Archive for December, 2008
In 6 hours time we will be saying goodbye to 2008 and for many of us sluring in 2009.
Thankyou everyone who has read and contributed to this blog, I have actually really enjoyed the contact
thats been made through this.
My partner and I want to wish you all a good time tonight and hope all the best for you in 2009.
If your travelling in the next few days as we have and will be, please keep safe. There is alot of people on the roads.
December 31 2008 | Uncategorized | 4 Comments »
What’s in store for 2009.
Seems like everyone is giving their predictions for 2009. It also seems everyone has a different opinion. If you go down the street and ask someone what’s in store for 2009 every single person will give you a different response. Some people are positive, some people are negative. Some have very strong views but one thing I have noticed is there is not many that don’t care. This varied response is actually in my view what’s going to happen in 2009. It’s going to be varied and unpredictable in the whole.
Let’s look at 2008 and what’s been. I am not going to get into this too much because we all know what’s happened. The global credit crunch has hit and it has hit us hard. We started the year on the peak. It was the peak of almost every single market, not just the real estate market. The dollar was high, the stock market was buoyant, petrol prices were well over $2 a litre, house prices had just hit their peak, but everyone knew that that was the peak by this time. We have been in a year of constant downward trends. Consumer and business confidence has been at an all time low with sales volume and capital have steadily been lower and lower and unemployment levels this year have risen 2%. I know three of my friends who lost their jobs in the last week because of less business turn over.
The global credit crunch started by dodgy subprime loans in the states has had a ripple effect around the world and instantly devalued the price of all the assets we use to trade on. The stock market plummeted, oil prices have fallen 138% this year, our New Zealand dollar went into a free fall loosing almost 35c of the American in less than 2 months. New Zealand’s housing market went into dire straits with sales volume bellying out to levels not seen since 1992 (16 years ago) with only approx 55,000 sales being transacted in 2008. Real Estate prices have fallen by up to 10% – 15%in some areas already from their peak in late 07.
The world reserve banks have slashed the official cash rates all around the world. In the states its now the lowest in history at under .2% and in New Zealand it’s almost the lowest level at 5%. Interest rates on houses have come down a considerable amount. But the banks are not going to lend on any risk at the moment with most of them putting their minimum deposit amounts up to 20% on all new loans. So all up it’s been a year of considerable change and a year that has hurt and seen many people become closer to financial hardship.
2009 is not one that will bring pleasure or happiness to many people caught up in this economic downturn. As credit lending gets tighter and banks put on the pressure to repay loans on property that has decreased in value and in some cases decreased to levels below what they owe on the property. Unfortunately this is going to be a reality for some people and there will be more and more forced sales from it. Banks will step in and won’t be accommodating if you’re in a position to not pay them back.
I think in 2009 that the economy will start to bottom out a little. I don’t think we will see the prices of oil drop to much further, or the stock market crash to much further. There will be a lot of fluctuation though that will cause consumer confidence to remain low for a period of time. The New Zealand dollar although risen against the US Dollar in recent weeks will remain around in my opinion the 50c mark and will remain around there. But there is still too many uncertainties to place too much weight on this.
There are still factors I believe in America that could pan out either way. One of the bigger ones is the car industry and the almost total collapse of that. GM and Ford America are part of one of the biggest industries that feed the American economy. This industry is looking at almost completely shutting down. Already workers are taking pay cuts, working less hours just to try and help the companies stay afloat. But the reality is if the government doesn’t bail them out there is going to be a catastrophic meltdown of the economy in America. And it’s not just the car industry that I am talking about. It’s all the suppliers, all the people who service and or repair the cars, the distributers, shipping companies, you name it they will be affected. If the car industry goes under their will be job losses in the millions. They expect there will be more people lose their jobs than people that live in New Zealand. At this time all we know is that the government have given a reprieve till March 09 and we will have to wait till then to see what will happen.
Back to New Zealand what this really means is 2009 will be a year of consolidation for all I think. It will be the time when people who have borrowed on easy credit will need to take a reality check and downsize and live the life they can afford. I think we have in New Zealand seen the huge falls of commodity prices. It’s now a case of waiting and letting that filter though the system. What I think we will see a lot of people tightening up and living more economically. Not because of want but because of having to.
