidding against was in the market for an Airbnb.

Come re-fix time when the bank looks at balance of the mortgage, and the value of the house, you really want the balance to be much smaller than the value. Bit of a bugger if you have to get hit with low equity premiums because the paper value of your house dropped too low.

Imagine people who watched house prices ramp up faster than they could save a deposit, only finally to get themselves a home at the peak of the market. Now they could end up losing equity as fast as they pay down the principal.

Oh well, property is a long game i guess?

"Imagine people who watched house prices ramp up faster than they could save a deposit, only finally to get themselves a home at the peak of the market. Now they could end up losing equity as fast as they pay down the principal."

This was exactly the reason for warning FHB of potential property price risks to avoid becoming potential collateral damage in a property frenzy. Many recent buyers who paid high valuations, may find themselves in negative equity which might take many years to recover their initial equity deposit. They basically face a return of less than zero on their initial deposit. It would have been better for them to have continued renting and put their deposit in the bank and earn 2%.

"Oh well, property is a long game i guess?"

It depends. It's not a long game if you're taken out of the game.

Many owner occupiers took on large mortgages, and high debt service ratios. The household may now face lower income due to job loss (and may not be able to find a new job with a comparable income) and be unable to maintain mortgage payments. The household may need to downsize in a weak property price market and now have to realise those losses.

For example, a friend of mine just lost their job at Air NZ.

I was a FHBer 2.5 years ago. I didn't like the idea of taking out a massive mortgage to live in a city so I relocated to the Wairarapa. Bought at 70% LVR with a mortgage the size of a 20% deposit in Auckland. In the extremely unlikely event we both lose our jobs, the Couple's Jobseeker Benefit + WFF + Accomodation Supplement will be sufficient for us to keep going. Mortgage + Rates + Insurance would be 50% of our "income".


Smart financial choice to avoid buying in Auckland.

FOMO becomes FONMO. Sorry, but they were warned. They chose to believe the spruikers. That was their choice.


They get a month holiday and a $7k payout from the taxpayer.
I don't predict much sympathy for them on this forum.

Most will be better off as it seems only a few sell a large number of properties while most are quite impoverished.


Shouldn't REA's be excluded for collecting any government payouts, they don't really do anything much really except collect over bloated commissions and try to facilitate money laundering when they can.


CJ - I'm no RE but that is a cold hearted statement, it's a job they earn money pay taxes, GST is collected on transactions, these people have families BE KIND


To REA's you've got to be kidding me after all the damage they've done to NZ. Massively inflating the cost of living in our main cities, causing legitimate business to close down and move out, pushing FTB's in to massive mortgages they can't afford! No sorry, I have no sympathy for REA's!

CJ099, if being a RE agent is so easy and earns you so much money as you say, why don't you do it?


Thanks for asking Yvil, but I don't need to resort to being an REA. By the way how's you motel business going?

Badly of course

Yvil - even though I may give you a hard time on here from time to time, I certainly feel for you with whats going on. Hope it all works out for the best. Some of the comments are a bit border line given whats unfolding.


Thanks IO, very kind of you. I am capitalist at heart so I believe in reaping the benefits of one's work and entrepreneurship and if unsuccessful, pay the prices and that applies to me as well of course

Selling drugs makes lots of money and is easy but it is immoral also.


The social harms of drug use are probably a lot less than the social harm caused by the current housing bubble.

According to the RBNZ, as at September 2019, the total value of housing in NZ is $1.157 trillion. It is the largest asset owned by most households in NZ - home ownership is slightly over 60% in NZ.

"Massively inflating the cost of living in our main cities, causing legitimate business to close down and move out, pushing FTB's in to massive mortgages they can't afford!"

That's complete nonsense, you have no idea what a RE agent does, how many houses have you bought and sold?


You're talking twaddle Yavil. You know darn well that massively over inflating house prices pushes up the cost of living having a negative effect on real business and our main economies. Take tourism for example; the higher the cost of living the less people can afford to go on holiday. By the way how's you motel business going?

One day you might post some thing that has a little substance and be of value rather than sweeping baseless statements. Sadly these posting are typical.
Pretty nasty and uncalled comment there also CJ


Since you're all in your little REA bubbles and seem to have no idea about real earned salaries work and the impact of over inflated house prices. Here's a few article examples for you from around the world and yes the same thing has been happening here in AKL.

Better Dwelling: Vancouver’s Tech Scene Shows Just How F**ked Up The City’s Real Estate Is.
Recode: Even tech workers can’t afford to buy homes in San Francisco.

You still don't understand that it's not the RE agents that cause house prices to rise, you're laying the blame at the feet of the wrong people.

Quoting you: "after all the damage they've (REA) done to NZ. Massively inflating the cost of living in our main cities, causing legitimate business to close down and move out, pushing FTB's in to massive mortgages they can't afford!"

REA don’t set prices; sellers and buyers in agreement do.

CJ comments are clouded by envy and his comments look to anyone and everyone to blame.
The reality price is set not by REA but by sellers and buyers coming to agreement.
Anyone who has studied behaviour knows that when one is frustrated and angry about losing they will look to blame some one. It is called shifting the blame, is a sign of immaturity, and not accepting responsibility. It is a common feature of four and five year old behaviour.
CJ has blamed REA here, he has blamed money launderers (when a property sold for more than expected in the upswing of Auckaland prices six months ago) and foreign buyers (when a house sold higher than its quoted CV when it was then shown to be a typo) and he has had a go at speculators. He has also been scathing of FHB. All these acquisitions have been made well after FBB, increase in bright line test, and anti-money laundering.
I have followed CJs postings for some time; they are simply about blame shifting - FB, speculators, and money laundering. CJ’s comments rarely if ever consider market drivers.
It is about time CJ sucks it up, and starts to post some comments with substance rather than those that are subjective and unsubstantiated comments clouded by envy.
Blame shifting does nothing about changing one from being a loser, it just entrenches the emotions of bitterness.
CJ comment regarding Yvil’s situation at a time like this is nasty and callous and reflective of bitterness.
Although you can’t wish REA and Yvil well in these extraordinary circumstances I hope that you suffer minimal impact.

