QV says average dwelling values in Auckland fell last month, but rose in most other parts of the country

QV says average dwelling values in Auckland fell last month, but rose in most other parts of the country

Average residential property values in Auckland dropped for the second month in row in February but increased in most other parts of the country, according to Quotable Value.

QV said the average value of Auckland homes was $925,656 in February, down from $928,921 in January and $933,264 in December. The Auckland market has increased 17.8% year-on-year, but dropped 0.7% over the last three months.

The slide in Auckland values was widespread, with average dwelling values declining in the North Shore, Waitakere, the Central Isthmus, Manukau and Papakura.

The only places to go against the trend were the two districts at Auckland's northern and southern boundaries, with Rodney and Franklin both posting increases in their average valuations.

Valuations also continued to rise in other main centres, with the average dwelling value in Wellington increasing from $482,716 in January to $485,424 in February (up 6.1% for the year) while average values in Christchurch increased from $484,118 in in January to $485,014 (up 2.5% for the year) over the same period.

Property values have also been rising strongly in Hamilton, where they increased from $447,921 in January to $455,966 in February (up 22% for the year) and in Tauranga, where they increased from $557,313 in January to $564,547 in February (up 22.3% for the year).

Double digit growth in average dwelling values in the year to February also occurred in Whangarei (14.6%), Hauraki (12%), Matamata/Piako (10.7%), Waipa (14.2%), Western BoP (13.4%), Rotorua (10.2%), Opotiki (11.7%), Central Hawkes Bay (10.5%), Stratford (10.5%), Central Otago (11%) and Queenstown-Lakes (13.7%).

The average value of all homes throughout the country was $556,306 in February, up 11.6% compared to a year earlier.

The only places to post annual declines in average values were the Buller (-6.2%) and Grey (-10.2%) districts on the West Coast.

To see the average dwelling values for all parts of the country and how much they have changed in the 12 months to February, click on the link below:.

FileQV House Price Index _29FEB2016-55ead1919a98cfac8797c1577e9661adbabe7596.xlsx

 

QV house price index

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Source: QV
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115 Comments

Unpossible!

Down a whopping point zero seven percent... So the collapse begins... Rolling eyes!
Good grief! Maybe the froth in the regions will start spilling over into Auckland...

gees that 55% LVR just reduced, all ok as long as you are cash flow positive wont matter, but if cash flow negative oops we have a problem

It's only really a problem if you struggle to meet payments. However, the animal spirits get tamed quickly in this type of environment. Part of the equation in the buying mania, has been Fear Of Missing Out, where's the rush now?

For real kiwis that is probably many months worth of savings. Insignificant in the bigger picture but worth a small celebration.

Point zero one percent in my area. I'm sure that's what they refer to as statistically insignificant.

I look forward to your comments when the REINZ put out their figures next week. They are considered the most accurate and indicate a 8.2 per cent drop October 15 to January 2016. Not an insignificant drop.

interesting when you compare to increase in debt issued, looks like the focus for investors has moved away from auckland.

14
up

QV stats are taken from settlement dates, not sale dates. Therefore these numbers are a few months behind. It seems probable Auckland prices have fallen further and for longer than 2 months.

Very good point "Triple", QV is a lagging indicator by about 2 months, Auckland prices have gone down about 8% in the last 3 months

Are REINZ figures more up to date?
They would suggest much larger drops are coming in the QV figures over the next couple of months.
http://www.interest.co.nz/property/79956/downturn-hits-auckland-housing-...

Yes, REINZ stats are taken from the date of sale.

Chinese money laundering/speculation stopped...and tax reduction debt junkies with a side capital gain tax avoiding speculation, (opps I mean property investors) locked out...

No surprises really.

I'll add that FHB's are also locked out, so there is not a lot of genuine demand. We are left with greater fools, and as we all know 'a fool and his money, are soon parted.'

Yippeee. Rates will come down...

No they will not

The New Mayor can win on that promise ?

Mandalay conveniently overlooks the January strata index data from the REINZ which showed a 8.2 percent fall in Auckland prices since October 2015. People in the industry I am talking to say the market slipped more in February and the momentum down is increasing in pace. Ten percent on a million is significant.

Ex Agent, you have conveniently forgotten that since you and most other property bears first started predicting the collapse of the Auckland property market, prices in some areas have almost doubled. Our biggest buyers from up north are going to be back soon. The Chinese shadow banking system is bigger than ever and properly prices have surged in China, up as high as 50%.
They will be back soon and the coolest thing for them is our government will give them residencey when they do and shelter from any fallout over there.