There are things that could happen in 2009 that if did happen will change everything that I have spoken about. The fact of the matter is that the world is on tender hooks in regards to the economy. It’s almost like balancing a car on a pin, it could go any way and we won’t know till it happens. This uncertainty is going to mean though that volumes of sales and consumer spending is going to remain low into 2009.
For the housing market there will be more and more forced sales in the coming year as the pressures of day to day living and the tighter economic conditions start to mean more job losses and less money for families. There is going to be a need for huge cooperation in 2009 between everybody who provides services and products. As sales volumes drop and bottom lines drop costs are going to be cut and this will mean suppliers are going to need to be flexible with their costs just to keep their existing clients. Food costs need to come down as people find it harder to buy for them and their families, and more people start eating less expensive foods. We will all need to help each other. The boom years have been a selfish time when people have made easy money but now for people to get ahead they will need the support of others.
For first time buyers in 2009 you will have to creatively think how you are going to service and in the first place get a loan to purchase your house. Thats if you dont have 20% of savings. Use the help of faily that already have high equity in their homes and ask to borrow some of it. Its a risk for them but it also will make you accountable for your repayments. There are many ways and its just about getting that help and support and it applies not just to housing as well. We could all save so much money if we worked together in some things instead of fighting to get the most as we have selfishly done in the boom times. This is not the time do do this.
For the aggressive investor and purchaser I think there could be some good opportunities coming up in the property market. There are already properties you can buy that are positive cash flow. And if you’re going to sit on them for a number of years until the economic climate stabilizes to normal again you will do well out of them. Although I do think that property prices will fall further as there will be time when wages come into line with property prices and may not stablise during 2009. I base this on the prediction that there will be increased forced sales which will put pressure on normal sellers to meet the market where the forced sales are if they want to achieve a sale. It will come down to sellers if you want to sell your house for a good price you need to display added value for the purchaser against the one down the road for similar money.
It will be tough out there for anyone in the next year but if you can ride it you will be fine. 2009 will be a year along with 2008 for global change. People will come out of this and look differently upon how we treat both money and the world. I think there will be a lot of good come out of next year. It’s just a case of taking the hit now and getting on with life. We have all lost out but we will all reap the benefits when they do come around.
December 26 2008 | Uncategorized | 2 Comments »
In September I wrote a blog post here about the price of crude oil and how it was falling and yet the price of fuel at the pump was not dropping. Since then I have recieved over 200 emails from readers who have all voiced their opinion in this matter and I think they all have a point.
When the cost of crude was going up in record speed the price of fuel also went up at record speeds. The price increases were passed onto the consumer almost instantly. After a while I wrote a letter to the New Zealand Herald and they ran a story which appeared on the front page which went on to say fuel was about 30c more expensive than it was comparatively when the crude oil was at that level. Now crude oil is half what it was then and we were paying 1.89 then.
Crude has more than halved since then and is less than 1 quarter of what it was worth at the peak in July 2007 when it was $146USD. Crude Oil today is $35 USD a barrel. Although our dollar has dropped back you have to look at the figures. In the past two weeks the crude price has dropped almost $15USD and our New Zealand Dollar has gone up almost 5 cents. But we have not seen any movement at the pump price. It has been $1.39 for about 3 weeks now.
I have been following the price of fuel vs crude oil when it was rising and both when it has been falling. A barrel of crude in New Zealand will be $61. This is actually $9 less than it was yesterday due to the rapid drop of crude oil prices. I believe that the price of 91 Octane should be approx .85c per liter and that is taking into consideration our lower New Zealand Dollar. I am sick of us all been taken for a ride on the price of fuel at the pump by these big oil companies. The price is over .50c more than it should be, there is no way you can deny that at all. We are paying too much at the pump.
But is this a sign of times to come as well. Is the price of crude dropping, the speed at how it has dropped and the continuation going to be a reflection of what the houses prices and the economy will be doing in 2009. It makes you think again doesnt it….
December 25 2008 | The Market | No Comments »
Just a quick note to wish everyone a Merry Christmas.
God bless you and keep safe over the holiday season.
Enjoy the time with family and frinds and lets hope Santa brings you some nice gifts.