Frighning though that there are 25 upticks on his post, maybe these people didn't read the whole thread and don't realise CJ099 is blaming the REA for house prices rises

It's like blaming the person behind the cash register at McDonalds for obesity rates.

There was discussion recently as to whether there was an anti-property sentiment on this site. This reflects that.
From reading the comments, it seems that there is a weighting of younger people posting. I can understand that there is frustration and anger that many have been shut out of housing due to affordability reason.
However, this is not a reason for continual fear mongering or unsubstantiated comments. CJ is persistent in this regard.
I wish FHB well. The current situation of a global pandemic in 2020 could not been foreseen by anyone. I hope that all get through this and feel that the government has acted in a way to currently give assurance to all.
Slagging off REA and motel owners wishing them any form of undeserved comeuppance is cheap and contrary to what we as Kiwis should not be doing in support of others. CJ needs to pull his head in and make comments with some substance and insight.


High house prices and rents also have a big impact in times of crisis, like now. Because they eat up so much income, most people have very little saved away. It also means when people's income is reduced they have no ability to cover their rental costs.
A large proportion of people have been pushed far too close to the edge by our high rent / high house price reality. A crisis was inevitable, and now we are seeing what happens when it hits. And it's not pretty.

"large proportion of people have been pushed far too close to the edge by our high rent / high house price reality".

Great point. There is no buffer in case of a "problem". The root cause is all the printed money looking for a home thanks to arse covering central bank policy. RE are just a facilitator and Speculords are just a proxy for bank profits, and the gutting of financial stability within an economy. What the world needs is much tighter regulation on the "freedom to abuse" that banks and financial institutions enjoy.

There clearly is room for a remaking to the RE industry in NZ. I would like to see a more independent model that doesn't need the price gouging of the large brand/firm, and of course commissions similar to that in the UK - aka much lower.

CJ099, I'll spell it out for you: RE agents are not the reason why house prices are high, their job is just to facilitate a sale.

Motel is going badly, as I already answered you above

RE Families? So Immaculate Conception really is a thing?


Really think a stronger term than shadenfreude is applicable here....

With their talents or lack of where do they go now? Any ideas? Back to mum and dads spare leaky bedroom perhaps.

You do understand that "Schadenfreude" is a pejorative term?

$7K payout to me?

12 weeks income subsidy @ $585/week = $7020.

Month holiday is not that they do not have to pay but are exempted from paying for 6 months (Relief) and that amount will be added to their loan amount - deferred by 6 months to be paid in future.


With the redicilious profits they have made in past years many will struggle to shed a tear.

Observation from the USA (Mauldin)

The mortgage belt has snapped and we are weeks away from the entire housing
engine collapsing.

Think the chances of this years contestants making coin is lower than whale manure.

Show has been on life support for the last few years. Time to can it for something more interesting like maybe a talking clock or the ol test pattern.

This LD will maybe the end of TV3.

I'm confused. If the entire developed world is printing money to get us through this epidemic then at the end of it there will be more money but since hardly anyone is working just the same assets. Surely that means on average each asset will be matched with more money. Assuming the relative value of assets doesn't vary then each house is matched with more money - if the govt prints 10% more money house prices go up 10%. That is inflation but all I read about is deflation. Of course a crazy assumption that all assets will retain relative values but it is businesses that will go from hero to zero (Tourist hotels, airlines, etc) not houses. Consumable especially food will go up. But if it is inflation so will salaries and wages; I just hope wages increase faster than houses because I don't know how young people can afford current prices.
Something is wrong with my thinking - can anyone offer an explanation; will it be deflation or inflation?

You'd think.
But...that 'printed' money hasn't and won't reach the pockets of 'us'. It will stay locked up in bank transactions ( to support The System).
What we in The Streets will see is a huge swing towards saving whatever dollars come our way (what we are going through now has been a big wake-up call on how close most of us are to the edge) and that will deflate the price of ALL things, as consumption slows down. And if any of this New Debt is ever repaid, who do you think will be asked to repay it? Us! By saving...
It's what has happens in the poster child economy of Japan. Japan was supposed to trigger massive inflation with all the 'free money' and 0% interest rates. All it has done is reminded the Japanese people of the forgoing, and they have had Deflation for most of the last few decades now. what's coming to the rest of us.
In short - there will not be more 'dollars per asset' there will in fact ,be less.

For me personally that is quite an optimistic outlook. I don't like heights so generally stayed away from the edge. Even more so in the last couple of years.

One thing I have been wondering about is the prevalence of revolving credit accounts. People used these as a buffer but will the banks start to withdraw them? Would it pay for people to withdraw cash from them and deposit the money into savings accounts in other banks? Feel a bit apprehensive about mentioning it.

That's going to be an interesting question to be answered.
That's kind of why I suggested 'Borrowing all you can; don't spend it and keep it in another bank that is't the lender!". But the cost of that has been prohibitive. What's I've done is use a bog standard OffSet Account. But at the first hint that the balance might get 'quarantined' it will be off to another bank.
So I understand your question, and if I had to take a stab at an answer it would be: "They wouldn't dare!" - so as not to risk my, your and anyone else's money heading out the door. Not for protection from bank-insolvency (not a real issue), but to protect liquidity.
A banks lifeline is Liquidity. They will want to keep of much of it as they can. "Taking it" and making a forced loan repayment or reducing a Committed Facility (revolving loan) doesn't do that. It is Deflation, writ large.
So just keep a weather eye open - as you appear to be!

Many companies in the US are reportedly fully drawing down on their revolving credit facilities to increase their financial flexibilty and due to fear of the facility being taken away by the bank.

Yep a variation on the Japanese experience is here and will be with us now for a long time if not forever

Lapun, you are not confused at all, you are actually spot on

Neither inflation or deflation, but it's evil cousin... stagflation. Zero to low growth and high inflation. Ugly. More money chasing fewer goods. Fewer goods due to lower growth. Another unendearing feature of stagflation being very high unemployment. The last time this happened tons of Kiwis fled to Australia. They don't have this option this time.