China's Shadow Banking Evolves to Dodge Crackdown
http://bloom.bg/1R1rFYH
And China's realestate frenzy is back http://www.bloomberg.com/news/articles/2016-03-02/china-s-real-estate-fr...

Enjoy the read and the linked articles and I bid you good day Sir.

good article jump from one bubble to another because that's what every else is doing.
you are right in this government being complicit in allowing it to happen here and not protect their local citizens

Although the underlying trend for AKL is almost certainly down we are expecting the next publication of the median price to be up due to seasonal increase in higher end property transactions.

The median is irrelevant Penguin. The strata index is more accurate as it allows for any weighting to the high end.

Any one else get the feeling that we might be approaching the 'tipping point'?

I think we passed that, things have 'tipped'. The approach was pre xmas.

Sum Ting is Wong

See I told you it would happen!! You can't have 40% of the investor market disappear over night (Well over October) and not expect it to have any impact on the AKL market. Which of course will gradually affect the rest of NZ over time. I still think that you're going to see a very significant drop over the next few months.

I'm thinking that volume will drop, and property will be withdrawn as people chose to 'wait it out'. The main sellers will be those looking to cash out of Auckland. Mainly retiring Boomers who want to spend that money tied up in their house. Speculators cannot afford to sell at a loss, and I figure it costs about 5% to own an Auckland investment property (if bought at todays prices) so already the timeframe for selling at a profit is shrinking. Anyone who bought in the last 6 months is going to be very reluctant to sell, if they believe things will recover eventually. I think most investors will keep doing their best to keep those properties. It's a sunk cost, and they can't walk away from it. They'll keep pumping money into a dumbass investment, because they really want things to always go up in value.

Thinking of buying a place in either Hamilton or Tauranga but was hoping to buy in a correction of price.I've been waiting for over a year now.With the impeding correction of Auckland prices does anyone think it will stop Hamilton and Tauranga prices from their march upwards?Many thanks!!!

Property. only. ever. goes. up.

the problem you have is auckland investors were pushed out of auckland as they now need 30% LVR so they have headed to tauranga and hamilton and are pushing your prices up.

While prices have increased in many areas - and people fear the contagion of the Auckland property boom to other areas - the question is I wonder how long the boom will last in the provinces - I doubt it will be as long or as far as the Auckland property boom as the fundamentals still come down to people renting a house - is there the demand.......

fundamentals? How about almost every renter in most provinces can own the house they are renting for less than their rental payments (at current interest rates of mid 4%).

And almost eveyone of these renters will have kiwisaver with 20-30k in, enough for 10% dep to buy up to 300k (up to 350k price cap) in most of these regions?

You have many times more potential house buyers in the regions than there ever will be again in Auckland (unless prices in auckland fall 50%). No one renting in auckland can own the home they are renting for less than their rent, or pull out their 30k kiwisaver and buy a 3 bedder on full section.

On all these measures the regions could potentially see gains of the same or even greater size to auckland as the catch up enters full swing. I've warned of this for months. Hope people have positioned their money well.

I see on the report that home prices in the Far North are still over 16% below their 2007 peak so little wonder that folk are taking advantage of the price differential to get a lifestyle in paradise.
Speaking to an old friend on the weekend, her two daughters (with partners and children) have both given up on Auckland and are moving to Whangarei and Masterton. Good jobs and the chance to own their own homes without impoverishing themselves for decades. Good for them.
Only anecdotal but there seems to be some resentment/fear/dissatisfaction from some recent Auckland refugees at the racial changes occurring in that once fair city. Of course few will admit to that publicly.

A bit off topic but we were in the Hauraki gulf recently on our boat and have to give credit for the state of that wonderful harbour. No rubbish to speak of, good water quality and healthy marine life with snapper and kingfish swimming around the boat in the anchorages. Hard to believe there's all those people living around there. Special! I do hope they can keep it that way. At the 2% growth there would be 3 million in 35 years. Do they really need or want that?

Also as prices and as a result LVRs are squeezed in Auckland, investors are going to increasingly go to the provinces where they only need an LVR of 20%.

But is there the demand for the rentals....

Lots of demand in my town for rentals, with rents going up. Houses selling very quickly with massive turnouts at open homes.

Which is why the minimum wage had to increase, just to pay the rent to keep the ponzi going.

I thought the increased tax on cigarettes was to discourage smoking so that money could be used on rent.

And where is your town....

Rotorua

That's fine but will it last ..... and does it reflect what is happening elsewhere

Time will tell.