All the Best for 2009. Deon
December 25 2008 | Uncategorized | No Comments »
I just read an article published on stuff.co.nz and its one that I thiought I need to share with you because of the impact this will be having on the housing market in New Zealand. The article is below:
The exodus of migrants to Australia hit a record in the past year, while tourist numbers from northern Asia are slumping badly because of the global economic slowdown.
Australia’s stronger economy is an increasingly large safety valve for Kiwi workers in tougher times.
In the past 12 months, the number leaving to live or work in Australia would fill Wellington’s Westpac Stadium, with another 800 standing outside.
The net loss to Australia in the past year was 35,300 almost 100 people a day. That is the biggest exodus on record. Previous peaks in migrants came after the 1987 share crash and in the late 1970s.
New Zealand gained 3600 permanent or long-term residents in the past 12 months.
In November alone, 600 more people left New Zealand than arrived. That is a bad sign for an already struggling housing market, with Westpac economists expecting house prices to fall by another 5 per cent next year.
Tourism is also facing a tougher year. The industry employs one in 10 workers in New Zealand and some economists expect the sector to be badly affected by the global recession, cutting into the $1 million an hour that overseas tourists spend here.
Tourist arrivals in November were down 4 per cent on the same month last year. But there was a 46 per cent dive in Japanese tourists for the month. South Korean and Chinese visitor numbers also fell sharply.
Tourism New Zealand chief executive George Hickton said he expected tourism to be down by 6 per cent or so in the peak summer season. “But our concern would be from March, the low season, as bookings are quite light.
“We will have to batten down the hatches to get through a tougher time.”
New Zealand would get some benefit from the big fall in the kiwi dollar, which meant tourists typically spent more while they were in New Zealand. Lower world oil prices would also eventually result in lower air fares.
In November, tourist numbers were down sharply because Japanese parents cancelled school charter flights for 6000 children after the high New Zealand dollar pushed up the cost of thetrip.
But Tourism Industry Association chief executive Tim Cossar said the fall in the dollar meant New Zealand was a good value holiday destination.
Backpacker hostels, holiday parks and motels were so far unaffected by the recession, but bookings “were looking tough” after February, he said.
However, the domestic tourist market was still strong and Australian tourist numbers were holding up.
Source: stuff.co.nz by James Weir
Will this be impacting on our New Zealand Housing Market. There is no doubt in my mind that for the short term it will be. To create a balance in the market there needs to be equal supply and demand. At the moment there is substantially more property on the market than buyers. In my last post this is the classic signs of decline.
I asked my followers on twitter why you think so many people are leaving for over seas and most of them said it was for increased wages. Although the cost of living is higher over in Australia people in this recession time aren’t so much looking at the bottom dollar but the top dollar and this is where we are suffering at the moment.
The effects of this on the Housing market in New Zealand may aid in bringing prices down further but there is no way of telling this. But what it will do is put more stock onto the market and add even more time to how long it takes to sell a property.
December 21 2008 | The Market | 1 Comment »
During the last few years the real estate market was rising all over and we were experiencing a sellers market. The media went wild over the frenzy and everywhere you looked there was someone or something telling you that real estate was HOT HOT HOT! Prices were going through the roof and there was unprecedented growth and people were becoming rich by simply buying and selling houses.
Now the market going through a correction because there was too much growth too fast. In some areas prices and inventory levels are going to decrease. Is that a good thing? Yes, it is. It’s healthy for each market to go through it’s cycle. This ebb and flow is good and allows each market to grow and then collect itself and catch up, and then eventually grow again.
What has happened over the past few years is prices have increased and increased and just keep increasing. But this prolonged spur of growth can’t be sustained forever and there then there comes a point when people are no longer able to pay the prices of the homes. During the boom times people begin to notice how much the neighboring homes are being sold for and they want in on the action. When a market heats up and prices begin to rise quickly everybody starts throwing their homes on the market and the market becomes flooded with property.
Eventually when the demand slows, but people are still wanting to sell for more and more, those home-sellers (who are always the last to accept the end of a growth period) will need to adjust for this and the market can correct itself.
Here below is a wheel with what I call the 4 seasons of any market. I will explain them below.
