ANZ Property Focus Report says housing market is weak, revises house price expectations down

Don't make a bigger fool of yourself.. you already have made a fool of yourself in the past.... prove that I claimed a 10% rate by December.. and rates are still high..you  🎑  / bigger 🤡 

Are you guessing?

Or have you done the math? If so, show it. 

That's how the banks operate.

Were the RBNZ to hold the OCR at 5.5% until the end of 2025, the total length of elevated rates would be over 18 months - much longer than they were ever required to in recent times - and the damage would be severe

I don't have an opinion on what you said, just leaving a link to the data if anyone wants to see how the OCR evolved since its March 1999 introduction

https://www.rbnz.govt.nz/monetary-policy/monetary-policy-decisions

I'm on the fence still, as we are around the historical average for the OCR and since they've overshot the hikes due to the delay in taking action, you may be right and they may drop and drop again and overshoot the drop once again, or they may only drop a couple of times and let it as is. The market is only influenced so much by the OCR as we have now seen. The swap rates say it all.

@homerodent

on what basis and why do you feel the need to repeatedly make these "predictions"? Mostly proven to be incorrect.

You should change your non-de plume to "I reckon" It would better suit 😊

The inverted yield curve is unwinding, recession is looming (Check out Shanghai and China generally) people are angry globally (check out protests across Europe, S America) angry people blame those they perceive as responsible - history repeats. We are probably in a the gap period between an event and its consequences plus Christmas effect. The RBNZ will continue is unbroken track record of being wrong about everything - too little too late or too much too soon Orr will new Govt suggest he resigns to spend more time with family - hope.

True HM, but the final para is bang on…

Yes correct, you are always better of with lower prices and higher interest rates because you can pay the debt down and  your higher interest costs are inflated away with the corresponding income increases.

And then of course a change in Govt. Policy gave capital growth as well.

BUT the worst place to be is high prices with high interest rates.

Where we are now.

Values and income are also a function of each other. Values became way out of whack due to quantitive easing 😊

100K compared to 1 mill. I would take high interest any day at 100K. I was a little whipper snapper straight out of school working at NZ Steel on $45K. Crates were $10, no traffic in Auckland, houses less than 100K. Times were great. But now a six pack of beers is $20 bucks that's cans or small bottle and house prices are costing $1000 bucks a week, for new home buyers. Its like Governments both Labour and National got together and said how do we make life more miserable for people, lets increase immigration, increase inflation and house prices and see how lucky everyone feels. Maybe if we push hard enough, we can make people so poor, get crime so high and homeless so high, we can have people employing security and have gated communities.

Then you will get people who were born at the right time, pointing fingers at people and tell them they need to work harder and stop buying avocado.

Which is fine, except that rates can stay higher and for longer than many people can keep their heads above water. So by the time rates come down they'll have drowned.

I wonder if the Turkish agree...

I don’t see why it has to come down? We are back to longer term averages, and the baby boomer generation is retiring and starting to use their capital. They may demand a higher cost of capital which will have a larger effect on interest rates than what us mortgage holders want…

The real concern for me the underperformance of GDP as the velocity of all this printed money accelerates. 

Something either has to change or things will start to break real fast... 

Couple of points:

re ... "Historically rates are not high"

In the NZ context, and if one goes back over 50 years, when non-economist Ministers of Finance controlled our monetary system, this is true. It is also true that these rates were consistently higher than other countries we compare ourselves too. And this is simply because lender didn't trust the stability of our finaccial system. And Muldoon proved them right.

Then enter the Reserve Bank of New Zealand Act 1989. Suddenly there was a promise of stability for lenders. Over time lender grew to trust the RBNZ and lent at lower rates. Our rates have been trending down ever since.

Ergo, using "historical rates" or "long run averages" paints a statistically unsound picture of the current state.

I use "recent times", being from about 2020 while removing one-off events like the lead up to the GFC where the RBNZ did exceptionally well to recognize the situation prior to the GFC and quashed too much dangerous borrowing (and foolish economic activity). When the GFC hit, the RBNZ had ammunition aplenty and responded appropriately.

re ... " rates at this level are the way it’s going to stay New Zealand just follows the narrative set by other countries."