Palmy exactly the same last couple of months, perhaps lagging rotorua Hamilton etc but next in line if trend is north to south, t relative value has seen investors into the pn market and first home buyers who have been sitting on hands and building up kiwisaver for last decade getting a rude awakening. Tony Alexander of bnz has mentioned 20% yoy growth for cities like pn and after a weekend at open homes their I definately agree.

If prices go up 50-80% in these secondary cities it will be due to kiwisaver and low interest rate fuelled first home buyers fighting over the extremely limited stock (in pn anyway)

The move South is well underway, in the past year the number of houses for sale in Rotorua has dropped on Trade me from well over 1,000 to 430 now, similar drop in properties for rent as well. I am under the understanding that PN is seeing a similar picture.

P.n had 700 for sale in 2011 .. now 160. For population of 85k and growing it won't take much before multiple offers translate into big upward price moves

But it still comes down to demand - is there the demand for rentals - from your statement there can only be demand from the less well off - read poor , those who can't scrape together the deposit for a house. Are there the jobs for these Auckland housing "refugees" in the regions - in some occupations - yes, but others there just aren't the jobs and salary's.

I have seen and heard of quite demand for a range of properties to rent. There are jobs that are higher paid but in specialist fields, which people come too take up and need a home. There is also a growth in building such as new business centre, probation offices (I don't know what else is housed there, but its a big premises), Redevelopment of care facilities, a number of large hotels under construction or refurbishment. So yes the regions do offer opportunities.

Narrabeen Boy. I think Hamilton and Tauranga have a couple of years to run. Look at previous cycles and you'll get a good idea of how it will probably play out. Not sure we'll see 20% gains yoy but I don't think prices will be any lower than they are today. These places are bargains when you're used to the Auckland market.

A 0.7% fall is nothing in the context of 20-30% annual increases for the last 5-10 years.

The chinese money launderers will figure out a way to start buying again and price rises will resume.

But house prices jump up and down around the long term mean don't they? Overseas money pushing them up steeply last year and now easing back to the purchasing capabilities of residents. China has slowed resulting in slipping property prices around the world in cities with huge demand vs supply. Why should Auckland prices rise steeply again? Explain. Money launderers getting round the system doesn't sound like a solid factor to base your hopes on.

China is getting into more and more trouble financially, what happens if they don't start buying again at all?
What if they need to sell their Auckland houses quickly to prop up investments at home?

If China really falls over it could seriously hammer the Auckland market, and also depress dairy prices even further - a perfect storm for NZ.

I don't think the Chinese will sell - they see the property as a store of wealth - not necessarily an investment - there is a difference. I also wonder if the buyers in different markets - London, Vancouver, Sydney and Auckland - reflect different buyer's wealth in their homeland i.e. the really wealthy buy in London , the not so wealthy Sydney and the budget wealthy in Auckland.

You must be joking. Average AKL price would be $2million or more if 20 to 30 per cent over 10 years. 8 percent since October is official with REINZ and they are the most up to date and accurate using strata indexing.

Ummm are you from Venus?? So many streets in Auckland already have $2m + average value. If you choose to ignore it you're a fool.

Can you not see I was referring to all of Auckland not just Parnell and its counterparts.

North Shore City from the qv site going back 5 years - looks like 12.68% per year
$1,079,445
$910,335
$820,155
$713,400
$646,760

another 5 years would see your house roughly 2.1 million at current rate of growth. Im not sure where people are getting their 20% from.

measure that against wage growth and income to debt and NZ has a problem
http://www.interest.co.nz/property/home-loan-affordability

Take a $350k mortgage x 9% = $31,500
Take a $700k mortgage x 4.5% = $31,500

The measure is not always against wage growth.

Interest only. At some point you have to pay back the extra $350,000 too, while crossing your fingers that interest rates stay near historic lows.

the problem with that calculation you need GC to inflate the debt away, which will be a problem when a future government brings in a GC tax

"Im not sure where people are getting their 20% from."

Wouldn't that be 'assuming' they are/were NZ citizens with NZ jobs?. Is this not the data everyone (with vested interests) seems reluctant to make public?

property spruikers tend to exaggerate increases in values! Nature of the beast.

Anyone know how that big B+T Wed AKL auction is going? Is it the usual "spot the Kiwi" game?

Even in the favourites; Hong Kong, Singapore, Sydney and Melbourne, prices are going south.. it might be just the beginning for Auckland.