This boom or growth time is called the expansion. Expansion brings job growth, population growth and a high demand on the infrastructure of an area. Roads need to be built, restaurants open, hospitals expand and prices rise. This in the Real Estate market brings new construction, new sub divisions and more money. Property prices increase and demand for the property on the market increased. This was felt here in New Zealand around the years of 2001 to 2007.
In New Zealand what we experienced in the later parts of 2007 was equilibrium. Equilibrium is when things begin to slow and settle. Prices have reached their limits, or beyond, and this period of time brings high prices and as a natural consequence less businesses move into, or expand in, the area. In this part of the cycle prices usually slow to a steady lever but this time because of the Global Credit Crunch we have seen a very short time in this area and fast movement into the next step in the cycle which is Decline.
Decline occurs as the demand for housing decreases, job growth stops and businesses begin to relocate to save money. During this time, prices become stagnant or even decline as rents and occupancy go down. Usually this decline is merely a slowing of the growth rate, but in markets where the rise was too fast the decline must result in a correction (decline) of prices which is what we have seen during 2008.
The market will then move into absorption. Absorption occurs as the lower prices and occupancy levels fall below the national averages and/or the area becomes attractive again to businesses looking to relocate. Usually in this time incentives are introduced by governments to encourage growth within the community.
I like to think of the market as a natural and living cycle that has laws that it has to follow. The easiest way to explain this is by calling the 4 cycles in the market a season. Just as nature has it’s seasons, real estate markets have a healthy way of transitioning from period to period. Sometimes depending on external factors such as warmer sea temperatures a season could be more violent. In the real estate market the same principle will apply. If there is an unusually high turnover of volume or higher than usual debt in the market this will affect how the next season performs. Experiencing these transitions and understanding them is very important and if your serious on property this will give you a huge leg up and will also help you as a home buyer or seller understand how they work so you can weather out the storms and relax in the warmer and rosier seasons.
December 20 2008 | The Market | 2 Comments »
Christmas is now only one week away. The shops are full, the roads are packed, christmas parties are happening every day and most of us are looking for that all anticipated Christmas holiday period. For many of us work closes up on friday or around this time.
This year will be the first time I have spent Christmas with my family for many years which is going to be awesome. Business and military commitments in previous years have kept me away. Christmas should be a time to be with family and friends and a time to have some R&R. For many of us we go away and enjoy maybe the holiday home or somewhere near the water. Being New Zealand many of us will spend some time on or around the water. So please be safe on or around the water this year.
Where ever you are and what ever you are doing I wish you all the best of Christmas’s. This year I think it is important to at least get some time away with your family. This year has been a hard year in almost every industry. We are seeing massive change and many opportunities at the same time. Next year will be exciting and I look forward to working or talking with some of you at some point.
Take care over this festive season and a big Merry Christmas from me.
Deon Swiggs
December 17 2008 | Uncategorized | 1 Comment »
Its official. Sales volume is the lowest it has been for 16 years 11 months and the market has never been harder to work. Sellers, Buyers and agents… We are all having to adjust, compromise and accept that the days of the boom are well and truly over. And property prices have in fact in some areas come back 10% and some places maybe more. Negativity is so easy to talk about these days when the markets are depressed. Every day we are all hearing about the Credit crisis, banks bailout, tougher lending, house prices and sales fall, car industry crashes, jobs been slashed, and I could go on for a very long time.
These of course are the reality of today but we have to look in hindsight at whats happened prior to bring this about and the fact of the matter is that too many of us are forgetting about is that from 2000 to 2007 there were 7 years where there was the biggest economic growth this world has ever seen. This created jobs in huge amounts businesses were making money without huge expense and effort, many people bought property and in 4 years sold it for double what they paid for it enabling them to buy bigger and better homes and allowing others to get into the market easily at the time. We were all living relatively good lifestyles and many of us were probably living at a level above where we deserved to be.
Reality has hit home but is this a reason to be scared, freak out and stop doing the economic activities we used to do? NO! It’s a time to consolidate definitely and a time to work smarter and stop being lazy. Do you want to be left behind and watch the ones who take action now prosper in ten years time. Are you going to be the one who says, dam I wish I took action when there was time. I sure hope not. There is no reason to worry, it’s time to start opening your eyes up and see whats happening around you. We have seen a major shift in the market place one which few people really expected, homes and property continue to be bought and sold at new levels every day of the year. There are always people who need to sell, and people who need to buy, and so long as there are these 2 people in the market, property will sell. It just won’t sell at prices that where around in 2007.