You've noticed that rates on long bonds are falling both here and in many major markets, right? Nobody I know of in economic cycles in the USA or Australia is predicting anything but return to normality as far as rates are concerned. And, as I said above, my normality is quite different to yours.

 the simple life is actually pretty sweet. Consumerism is a waste of life.

Amen brother. Those who can grow a good chunk of food, catch fish and hunt plus access the areas to do so readily are the winners in so many ways. Perhaps not in monetary terms, but in lifestyle, health and most importantly, fulfilment.

Vested financial self interests.

Refer to the linked video at the 33 second mark



"what if people say that rates are too high and prices are dropping?"



https://x.com/ManyBeenRinsed/status/1729136851825676345?s=20

Are you saying TA is not a respected independent commentator? The man conducts a poll of real estate agents and uses that to divine the housing market. Can’t see what’s wrong with that 

You could also add we shut down the country, causing an enormous amount of social problems, disrupted schooling, left folks to die alone without family and borrowed billions to save them from covid, when the death rates for those under 70 were absolutely negligible.

Iceman, like it or not, commentators on here have probably saved many FHB’s multiple 6 figures since late 2021 and are continuing their great work rescuing what may have been a life debt laden servitude.

This will only add to their savings over the coming year(s).

Granted the environment we’re in, it’s never been easier to see the freight train hurtling towards us, but your last ditch efforts to salvage the unwitting doesn’t go unnoticed.

Nevertheless, it’s amusing to watch you try.

Big thanks to:

Brock Landers

Miguel

IT Guy

RP

Rastus

Dumbthoughts 

Jfoe 

J.C

HM

and many others!

If the bank has tested people at 5.5%, put them on a 12 month fix, only to have the customer refix at rates over 6%, then it sounds like the bank may have failed to exercise care, diligence and skill of a responsible lender as per the CCCFA. 

Sure, it's standard bank practice to test xx% above the OCR/carded rates, the only logical reason is to increase the number of dollars lent out.  Since all borrowers should be subject to the same benchmark, what benefit to a borrower does a 5.5% vs 9.5% test rate provide?  Why not test borrowers at 2.5%?

People are also free to chose to pay more for a quality fridge, or to do their research on the cheaper brands.  

Yet if people choose to buy a cheap and nasty fridge, and it craps out in 13 months then the retailer is still on the hook.  

The difference is we have a consumer guarantees act that prevents the customer from being out of pocket, the same doesn't apply to mortgage lending unfortunately.  Banks will take this to their advantage.

Another 200,000 coming here on work permits expecting to gracefully land jobs in a contracting job market. Unemployed New Zealanders won't take issue with being drowned out by other applicants - no, not at all.

Reality check - Immigration will head down soon enough. 

No they won't.

NPS-UD, MDRS, updated Unitary plans favoring high densities, etc. Supply will continue increase as it has done since 2016 in Auckland with their new Unitary plan.

If you doubt it ... Be the first to prove me wrong.

Also, don't we have some kind of obligation to support our own young people to have families instead of just mindlessly importing more bodies? We have friends who are now not going to start a family because they need 2x big incomes to pay their massive mortgages (they bought in 2021 at the peak). The reason they bought then, because they wanted the stability to start a family. It's pretty tragic really.

It’s actually a morbid form of self destruction.

Previous generations in bygone years came to NZ, propagated in this fertile land. Built communities and families. Then as time has gone on, through lack of foresight and intellect, they have unintentionally, implemented policy, rules, environments where their own offspring will not and can not breed in the toxic habitat that has been created. They therefore have imported foreign species that are well adapt to this habitat and will successfully propagate. Ultimately out-breeding and displacing the existing species.

Whilst noting the somewhat racial overtones to this, there are legitimate questions around scale of immigration now being asked in many countries. NZ doesn’t have the culture to have difficult conversations or debate these intelligently sadly.

One point to consider, many kiwis have their offspring overseas and return to Nz. 2 of my neighbours had kids overseas before returning home - those 5 kids are kiwi citizens and just as entitled to be here as you