Moves to spend by the govt are the right thing to do at this time. But how to pay it back and break the gridlock caused by stagflation, increase the cost of money.. high interest rates. And reduced spending on government services. Aah but we need those services and have been shown more than ever how valuable they are.

I'm taking the view to hedge... hedge in every way possible for either inflation or deflation or stagflation.

It's a weird upside down world now. Glad I don't own commercial property.

Lapun its a situation theory calls stagflation. Its caused by an complete failure by central bank policy. As costs race up, staff demand higher wages, employers have to cuts non essential jobs and other costs in an effort to survive. Its is inflation on the one side and stagnation on the other, a double whammy.

Shall we start a collection for Real Estate Agents ?

I have a whole host of RE mags that I've grabbed over the years for weed mats. I could donate that as they need to start a vege patch about 3 weeks ago...

Airbnb hosts and owners of other short-term rental accommodation are scrambling to get properties leased out longer term, as bookings from international and local visitors dry up....“The honeymoon is over,” said (rental agent), who has been contacted by more than a dozen hosts – some with multiple properties – in recent days.

Yep that will flood the rental market and push property prices down further, they're called 'Reluctant Landlords' same thing happened during the GFC in Europe. Though Airbnb holiday lets in more out of town areas are going to find it difficult to get long term tenants.


If you look at Queenstown rental listings for the week they are up by dozens. 3 bed 2 baths, modern house for $800pw. Who's going to rent it? There's no tourists, so there's no money, so no work. The whole place is a one trick pony.

There's going to be some real bargains there I'd say.

I haven't been to Queenstown in 30 years, I hear it's the Gold Coast of the mountains.

I hear its munted.

Yeah. It's gonna be a bloodbath.
So will Auckland CBD.

I assume many of the airbnb 'hosts' are also on the blower looking for a mortgage holiday. I see many (fully furnished places) on trademe offering fairly short leases. But the shakeout is really just starting.

Many properties were taken out of the long term tenant market and went into the short term Airbnb market (due to to more financially attractive economics) potentially leading to unaffordable rents for long term tenants.

All those properties rented out on Airbnb now coming back onto the long term market will hopefully result in lower prices in the rental market so that rents become more affordable for local resident renters.

Having said that, some of the Airbnb properties may not meet Healthy Homes Guarantee Standards I hear. Specifically regarding insulation.

Many of those properties were purchased at higher property prices on the assumption of higher revenues due to Airbnb compared to long term tenants. If those properties are now earning lower levels of income, that property may now be in a negative cashflow situation. If the Airbnb market does not recover after the lockdown, the owner may choose to sell and relieve themselves of their new cash burden.

If buyers assumed long term tenant rental revenues, then based on those economics, property prices may be lower.


Realism & Solutions

Real estate leasings and sales have tanked, just like the sharemarket; largely due to overpriced assets. Purchasers are cancelling contracts, and some may forgo deposits in doing so. A big developer told me so.

The smart people in the real estate business will have put some cash away for this rainy day (more like rainy 2 months), and be conservatively geared. Sadly, this probably represents not more than 20% in the business.

This will result in asset price corrections, back to where the masses can afford. After this correction, government should take the opportunity to regulate loans and rents, to a level which has long term sustainability; to take all the market distortions of the accommodation supplementary (landlord and bank subsidy) out of the equation.

I'm picking the government wont take up the opportunity to regulate the mortgages and rents to a sustainable accommodation cost and earnings ratio, as they have been captured by these overseas banksters (and the few they serve), who want the subsidy and extra business to keep their inflated profits.

Recent evidence of the politicians (and public servants below them) have been captured by this lot is the issue of government bonds in the billions of dollars to them. With our own currency, our central bank only had to print money (like China is doing), which would have avoided additional interest payments to these overseas parasites. Sure, it would have lowered our currency, but made our export prices more attractive. Is exporters who are going to dig us out of this hole, so that lowering your currency isnt a bad thing either. These overseas
(vested interest) bankster economists will tell you different.

Great post


For a long time I've been saying all rental subsidies should be canned. By doing that the country would save billions and then landlords could only charge real values.
I would guess that house prices would also come down with that.

Agree completely. I've been saying for a while that if we took away accommodation supplements it would probably be the landlords who would complain more than the tenants - yet many of the landlords whinge about the welfare state and lazy parts of our society who are tenants and should try and get ahead by buying a rental. Just need to look up the definition of hypocrisy quickly to remind myself what it means...

"Purchasers are cancelling contracts, and some may forgo deposits in doing so. A big developer told me so."

That significantly increases the cashflow stress on a developer.


This is a truly bizarre article. For years it has been stated that house prices will not correct unless there is a drop in immigration, rise in unemployment or a major Black Swan Event occurs leading to a major recession in NZ (and this recession will be global and much more severe than the GFC).

And yet when all that happens in one hit, the Real Estate Industry claim that it will be business as usual by May?

Anyone else's head spinning?

Most of us realise now that "It isn't going to be business as usual in May!"
Many, many businesses are going to fail over the next few weeks, for no fault of their own, and those employees will end up workless for the same reason.
The Government Wage Subsidy is going to have to go on a lot longer that just 'the next few weeks'
It's inconceivable that at some defined date in May the Government could say "It's over! Go back to work, and by the way, the Wage Subsidy is off now"
It can' be. It will go one for many, many months after 'it's over' on a sliding, reducing scale as we try to normalise the workforce.
What Normal will look like is anyone guess. But it won't be what it was before.

Be interesting to see who business owners favour in terms of recruitment when this is over. Most people in their 60's will hopefully be mortgage free now so as an employer, would you take them on knowing they had no debt, have a very reduced future value to the company and will soon receive super payments.

Or do you hire the younger person, with the mortgage and decades of future value/growth for the business?

The same argument stands when it comes to the unfortunate decisions when needing to let staff go over the coming months. The more unfortunate thing about the situation is that it is probably those who are mortgage free who remain and are in the management position/s that make the decisions to get rid of the more junior parts of companies.

bw, I don't think you realise the wage subsidy gets paid out now for 12 weeks, so untiled of June (I don't disagree with your post though)

Its classical bubble psychology. Think we're between the 'denial', 'return to normal' phase of the cycle in the property market now.