Housing prices today right now are in many places at a level that has made homes right across the board more affordable. And in my view the key to selling your property in 2009 will be in the ability to show that your home has the best value for money on the market, and attract the right buyers to it, and when you’re buying and selling on the same market you aren’t gaining or losing any of that market change. Don’t be afraid to step up to the mark and make a move.
There are some very good buys out there now. We don’t know if there will be better buys to come. All we can do is work with what we have now, and there are plenty of people wanting to sell. Plenty of people are wanting to buy. Enquiry on this blog has doubled in the past three weeks and the search terms are mostly about how to find a good buy. If you want to know where a good buy is, talk to a trusted real estate agent. In this market as a seller they are going to be your best help and also for a seller a real estate agent will be helpful in so many ways. Its bridging that expectation gap which the agents do in order to meet everybody’s needs which is so important.
I have a very large social network online and am in constant contact with them. Today I conducted an experiment. On Twitter I asked a simple question. ‘What are your concerns going into 2009?’ 70% of the response I received was positive and about the opportunities that they see coming into play now. The other 30% were concerned about the financial pressures of life. Which person do you think is going to take action and prosper from it.
Take action. Don’t sit by and let things happen before you. If you have a problem, for example you need a job transfer somewhere and you need to sell the house, take action and sell it. Maybe consider a part swap of a possession somewhere else or something else to sweeten the deal to the buyer. These things will work and you will see the results. I believe the time of opportunity is near. But the opportunity is lost if your too late. Be in. Don’t be scared and think of the long term goal. If your purchasing a home today, tomorrow or in the near future good luck. There are some great buys out there for you to snap up and they arent a trick. This is for real. People lived lives a step above what they earnt and now are having to take the hit. This is the opportunities for you.
December 16 2008 | Buyers and Sellers and The Market | No Comments »
The Christchurch Real Estate Market was alive and well today. Harcourts Grenadier held 18 Auctions today. After all were conducted the results were quite good. 8 properties sold under the hammer, 2 were sold prior and 2 were sold after the property was passed in and it sounds as though a few will be under offer in the next few days. The interesting thing to note is that many of the properties that were been Auctioned today were of the higher end of the market.
This may be good news for the market in the fact it shows that the buyers are still out there and there are still people with money to buy. Sales numbers on previous years are well below what they were so it is still more important than ever to have your property stand out. Targeted, high profile marketing, sound presentation combined with a strong structure and a competitive edge when it comes to the price and you will attract the buyers out there to your property and hopefully the hard work put in will get an offer on the table that if not at an acceptable level you can work with.
The total amount of sales this year has been consistently moving downwards as the economy in New Zealand has been crippled by the global credit crisis. In recent months there has been some relief for us all with interest rates falling, fuel prices falling and tax cuts from the government but these are still not seen to be enough to help some of the struggling families out there as many won’t feel these reductions for many months to come. So the market still has some
The statistics below show the data collected by the REINZ for the Christchurch Central Area (The 4 Avenues) and how much different this year has been to two years ago.
The tables below read: DATE; MEDIAN; TOTAL SALES; DAYS ON MARKET
|
May 2008
|
$322,500.00
|
57
|
52
|
|
|
Jun 2008
|
$357,500.00
|
42
|
47
|
|
|
Jul 2008
|
$342,500.00
|
40
|
57
|
|
|
Aug 2008
|
$334,950.00
|
43
|
57
|
|
|
Sep 2008
|
$332,250.00
|
34
|
59
|
|
|
Oct 2008
|
$310,000.00
|
33
|
47
|
|
|
Nov 2008
|
$310,000.00
|
35
|
45
|
|
Now Compare this for the same period 2 years ago.