The door is now firmly shut for any more price increases for Awklund in 2016...... the best case scenario is that prices sit where they are now .....but as I have always said, with the great NZ property investment "model"....... "It's a losers game, if there ain't no capital gain"

Went to Barfoots auction today.
Lots of people but bidding somewhat lackluster and prices so-so
Many Asians but few of them were bidders.
Overall auctioneers had to drag bids out of the crowd.
Last year bidding was more energetic.
This time more serious but sales were made, nevertheless.

I noticed the same thing, I also had a nosy at an auction in the Herne Bay avenues, not a single bid. It's been along time since I have seen that happen there.

Thanks BD - did you think any of the non bidders were perhaps fox hunters? Look for the obvious shades, standing in the corner or back of the room with ear devices and comms to fellow spooks in the room.
http://m.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11588791

Which session were you at BigDaddy - appeared to me that Chinese buyers were in the majority at the morning session and perhaps sellers set their reserves a bit above market but conceded mid auction and lowered their sights slightly to get a sale through. Despite that the average price in the morning session was $1,416,381 and median $1,300,000 - pretty strong figures!

Another head wind for chinese investors, is that their currency has been weakening in the last few months so our houses have got about 10% more expensive in their terms since September.
The Pound, Euro, Canadian dollar and Australian dollar have all done the same thing, and they are the countries most represented in foreign ownership in NZ.

things are not as rosy in china as they make out

http://www.cnbc.com/2016/03/01/moodys-lowers-outlook-on-chinas-credit-ra...

If it ain't happening in Vancouver, it ain't going to happen here!
Canada properties 'dangerously' unaffordable: RBC

Booming real estate markets in Vancouver and Toronto have pushed housing prices to "dangerously" unaffordable levels, according to RBC.

Read more: http://www.cnbc.com/id/103432018

Sounds like all good stuff to me. Auckland prices stabilising (yes some who bought very recently will be nervous). We can't have double digit growth endlessly without disaster. Prices around the country catching up as per previous cycles. The Governor must be happy about these figures!

Now we just need wages to rise and FHB'ers may have a chance at a home in Auckland!

not likely to happen with current immigration settings, maybe if the government tighted that up we would have some wage inflation

I was also at the Barfoots auction in Shortland St. It looked like a good turn out in the afternoon. I was only able to stay for a few but all seats were taken and it was quite a battle to get out of the room through those standing at the back. Quite a few houses had sold prior and it was trending about 75% selling when I did leave although I suspect they put the easy sales on first. Certainly looks like quite a healthy market still.

B&T Auctions this week:
Manukau success rate 56%.
City and Bays success rate 62.5%

So reading between the lines the sellers are finally being a bit more realistic in the prices they are looking for.

Funny how quick this article got pulled off Stuff.
Obviously all the real estate firms that advertise with them said it was not in their best interest to have stories about falling house prices.

Yeah I'm shaking in my boots, my house lost a couple of thousand in a month. Probably still better to take a long term outlook, the graph is only going in one direction and its not down.

Carlos - how do you know this?

If we were to take a long term outlook, it would say that all markets eventually return to the mean or back to fundamentals. So the graph can't just 'go in one direction and that is not down'. It is more likely that it is due for a significant correction in the opposite direction. The question is when?

Its only gone in one direction since we got to New Zealand in 1974. Sure its had a few dips but like I said if you take the long term approach the line is only going in one direction. In recent times you didn't have to even take the long term approach, 5 years has been a "Long Time" in the property market. In case anyone has not noticed, they are not making any more land. The spread is outwards and as long as NZ is a safe haven and with the worlds population increasing exponentially now its only going to get harder to buy property. Its going to take a major event to change things and not a nice one at that. My advice is not to wish for a sharp correction, thats just going to screw everyone.

Perhaps it is deserved, as a reward for the greed and mismanagement.

Perhaps it is deserved

I have noticed a sort of extreme, doomsday, religious-like, moralistic tone displayed by many of the commenters here.

What do you think greed and mismanagement should be rewarded with?

You are not accounting for all the non-property owners, current and future generations, who are on the wrong side of your trade and are getting properly screwed by those lucky enough to have landed on the other side. Inflating property value is a social evil, not some god-given right and benefit of Kiwi lore.

I have noticed a sort of extreme, irrational, religous-like, infatuation towards property displayed by many of the 'landlords' and 'investors' here (for a number of years)

Well, we have been blessed.