Stock market, based on VIX and market pricing is now (in my opinion) about to transition between the fear and capitulation phases, which will likely (in my opinion) lead the property market by 3-6 months. Could well be wrong, and there could be a remarkable turn in events, but with so much leverage/debt in the system and such a big fall in GDP likely this year and redundancies, it would need to be some form of a miracle.

Perhaps we need Miracle Max

Miracle Max : He probably owes you money huh? I'll ask him.

Inigo Montoya : He's dead. He can't talk.

Miracle Max : Whoo-hoo-hoo, look who knows so much. It just so happens that your friend here is only MOSTLY dead. There's a big difference between mostly dead and all dead. Mostly dead is slightly alive. With all dead, well, with all dead there's usually only one thing you can do.

Inigo Montoya : What's that?

Miracle Max : Go through his clothes and look for loose change.



You just have to remember if these people had two brain cells to rub together they would have real jobs instead of real estate jobs.

All the agents I've used have been great and I've used a lot. As over 90% of sellers use an agent you must be saying that we have only one brain cell. ..or maybe we know something that you don't.

"And yet when all that happens in one hit, the Real Estate Industry claim that it will be business as usual by May?"

Greg believes that interest rates might stimulate buying, but perhaps assessing the likelihood for rapidly rising unemployment to be temporary and inability to meet mortgage payments after the lockdown to be low.

Some intelligent people (who are business people) do think that a speedy recovery to normal levels of economic activity will return after the lockdown.

Some businesses will undoubtedly be able to bounce back but with closed borders and disrupted global supply lines, it would be very naive to imagine that by May we will be anything like business as usual for many industries in NZ.

I am inclined towards the Robert Schiller theory that the economic narrative can be the most significant whatever becomes prevalent during/after this crisis will potentially have as much of an influence of the global economies as anything else. We have no idea what that economic narrative is yet, all the narratives are in a state of flux but we are not always a rational species. Of that I am quite sure.

Great comment.
There is likely to be bounce back after the lockdown, but I would say it's likely to just be a brief one.
Human nature is that many people will celebrate their reinstated freedoms. For example, I am looking forward to some self indulgence at favourite cafes / restaurants.

So I think there will be a blip of major activity, and then a reversion to something that won't be great

"For example, I am looking forward to some self indulgence at favourite cafes / restaurants."

Some may close down. See Gordon's comment below.

Few small business owners of retail businesses have sufficient cash on hand to meet expenses for say 2-3 months with revenues of zero to 50% of normal revenues where rents are a high proportion of normal revenues.

If those businesses have closed down, those jobs have also gone permanently. And they aren't coming back for a while. Those business owners may not have any capital to start again for a while if at all. It will likely be the next generation of small business owners who will start the next popular cafe in your local neighborhood and employ new staff.

Gingerninja - agree. I've read most of Shillers books. Have been listening to the 'Narrative Economics' book once more recently to try and best understand whats unfolding from a narrative/psychology perspective - because market fundamentals of late haven't seem to be driving markets (i.e. a rational market).

You can see what Trump is attempting to do - but his optimism could be too far detached from reality that he may start to look like the fake news. Time will tell.

No doubt the virus narrative is and will have huge economic effects.

Most Americans don't think that it is a good idea to reopen by Easter.

I think Trump is acting like a business man not a politician or leader.

It is also a function of confidence.

For example when stock prices were rising, many investors were confident that prices would continue to rise and bought more stocks. They were also willing to make many discretionary purchases - international holidays, boats, new cars, house upgrades, etc

When share market prices fell rapidly, investor confidence fell.

Look at many investors reviewing their investment choices in Kiwisaver. Many have seen their balances fall and are switching from aggressive growth funds too conservative funds.

Another key variable is the availability of bank credit ...

I am losing track of days (daze), it's not April Fool's Day yet?

The last house we sold, we sold via an online viewing. Listed it ourselves via TradeMe. I walked the sellers through the property via Messenger. We discussed various things back and forth via phone call and email. They forwarded a contact via their solicitor and we signed it.

The one before that we also sold privately, again via a TradeMe listing, but in this case to a local.

I think a lot more folks might be thinking along these lines in future, particularly if they have a good solicitor working with them on how to conduct a private sale transaction.

I think kiwis generally like to be at arms length. Still can be your way but I suspect the reset will cause a frenzy like feeding piranhas with massive reduction in commission levels and agents freelancing and being supported by the wife or mother in the "back office" (kitchen)

Hahah excellent post

I would personally much prefer this. The hard sales behaviour of the RE industry makes me feel quite nauseous and its extremely overdone.

We bought our "forever" home last April. The agent was a revelation. She was honest, direct, reasonable and fair. After 3 years of looking for a house, it was an actual revelation to comes across a different style of RE agent in NZ. I would certainly relish a more down to earth, honest process. Not that I plan to do much house purchasing in the future!


'Quite a strong bounce back in May'
Come on, Greg.

He might have rentals?

Such cynicism IO. IO you tried to convince us that you're open minded but are you?

Open to all possibilities here Hosueworks - Greg may own rental properties (if not he will own his own home) so has a bias towards property prices continuing to rise. If we could have disclaimers on peoples positions, it would be much easier to identified unbiased opinion, and give people believability weightings to their thoughts (a system similar to what Ray Dalio uses when assessing information at Bridgewater).

Being open minded, I'm trying to filter out the biased opinions, from the unbiased opinions. Helps me determine what is likely true and what is not. For example, if you said you own $2million in real estate, then tell me property prices never fall, I'm going to assess that you have a bias so your opinion is less believable than someone who is independent from the market and can make a more critical (unbiased) assessment. Equally those who have been locked out of the market would like it to fall, so they're more likely to make claims of it crashing. If we add all of those points of view together, in a believable weighted way, I'm more likely to find something closer to the truth, than just making statements based upon what my bias is driving me towards (take a look at TM2 for example - his statements are almost always just his bias speaking, not a balanced view that updates with changing conditions).