|
May 2006
|
$315,000.00
|
86
|
42
|
|
Jun 2006
|
$319,000.00
|
82
|
41
|
|
Jul 2006
|
$298,750.00
|
92
|
41
|
|
Aug 2006
|
$307,000.00
|
84
|
53
|
|
Sep 2006
|
$300,000.00
|
77
|
53
|
|
Oct 2006
|
$327,000.00
|
82
|
38
|
|
Nov 2006
|
$300,000.00
|
91
|
40
|
|
Dec 2006
|
$355,000.00
|
93
|
43
|
You can see quite clearly that the sales volume is below half of what it was two years ago for the exact same area. This is why it is so important to do all the things I mentioned above. The fact of reality is that there are more listings than last year and half the sales. Dont be the one sitting on the market and not selling. Be one of the ones who do sell. It is hard to look at the price from these graphs and compare it in this cross section as it is only a small sample of the market and too much influencial data can skew the data. But below is a graph of the median price for this Christchurch Central (4 Avenues) area. The other thing is the sales stats from the REINZ only show medium not average so many influencing factors can skew the graph over each month.
The market is not completely dead, as I said right at the start of this post there are still properties selling and today we saw a number sell under the hammer which just hasnt been heppening to that extent on a consistent basis for a while now. The feeling I get is buyers are ready to buy but are waiting for that opportunity that they consider a good buy. Most buyers I talk to out there say there is still a lot of room for the market to move. And unfortunately when your in a buyers market these are the words that are going to ring true in many cases. The sales volume for New Zealand in November 2008 were 4297 sales. The next lowest was in August 2008 with 4220. But previous to this years shocking sales volume drop the lowest sales in any given month was a massive 16 years ago when in January 1992 there were 4,427 sales.
Buyers are holding tight, but are still buying in other ways. Its a funny market, one none of us can predict.
There are people out there that can see good buys but so many more are saying they will get better and are waiting.
December 11 2008 | Buyers and Sellers and The Market | 2 Comments »
Google has released its official Search Results for google.co.nz in New Zealand. This actually makes for some interesting reading. It is interesting that the 6th most searched term in google is google. Go figure! It is said that you can tell a person by what they search on the internet, well can you tell the country from what they search.
Here are the results:
Top 10 searches on google.co.nz in 2008
December 10 2008 | Uncategorized | 2 Comments »
Today QV (Quotable Value) released their November Data on the New Zealand housing market and it’s fair to say that these statistics will have a few in this industry a little happier, but I feel the need to think is there more to it. QV have said this:
QV’s November statistics for the residential property market report a 6.8% decline in national property values over the past year (calculated over the three months ending November 2008 in comparison to the same period last year), the same level of decline as reported in October. The average New Zealand sale price for November dropped slightly to $375,408.
“This month is the first time since August 2007 that the annual change in property values has not dropped further than reported the previous month. Although this appears positive, it is still too soon to say that the market is recovering” said Blue Hancock of QV Valuations.
“While interest rates continue to fall sharply tighter lending criteria may be dampening any immediate impact on the property market. The strength of the Christmas retail season will be a good indicator of public sentiment and how hard the recession is hitting. Many businesses are currently feeling the pinch, and uncertainty over job security will be a major factor in whether people buy or sell property” said Hancock.
“Looking back we can now see that the market peaked in late 2007 then remained flat for six months. Most of the 6.8% decline in annual values occurred during the winter months and we may be seeing signs of a slight spring recovery. House values are now at the same level as March 2007, and remain higher for most people who purchased prior to that” said Hancock.
Most of the main centres are also showing some positive signs. In the Auckland area, property values are down 7.4% compared to the same time last year, which is a slight recovery from the 7.7% decline reported last month. Hamilton City also recovered slightly to -8.5% from -9.0%, the Wellington area rose slightly to 6.0% from -6.1%, Christchurch to -7.4% from -7.8%, and Dunedin to 7.6% from 8.2%. Tauranga was the only main centre to decline further to 8.4% from 7.9%.
The change in values remains variable in the main provincial centres. Whangarei ( 8.0%), Gisborne (-9.6%), Hastings ( 4.5%), New Plymouth ( 6.0%), and Palmerston North ( 9.0%) have all decreased less than reported last month. Rotorua ( 10.3%), Napier (-5.9%), Wanganui (-6.8%), Nelson (-6.2%), Queenstown Lakes (-12.5%) and Invercargill (-7.7%) all declined further.