And don't you all just love to let people know it

try propertytalk.com you will see the same vibes from wise old investors who talk about peaks and troughs, cashflow and making sure you can handle and take advantage of a downturn, and the young bulls who have been in since after 2009 who only talk the market up and up and only know how to leverage and borrow
it is interesting when a wise old knarley investor calls out the BS being spouted by a young bull,

Life's great in landlord land I_O.

they are not making any more land

Well actually there's plenty of land in NZ. The landmass is larger than Britain and with 1/20th the population. There are only city limits and the crappy undesirable nature of the regions, which are just transient details in the long term.

Property values over the long term in colonial countries where expansion is possible tends to trend flat. Ref USA Case-Shiller long term data.

My advice is not to wish for a sharp correction, thats just going to screw everyone.

Actually everyone who's not recently become a property speculator will benefit radically, as will their children. The opposite is true. We had all better hope for a sharp correction.

You'll be fine either way Carlos67 if you've got no debt ??..... :)

No debt here, paid of the mortgage in full back in June 2014.

No just people in the real world who acknowledge that markets are unpredictable. That all markets have peaks and troughs. That all markets work on greed and fear. That fear is creeping into the Auckland housing market hence more listings and more people willing to negotiate to get a sale.

The only fear I am seeing on the Auckland isthmus is the fear that if you sell your house you won't be able to buy another similar one for the same price. That's why so few people are selling.
Honestly, I am not being facetious, this is a real worry here.

The people I talk to have sold and know they will buy back cheaper. Those who have never owned a house are holding off as they know they will be borrowing less when they buy. Their fear is borrowing more than they need to if they go in too early. The people you are talking to are not facing reality like you. That the market is already down 8.2 per cent since last October and dropping and the momentum down will accelerate. As more and more people see the valuations in Auckland drop more houses will hit the market and valuations will drop more. That is how markets work. Greed prevailed but now fear is taking over.

In central Auckland? Do you know anyone who has sold and bought a better or equal house cheaper in the same area?

You talk as if Central Auckland is so sacrosanct it will never fall in value. The reality is it already has and will continue to. I appreciate some big prices will always be paid for trophy homes but that does not mean they are worth those prices. Some people just have to have a certain home and money is not a problem. In tough markets the higher priced houses drop more. And that is what is currently happening. It is tough to sell a house in Auckland and it will get tougher. Get used to it. As the REINZ said last month people want to sell and buy but they cannot sell.

My base is Central Auckland so it is what I know best. Very few houses for sale around me. What was for sale recently went to early auction. No problem finding tenants. I went to Barfoot's auction on Wednesday and things looked hot and lively, probably 75% sale rate if you count the sold priors. Houses are easy to sell here.
People buying on condition will be a sign but I'm not seeing it.

What is the biggest threat to the Auckland property market? a change of government?

External events outside of NZ.

Tim - Rephrase your question - what is the biggest threat to Auckland? Answer is the property market.

The fools have let it get to TBTF

Which is why the minimum wage had to increase, just to pay the rent to keep the ponzi going. -Andrewj

I don't understand why I keep seeing the term ponzi thrown around here when it comes to the property market. When I rented a unit 15 years ago I paid $250 a week and now the same place is $500 a week. The unit is worth three times as much now but mortgage interest is much less so it doesn't seem crazy. My salary has more than doubled in that time. My household income tripled.

You can buy a place in Papakura for 450k and rent it out for $400 a week or more making it cash flow neutral. A nice place in a nice area is always going to be worth substantially more than what an investor would pay just for rent yields. For as long as I can remember you couldn't buy cash-flow positive places easily, you always needed to top it up by 50-100K . The figures still look the same. The fundamentals are the same. Wages increasing woulld really drive this along. Many businesses operate at a loss and only make money when they sell. Some intend to lose for the first few years and then make money later after getting established.

The other factor is rent yield is low but so is bank deposit yield. Wouldn't it be nice to have four rentals bringing in a passive income? You wouldn't need to work again. Doesn't this regulate the market, making it definitely not a ponzi? Someone can come in from China and buy five houses, rent out four and not need a job. Why does the government stop this and not make it a valid business proposition? Because it is too easy and doesn't employ people. It could mean the Chinese buying every rental, but don't you see it is kinda of an attractive proposition? So safe and so easy to make passive income for someone with 2-3 million and modest taste. There is a reason we need to guard against this happening.

Anyway in summary how is it a ponzi if rent can cover mortgage for Landlords in some areas and people will pay more in good areas than an investor would to secure a family home and get house security?
Rent yields place a backstop on a price plummet. A ponzi scheme has no such backstop.