I don't currently own a home in NZ after being overseas during the boom and think its possibly significantly overvalued - so I'm aware of my own bias (hoping for a fall) and account for that when judging what could be the most likely market movement. But equally have had shares in the market and realise its all interdependent, so a fall in the share market is likely to influence property (and vice versa).

That ok with you?

I appreciate your honesty. Are you fully open to the position of "Quite a strong bounce back in May"? You wanted me to accept the possibility of a 50 percent fall which I do, the probability of which is infinitesimally small. But you cant have it both ways, (no gains only falls) or can you? As well as bias you need to take into account motivation. TM2 is a believer in what he does, and states his experience. If you dont agree with him he is no worse or better off as opposed to the salesman on your doorstep.

Absolutely - there COULD be 'quite a strong bounce back in May'. But if I add in all of the information around risk of defaults on loans, high unemployment, low confidence, commercial property problems coming to light, then my weighting towards that outcome is quite low. But yes it is definitely a possibility that it will happen. But then if I add in the possibility that we are still in lock down in May, it makes my weighting towards a 'strong bounce back' at that point less likely.

I'm not sure if you fully appreciate your bias yet? Many property markets in the world have fallen. NZ isn't immune from that outcome - which you have describe at infinitesimally small. Stock market bulls on many platforms I follow were also saying that early this year - yet now the probability of a 50% fall is reasonably likely in my opinion (and I have skin in the game in that market - but open to the fact that it may happen).

Motivation has nothing to do with outcomes. e.g. I'm motivated to run a marathon in 30mins. It isn't going to happen. Its delusional to think so. And yes I consider TM2 to be a snake oil salesman. I still consider his point of view however as he might be right. But his bias is too strong for me to take his opinions seriously (or give them too much weighting) - I might give him 10% weighting on his views. Other commentators here who have been through bubbles before and have more balanced views I may give 60-80% weightings. I give you about 20% as you seem to have a strong bias towards housing but haven't seen you consider other things that could also be true - so find it more difficult to give you believability.

LD after 23 April will invoke a negative community reaction. I am willing to bet it would be a strong reaction. Jacinda and co will suffer as a result of an extension and she knows it... I am picking that they will remove category 4 at least a few days beforehand so they can win political favour. Just remember they are talking tough to keep everyone in line. Are you open to that possibility? Thanks for the 20 percent rating it is double what you give TM2.. yet imo he is a much more disciplined landlord than me

Open to that possibility Houseworks but think you're missing the big picture - enjoy your Sunday.

I think you're overstating the risks such as loan default risk, also commercial property rents. Our commercial tenant requested through our property manager for help. I have seen their financial statements, they (the tenant) make big profits on a small investment and are always taking overseas holidays and having a manager run the business so are just trying it on

I wish all of us luck, but I just don't see the lockdown will end in 4 weeks as planned.

Level 4 will end by 23 April if not a bit sooner. Definitely

Could you elaborate a bit more?

Here's a random thought to add to the conversation!
"A Wealth Tax is coming " (- think TOP policies etc)
At the very least we should expect that the Aged Pension will get Means Tested at some stage.
So for those that need to be, be prepared.

We will need more taxes, that's for sure, to pay for all this carnage.
Income tax on people earning over 100k needs to be increased.
Business tax should also be increased, perhaps by 2-3%.
Gst should go to 17.5%.

Could be. But tax increases, such as those you mention, might hit the consumer; the worker etc harder than WealthTaxes.
Whatever. Something is coming....

Yes they won't be without consequence. But what's the alternative? More and more debt?
The govt's revenue is going to be whacked for years, they will need more revenue.
They need to look at their grotesquely oversized bureaucracy too (but they probably won't). I have worked and around that bureaucracy over the past few years, it really is hugely bloated with thousands of 'policy analysts', the vast majority of whom add little.

Income and fuel taxes up - govt needs the money.
GST and business taxes down - the low paid need more money to spend and businesses need encouragement - our business tax rates are higher than other countries so if you had a choice in which country would you make business investments?

I don't know if lower business taxes are tenable. They might be if land taxes and CGT is brought in.
This can't be a revenue neutral exercise though. We will need much more revenue.
This conversation needs to be had urgently. We can't wait years for fluffing around with inquiries...

Don't know why we need to tax productive income so hard when we let income from speculation off so easily. Just discourages productive enterprising types.

A land tax or CGT?

Land tax. CGT gains revenue very incrementally over years. Having said that, we will need all the revenue we can get so it shouldn't be off the table.
This is the perfect time to get the conversation going.
Perhaps could get someone to do an article on this?

CGT is a great concept but reality would be a lawyer and accountants bonanza. What about stamp duty on property?
Land tax would be easy to administer - just tweaking the rates bill [hope Mr Robertson doesn't read this our house is $250k on a chunk of land valued at $900k].
How about a taxes on something highly popular but low impact on me: fast food, all online purchases, flights, fuel.


As a young whitesock in the 1980's I gave real estate a go for a bit. After the 1987 crash we went from dashing between appointments to selling three houses in 12 months. The crash happened LITERALLY overnight. Its hard to believe it can happen until youve lived through it. Luckily I was flatting and had no family or 4WD lease to care for.

Very interesting.

Very interested to hear more about your experiences post 1987 crash and the property market post 1987 crash.

1) What area did you sell in?
2) What happened to house prices?
3) Why were the vendors selling?

Given your experience, what do you think is likely to happen with houses prices from here?

1. Oxford, UK.
2. Price trajectory depended on why people were selling and their financial circumstances (see 3. Below). But mostly, they werent able to sell, so stock simply stagnated. Eventually (after a long time), people lost interest in houses for 10 years and got on with real life.
3. Reasons people were selling (if they could sell at all) were basically any other 'normal' reason than speculative moves, e.g. job moves, divorces, deaths, growing family, etc.

Sorry no idea what will happen to prices. If the market valuations are based on actual future sales then theyll be all over the place.