So what do you think. This is my opinion. I believe we are still to see the true effects of the credit crunch. I don’t think that property prices are necessarily going to drop too much further but I do believe there may be more forced sales and some very motivated vendors with tight credit problems. This will give the buyer out there an opportunity to buy a property for what probably would be considered a good price. I see this trend continuing well into 2009. By maybe the middle of 2009 we might see more activity when the wholesale finance market levels out and debts recovered to a point where banks and lenders can lend credit again on sensible terms.
At the end of the day if you have your property on the market at a price which is reflective of all the surrounding conditions we face today you shouldn’t face to many hurdles when it comes to the business end of selling your home.
December 09 2008 | Sellers and The Market | No Comments »
Well today is the last day of officially living in New Plymouth. I have been reflecting on what I have achieved and learnt with my time here in New Plymouth and all I can really say is it has been a steep and progressive learning curve. I came to New Plymouth after leaving the Navy to look after my sick father. I had my Real Estate Sales Persons Certificate and managed to land a position selling with Harcourts in New Plymouth. This was when the real education started.
When I started selling I was only 20, almost 21. It was the first time I had never had a paid income coming in every week since I was 15 and after a month of that really freaked me out. On top of this the capital outlay to set my brand and the business up in New Plymouth was massive. They say when you start Real Estate to not expect any income for at least 6 months. I was fortunate to have scored a little listing at a small apartment complex in town and after doing all the right things sold it after the first weekend of open homes. This was really the kick start that started my real estate career.
From here on it became interesting. I started in August 2007 and the peak of the market was about November 2007 and ever since then it has gone down and making sales has become very much harder. But through my time I worked hard and continually invested time into learning how to better myself and do the job I was meant to be doing. In 2007 I worked right through the Christmas period and held up the fort at the office while many others were away on holiday. And this is when 12 months ago I really started to make some good. In January 2008 I was Top Seller for the office, March I was top Lister for the office, In May was top Seller again, In August and October I was the in the top 50 Real Estate Agents for Harcourts in the Wellington Region, And in September was again top seller for the New Plymouth Office.
This was done by just hard work and dedication to what I do. There are a number of things I strongly believe in that I will share at a later date.
Today is the day that I leave all that behind and move on to other things. Tomorrow I will land in Christchurch officially and start the set up process again. The hard work begins now. Actually it started last week with the packing. I have just been chatting to some people from twitter asking them what they hate the most about moving and there are two very clear winners.
1st has to be the actual packing up part. For my own situation, I just cannot believe how much stuff I accumulated over the time. The other day I was going through the wardrobe and there are things in there that I had forgotten I had even had. I am one of these people that find it hard to part with things… what do you call that.. hoarders. Well in my defence I am a Kiwi and I think that a good part of our population is just the same. I think the salvation army will be happy with all the things I have given them, especially this close to Christmas.
The second thing that people find the worst about packing was the unpacking. Putting things away, finding new homes for all the items you just packed away. All those boxes all over the place, probably sleeping on the floor for the first couple of days, having none of your electronic gear set up…. Man it’s frustrating just thinking about it. Grr!! Moving is stressful, especially when you are moving into the unknown. I have some great ideas though…
Well to all my past clients, friends, followers and anyone who finds this blog from New Plymouth, please stay in touch I will be back from time to time and if you need any help or assistance at any time just ask. For the people of Christchurch, I hope to meet some of you some day, maybe help in some way. If your looking for a house to buy or have to sell one call me and I will have a chat to you about it. I look forward to the challenges that are going to pop up starting from tomorrow. Moving, as frustrating as it may be should be positive, but I cant seem to feel any of those positives right now (as I sift though boxes looking for my phone)……
December 07 2008 | Uncategorized | 4 Comments »
Interest Rates Around the World are tumbling down as the Reserve Banks of different countries are trying to stabilize their economies as one of the worlds harshest financial crashe
s crunches down on everybody.
The Reserve Bank of New Zealand was the first to kick of cuts in December with a massive 150 basis point cut which took OCR down to 5.0%. After peaking at 8.5%, this rate has been cut 350 basis points since June and reflects the extent of the credit crisis. Since June, the New Zealand dollar has fallen 32% against the US dollar.
The Swedish central bank cut interest rates 175 basis points and took the OCR down to 2.0%. This was 75 basis points more than expected which shows how important and extreme this problem is. The OCR in Sweden have fallen 275 basis points and the currency has lost 41% since June.