But auck rental yields are gross 3-4%, net 2%, less than money in bank. Add flat or falling prices and the back stop wouldnt kick in until net yields bounce back to 4-5%.

400 wk for 450k house, after rates and insurance is still solidly negative even at 4.5% interest.

Try 380-420 a week for a 4 bedder in pn (and thats renting to a family not students, 500+ a week rent for 4 rooms to students) if you want someting putting money in your pocket (can be found for 250-300k depending on area).

Search for yield likely to see this anomoly short lived however (i.e prices will rise until yields fall to 4.5% matching cost of money) as the world accepts a lower for longer interest rate environment.

Bank yields look to be getting lower in the long term though. You should get better than 4.5% interest and there are tax breaks. It's not great I know but its not spectacularly bad. The idea is to hold in there until things start to improve with rent going up, interest going down, wages going up. However you need to choose wisely as well with view to improving capital gain. Can a two bedroom be a three bedroom? Can you install a sleepout? Is it an up and coming area? It's not supposed to be too easy.
Bank yield on 450k at 4% for 5 years would be about 2.8% after tax? No chance of CG either.
Also bank deposits, how boring is that? Also that much money in the bank is hypothetical for most. Many are in the rental game for a long time and have built equity there to continue playing.

What are your thoughts about using a deposit or even retained earnings?

I respect what you are saying ZS but it's the whole economy that is being susidised by globalist, banker friendly policies that's keeping it all going. If labour and the greens are voted in at the next election what can they do? Keep policies going that favour foreigners over New Zealanders? They will have to, or the whole thing could collapse. This why Donald Trump is scaring the establishment in the US. He's the only one saying anything different. The rest are terrified of bursting the bubble. We have let the bankers take over the world.

Indeed

They are terrified of losing their hold on power that delivers the privilege they have long enjoyed.

Watch the republican financial elites bankroll the political elites to pay a huge sling under the table to make it worthwhile for the number 3 and number 4 republican candidates to eat their egos and pull out and leave only one of their chosen candidates up against Trump

The 3 candidates are splitting the republican vote giving Trump the lead

the people that can not see bubbles are the worry, and the chinese are at the forefront of creating many of them whether it be stockpiling of commodities, piling into their sharemarket or overseas property markets. once they get a scare they will run for the hills on mass.
but that's fine because JK said they are not a problem in the Auckland housing market "yeah right"

http://www.cnbc.com/2016/03/03/i-see-bubbles-bursting-everywhere-top-aca...

watched all those this morning too.. thats why im fixing short at 4% (knowing in 1 years time rates likely same or lower) and buying high yielding properties in cities with a good uni and hospital as the search for yield makes 7% yielding property thats still at 2006-2007 price levels look like a screaming buy

Vikram Mansharamani is looking for bubbles and is selling a book about it.

Property is not a Ponzi scheme sorry. What you have however is people kicking themselves in the ass for not buying a house 5 to 10 years ago when they could have and still telling everyone its a Ponzi. Really its a simple decision, buy a house or go on renting and thus face the possibility of not having the option to retire and keep working til the day you die. Don't get all green with Envy over the people that took the punt and purchased multiple houses and are now worth millions, thats life.

Carlos do you feel sorry for those just entering the work force in Auckland who will be saving to create a deposit on their first home. What about those still at school or at university. Not that many are worth millions. They owe millions of course and 10 per cent has just come off the top in Auckland and the pace down is increasing. Talking to those in the industry listings are growing as investors and speculators see their equity diminishing more each month since October 2015. Markets are ruled by fear and greed. Fear is now the main factor especially the idiots who bought last year prior to October.

Your choice if you want to go to University and come out with a bill of $100K. You know what your going to owe when you come out. I would suggest that 80% of University degrees are a waste of time so choose wisely and get qualified in something that leads to direct employment paying good money. Perhaps the parents of those kids will have to downsize early and help them into a home. By the way I have yet to meet an "Idiot" who owns their own home.

Their equity is down 10% already and diminishing by the month Carlos. If they had had the patience they could be buying now and borrowing 10% less. I would not advise them to even buy now as the market in Auckland has some distance to go downwards. My broker always says you only know it has turned around when you see it go up for a couple of months or so or in the world of shares a couple of sessions. Last year it was obvious the market in Auckland was peaking as it was irrational. The idiots who bought then only have themselves to blame. Some of them will have their loans called up in due course when the banks get worried about their lack of equity or rather their negative equity.

That's lucky - you might get to meet a few over the coming months/years around the Auckland area. How fortunate.