Thank you very much for sharing your experiences and thoughts with us here.

Imagine what NZ could achieve if the country would stop being obsessed with property investment for 10 years and focus on bigger aspirations.


My son who lives in Wellington normally is home with us for the duration of the lock down which is great. He is a CA and is talking to all sorts of people in Wellington including those he works with. To a person everyone has a parent , sibling , relative or friend who has been made redundant. Some business owners are not taking up the wage subsidy. They are just walking away from leases, making staff redundant and shutting shop. It’s too tough for some. We all need to pray and hope that we come out of lock down as soon as possible as the human carnage Is going to be huge. Everyone in this great country of ours needs to obey the lock down rules and help. Together we can beat this and we need to beat it and minimise the damage to people’s lives.

Unfortunately people are just refusing to stay indoors gordon. Got to go out walking.

Do we really want to come out of this lock down as soon as possible? Its quite possible if we do and infection rates climb once again, we'll be back into lock down for another period of the same length and the problem escalates even further. No sure what the lesser of the evils are in this situation.

IO I did use the words “ as possible”. I am thinking we will be in lockdown for 6 to 8 weeks minimum and then there will still be huge restrictions especially at our borders.

Add in the loss of income to those who were banking on dividend payments from companies, that will now be suspended (31/3/20 for starters), and there is a combined HUGE amount of disposable income gone missing from all of our economies. Income that won't be replaced any time soon - if at all.

The economic and financial carnage of all of this is going to be huge, sadly. And the social fallout.
Very depressing.

The human race needs to take a good hard look at itself.

Yes, lost jobs, lower dividends, lower household income.

Likely to see overall consumer spending decline. Lower discretionary retail spending, lower capital spending (car purchases, boat purchases, whitegoods, TV's, etc), lower levels of dining out, fewer international holidays taken, etc

Yes interim dividends will be suspended. FBU already cancelled their april dividend that went ex earlier. Could be a top up later when businesses reopen.

I know a few people who seem to be living in a bubble and don't seem to realise the carnage this is causing. Their jobs are secure and they don't seem to understand or empathise with the fact that many jobs are not.

Unfortunately many times empathy is learned via personal firsthand experience.

I suspect that your firsthand experience during the 2008 GFC have had a lasting impact on you.

Yeah it did. I think I am fairly empathetic anyway, but that experience was certainly 'character building' and I know what it's like to let go of staff as well as have reduced income myself.

Gordon, I suggest that businesses who already close down now have been struggling before. I own businesses and there's no way I would "close any of them and just shut shop". If your business was doing well before the lockdown then you have reserves to carry you over for several months and the hope you can rebuild with less competition later on.
BTW what's a CA?

Usually the abbreviation used for a Chartered Accountant.

Yvil most small businesses have little or no reserves. Fact. Owners pay themselves small wages.

Know of many small business who were surviving to pay minimum wages to themselves after paying rent, wages to their employees and other expenses but were running the business as had no choice - hard to find jobs and also had paid a bomb earlier to to start - buy business and have business loan to repay.

It is not recession but depression for them. Very hard for many who are lucky and not facing the GREAT depression.

Yvil, As someone in business how come you dont know what is a CA? Am shocked.

I didn't know the abbreviation "CA" (even though I have a "chartered accountant")

First thing I think of when someone says CA is certificate authority (but I work in ICT)


RE Agents have made heaps during last few years so should not be crying if unable to do business for few weeks and take a hit by few percentage dip in profit (still no loss).[

Should look around them and be satisfied as many industries which were earning to sustain themselves on a weekly basis may end up shutting down and if not shtting may take months to revive if not years.

RE agents are now trying to create FOMO specially in FHB.

Entire RE machinery will be go out in full force to create FOMO and to get sell asap, if possible now or just after lockdown being fully aware that going future housing market is going to take a hit, so earlier one is trapped better.

Hard to believe even for die hard optimist person that when entire world is shut for few months and economy comming to a halt with many business shutting or losing earning and with many losing jobs or taking a percentage of their salary and Still believing that housing market will be immune.

Even a normal person can see the writting on the wall where housing market along with world economy is heading and who doesn't is either ignorant or just stupid best to be ignored by all.

FHB should be patience as now is the time to wait as will get some softness after few months. For now just after lockdown, buyers who were already in market may earlier, due to FOMO created by RE lobby or by themselves may rush to buy and also will be a while before vendors changes their expectation from earlier high ( before lockdown) and this entire process will take few months.


I understand many agents own multiple properties. So simple solution if they lose income, sell one or more properties!

worth a watch at 1 min 46 seconds into it.
The Australian property bubble just popped.

The process has just started and this downside would be something that no one ever imagined just like so many things in last few weeks.

What is happening now is surreal. Who would have imagined just few months back that entire world will pause for few months - total lockdown of more or less entire population of the world AND RE Industry still looking for a boom. Many RE Agents have only seen good time so will only learn after experiencing it, which will be soon.

Hope for the best and prepare for the worst.


"The process has just started and this downside would be something that no one ever imagined just like so many things in last few weeks."

Just read about a persons change in financial circumstances:
1) just lost their job
2) owns 2 investment properties, that are now vacant ...

Now if that person has even a reasonable level (not high) of mortgage debt to finance those purchases, that is a huge change in financial circumstances ...

If the person is unable to rent out their investment properties to be cashflow positive, what is that person likely to do? What would you do if you found yourself in those circumstances?
There could be many property investors now in similar financial circumstances ...

That could lead to a huge imbalance of effective supply vs effective demand.

Meanwhile the property promoters remind us that there is population growth, inward immigration, NZ is a desirable place to live in the world, an underlying shortage of housing as everyone needs somewhere to live, retirees want to buy investment property for retirement income and property prices double every 10 years, and that property prices did not fall by much during the GFC in 2008 or the Asian Financial Crisis in 1998, so they are unlikely to fall by much during this economic disruption ...

The race to debase currencies...

As usual, when the idiotic kids find their playing with money has gone wrong they seek to take it out of hard-saving grannies' wealth instead.

'In which case the effects of the lock-down could be felt for a lot longer than four weeks'

Did you really believe or thought for a moment that the harm to the economy / business or housing market will be only for the period of lock-down ?

It will be a while before the sentiment changes and whenever it changes after a year or two or more it will be real stock that will bounce back first before the illiquid housing market.

Anyone in for a very long period and cash rich with good health may get an opportunity of a lifetime in future but not today, not next month, not next quarter but sometime in future.

Jeez, this complete obsession with real estate is becoming ridiculous both here and in Australia. Buying and selling houses is the last thing we should be thinking about!

Correct as in NZ by many, only economy for Rock Star Economy = Housing Market.

Do not believe, check with National Party who ruled NZ for 9 Years and now Labour who fought and won election on housing crisis (Ban on Foreign buyer) but soon realized that Sir JK was right (Dumped Capital Gain Tax - one of their election promise).


I could not agree more. I live on a lifestyle property. I am thinking about growing food and collecting fuel for warmth each day. I know my big expenses such as overseas trips etc have gone for a long time. I am going to live as I am in isolation with those I love. I am ringing family friends and neighbours and giving them support. My overall cost of living is dropping big time. All I need to budget for is food, power, rates and insurances. In fact I might need to learn to drive again. Life is simple. In fact I like it.

'In that evantuates , many buyers and sellers that have decided to postpone their plans for a month or two may decide to postpone indefinitely'

Decide to postpone indefinitely......for many it will be not by choice but by circumstances that they they may have to drop any plan of buying a home or investement or even holiday and the number may surprise everyone and will know only after the tsunami of corona virus has passed - which if lucky is not before next year.

Many feels specially experts that they understand the gravity of the situation but fact is no one is able to imagine the carnage that will be left to be cleaned - Economically and Socially

Makes sense:

Eaqub says he doesn't want to oversell the optimism. "Once we come out of this, we're not going to have open borders.
"We're not going to have immigration… which has been quite a big part of our economic growth.
"We also know that we're not going to have tourism, which is about 10 per cent of jobs."
Many have pinned their hopes on domestic recovery, as Kiwis emerged from isolation. But that won't be immediate,
"Our banks are very good at lending money for mortgages, but they're not very good at funding businesses and startups.
"So unless we can see the Government and the Reserve Bank, essentially, tweaking and redirecting our banking system, to really push hard on that side, the recovery that happens is going to slow."

"We're not going to have immigration… we're not going to have tourism... Our banks they're not very good at funding businesses and startups."
This man Shamubeel Eaqub just cant get it right. He famously talked about zombie towns, not buying a home and that 100k kiwibuild was inadequate as the govt must set a target of 500,000 new kiwibuild homes. Ferken lol
Has he heard of kiwis returning home, of domestic tourism, of the govt guaranteeing business loans?
He talks calmly and people fall for his "opinions"

Right that Shamubeel Eqaub .......but now, one does not need to be an expert as any Tom, Dick and Harry will tell that it is good to be positive (Hopee) but reality is that everything else has gone for a toss for sometime to come be it it housing market

I'm not sure what returning Kiwis are going to do?
Those we have here are going to find it tough enough to get what jobs there are about. Many, many businesses are going to fail either over this time frame or shortly thereafter as a result. Those that were weak heading into this stand no chance. (I already know of one that is taking the subsidy, as he should, but telling the 5 staff to"Look about for another job, because when this is over I'm not opening up again")
And which of us is going to have the surplus cash to go on a local holiday? Some, sure, but most people will be flat out repairing the damage to their household balance sheet and shoring it up 'just in case'.
As for 'guaranteeing business loans' - that's a given and most likely the forerunner of the Government taking failed companies onto the Public Balance Sheet, and if Air New Zealand isn't the first - I'll be surprised! It's called Nationalisation, and , yes's coming.

There could be no kiwis coming in or there could be thousands. But judging by the number of daily covid tests of foreign travellers then there seems to be a lot. They probably wont have jobs in the short term but they are consumers nevertheless and the govt has dropped the benefit standdown period, they will have assistance and will need to set up homes. 80,000 permanents replace 2M tourists by my calcs and tourists dont have jobs either. The spending will be in different sectors of the economy though not the motel and travel sectors as much. There again how many will need emergency housing. The economic balls are still in the air IMO so who knows where they will land. Do you concur with this?

"There could be no kiwis coming in or there could be thousands"

Will be interesting to watch Kiwis in Australia. If they lose their jobs and unable to find another one, they might return to NZ. Unemployed Kiwis in Australia are unable to claim any unemployment benefits as I understand.

Had a friend return to NZ in September last year after having worked abroad for two decades (Australia, UK, Singapore). She returned due to a desire to be in closer proximity and spend time with elderly parents. She hasn't been able to find work in her area, but is helping a friend out in their business for the time being.

Most if not all of Saturday's 85 positive tests were from those who arrived in the country. There are approx 1600 tests happening per day. Extrapolate that as one in 20 arriving has covid although there could easily be more than 1600 international arrivals/day. Still at 1600 that is 33 thousand over 3 weeks. In Australia alone there is over 600 thousand nzers on special category visa. These people are mostly on low wage jobs who will be suffering the sudden job losses. I think for many Australia is their home so they would do whatever they can to stay there.

In my opinion he's the most overrated economist in the land. Loves the spotlight, not a huge amount of substance.

Paid for every appearance let's hope it was token fee

I just read an article by Steven Joyce, Thank goodness he's no longer Minister of (Anything!).
A Form 5 Economic student could produce a better Think Piece than this!


It seems reasonable to me to think about 'where to from here'.
The decisions taken by the government have been the easy ones, and mostly the correct ones. And they have been popular.
The really hard decisions are still to come.

I think it's a really good piece. And I am not his biggest fan, so that is saying something.
He's quite right that we need to start planning for a transition to 'normality'. He is right that we can't be in full lockdown for too long.
He is also right that there are and will be calamitous economic and social impacts, often affecting the most vulnerable the most. The longer we stay in lockdown the bigger those impacts will be.
And he's also right that we need to pay for this all, and the longer there is economic carnage, the more likely cuts will need to be made to things like healthcare in the future.

As the sayings go 'right wingers know the cost of everything and the value of nothing's while ' left wingers know the value of everything but the cost of nothing'

"The only cure to the economic disease is to get back to work .. There are roughly three health scenarios ... the most likely seems the inconclusive one. In that eventuality we can't just roll the lockdown on as is – it will be too costly. We need to somehow get some economic blood flowing, and that will require some inventive thinking."
1. all the opinions I have read on here are that the LD will be extended. Maybe commenters have looked at what's happening in italy and china. Until now I have been the lone voice to say it wont be extended and with luck the LD will be shortened slightly. You heard it first from me
2. I really hope that the Govt is thinking hard. Grant Robertson is a much smarter cookie than Jacinda.

"It's time to put those health oficials, some top business people, and some economic experts together in a (virtual) room to talk it out."
If it's up to health officials we'll be in LD until Christmas. The health professionals and advisors have done a super job with a few mistakes so far but soon it will be time for them to shift over and let the business brains take over. I doubt there will many certainties in the community after the LD so we need to operate with precaution. Not abandon life altogether.

Thanks for the great link bw. I totally disagree with you though, I'm so happy someone is finally asking "what's gonna happen after the lockdown, how do we survive economically".

it's great piece by Steven Joyce and about time somebody asked "what happens after the lockdown"

The least we need to worry right now.. 'alive or livelihood'... don't worry too much JA already gave assurances to the Nation, peoples should not force into selling their house/home just because of Covid-19 - For now, just stay put due to a means for breaking the chain of virus spread. Once the cloud is clear, rest assure that the govt. will do whatever necessary to maintain the stability/upward trajectory of the RE industries in NZ as means of 'investment' which bring excellent GDP numbers , we already put the OCR down by 75 basis points, further reduction is on May, This April oncoming banks deposits guarantee; will reduce & flexi time for banks to implement it, CAR already deferred from 5 to 7 yrs, CAR liquidity is 75% to 50% with further reduction is anticipated, We already seen the banks moves on this.. lower home loan rate!, mortgage deferral/holiday then these LVR requirement & FHB deposit shall all be removed as Banks already indicated their willingness to be more prudent on their lending criteria, they already pinky promise the RBNZ chief, during discussion with Orr's team when the suggestion popup about DTI tool request, phuih.. it has been torpedoed down. More borrowing from overseas ... secured to borrow printed more money/numbers from the US, up to the 2022. In which by then the whole Nation/all govt apparatus senior echelon of decision making process ready to roll out the red carpet for OBR. NZ is the first creative nation to show the world as we're into the most advanced technology driven nation, we shall be in mature position to do virtualisation of our work force. By then the world will have to follow our example, in order to maintain our Healthcare budget/strength of a Nation? it can only be achieved by steady maintaining our active production of Wealth creation. GDP up, taxes up (a follow on effect from RE upwards number) it is a sure, realistic answer for the world. There's no two way about it.


$135 million lost in residential sales commissions by real estate agents over the 4 week-lockdown period! That's actually $135 million SAVED. Which otherwise would have gone for unproductive services which do nothing to add on to the Value of house.Only add to Prices of houses . Time for RE agents to get a job.A real job.

Houses suitable for leasing to Housing NZ could be good to buy in the coming months. I never used to recommend these in the past but now it seems they would be good to have especially if you already have one. My how things change.

Or land to build them on? Become a developer Zachary as finance will be dirt cheap and easy to obtain.

Land prices might also be a fair bit cheaper.

Agents should be liable for losses incurred by new buyers. This would make them suddenly become ethical.

If a legally enforceable fiduciary duty standard was imposed on real estate agents, property promoters, mortgage brokers, etc, prices may not have got so high in some locations and there would be a lot less collateral damage. Big Data's personal experience about their mortgage broker suggesting that they commit mortgage fraud, just illustrates how much owner occupier borrowers had to stretch to become property owners ...

They have attempted to bring in fiduciary duty standards with bank lenders with the Responsible Lending Guidelines ...

Need to keep an eye on the bloody supermarkets, I thought that prices had inched up:

Just did a quick dash to Countdown to grab a few smalls - thought I'd get in before the Monday hoards. Perhaps 10 people in, and shelf packers everywhere. - and you're right!
What would have normally be expected to cost about $45 cost $78! eg: Coke, often 2 for $ $4.50 is now $4.50 each etc...
( That's the drawback of keeping a spreadsheet to see how inflation goes, and they aren't doing 'specials' at the moment!)

Britons in New Zealand told the Observer that the only available flights to the UK are prohibitively priced with even the cheaper tickets costing as much as £15,000. A Qatari Airlines flight from Auckland to London on 31 March was priced at NZ$83,534 (£40,096).....(there) are believed to be an estimated 6,000 Britons marooned in New Zealand.


Thanks for the update. That's poor!

Hmm, I was at Pak N Save yesterday. All the specials were still on, i.e. 2 litre Pepsi for $2, 26 pack of Nescafe Coffee Sachets for $12. I spent more than i normally would because I purchased 3 boxes of coffee.

It's times like these that having so many people on work visas in highly vulnerable sectors could be a blessing for NZ.

Yip, as per indicated here by one of NZ expert:

RE is one way sure bet folks! - nothing more, to it - not, a single NZ economist would say otherwise.

Would'a been nice to see no cheap shots on a headline like this; disappointed.

This is well worth watching to get the expert view from Korea. The best video I have watched about the virus and I feel pretty confident we can get on top of this.

You Need To Listen To This Leading COVID-19 Expert From South Korea

Its going to be a case of managing this calmly over the coming year. Hopefully some good will come out of it. I actually think humans should do less travelling around all the time. We should do a better job of avoiding influenza which is quite a scourge as well after this is over.

Another thing we should all work on, individuals, families and companies is a rainy day fund. Falling over in the first few days is just not good enough.

Spoke to a rental company that has 800 rentals . 600 rented to low income workers. Whose going to give first? There's going to be a few landlords shitting themselves.

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