The Bank of England cut rates by 100 basis points to 2.0%. The BOE was cutting rates from the end of 2007. Since December of last year, the OCR has dropped 375 basis points and the currency has fallen 28%. Housing is the major reason why the cuts are needed. The UK nationalized some of their biggest banks as their financial sector got trapped in the global credit crisis. A few days ago an aggressive plan was announced that will defer some mortgage payments for up to two years to counter rising foreclosures. House prices fell 2.6% in November and a record 14.9% for the last 3 months.
The European Central Bank joined the party by cutting rates by 75 basis points which was more than was anticipated. After raising rates in June by 25 basis points, the ECB has now cut rates 175 basis points to 2.50%. The currency has lost 21% since late June. after initially believing they were going to avoid the fallout from the US credit crisis, Europe has seen their economies collapse and doubts have been raised over the European Union’s ability to put together comprehensive financial stabilization packages.
The US Federal Reserve isn’t cutting rates yet. I have read though the Treasury is looking at a plan to force mortgage rates down. While the plan is evolving and may not be ready before Obama takes office. The US Federal Reserve dropped it interest rate late in October by 50 basis points to 1% which is the lowest level it has been since 2004 when the economy was recovering from the dot com crash. House prices in the US have come back by up to 30% in some areas. In November over 500,000 jobs were lost in the US, this is due to cost cutting by all industries to try and stay operational through this credit crisis. This is a snapshot of whats happening if you want more go to the CBNC website
The interest rate cuts do have positive impact on housing. It makes money more cheaper t borrow and closes the gap between renting and a mortgage which will see some buyers take action. The rates also help corporate borrowers who have been cutting costs and causing many in the workforce to lose their jobs. There will be still a fair bit of correction to go with this credit crisis. The banks are starting to take drastic action which has stabilized many of the markets around the world compared to what was happening.
December 06 2008 | The Market | No Comments »
One event coming up soon in Christchurch, which is one that cannot be missed is the World Buskers Festival. The 2009 Eureka Trust World Buskers Festival has a range of awesome performers such as circus, street and comedians People come all over from as far away as Argentina, Israel, the United States, Japan, United Kingdom, Canada and Australia and New Zealand to both watch, participate and perform.
This is what one of the Press Releases I have read say about it:
“From jugglers and contortionists to unicycles, clowns, musicians, aerialists, living statues, sideshow artists and acrobatics, the 2009 Eureka Trust WORLD BUSKERS FESTIVAL presents the ‘real deal’ when it comes to street theatre. Be it Canadian acrobatic duo LES VITAMINES; the RUSSIAN BAR TRIO; podiatric sandwich maker ROB WILLIAMS; funny freak SAM WILLS; clowns FRASER HOOPER and clown LOTO; NINO RETRETE; Australia’s MR FISH; SPACE COWBOY; DAREDEVIL CHICKEN CLUB; REUBEN DOTDOTDOT; pint sized contortionist BENDY EM; the world’s smallest banjo circus orchestra CLOGHOPPERS; stuntman extraordinaire SLACKWIRE SAM; Guinness World Record Holder YO YO GUY; Israeli aerialists CIRQUE NO PROBLEM; vaudevillians THE PITTS; SWANK; RUBBERBAND BOY; MULLETMAN; New Zealand’s FUSE Circus; CANDY D’LITE; MR BIRDBRAIN; OLLI, DOLLY & LIGHTENING LOU; magnificent acrobatic talent HEIR OF INSANITY; THE GARGOYLE; roving operatic duo THE PRIVY COUNCIL; Canadian improviser extraordinaire DEREK FLORES; aerialists SKYE BROBERG and JULIE LAVERGNE and MISS SATURN’S HULA HOOP FEDERATION from the USA – the 2009 WBF is absolutely jam-packed with ten days and eleven nights of fun, frivolity, non-stop fun and rather groovy moves from our festival dance
rs.”
This year the festival will be held from Thursday 22nd January 2009 to Sunday 1st February 2009 and held in Victoria Square. There are also going to be daily street shows in Cathedral Square, Botanic Gardens and some around some of the Malls in the city.
The Eureka Trust World Buskers Festival is one of the largest and best festivals of its type in the world. Each year the festival brings an atmosphere of fun and excitement to the city. Last year was my first festival and it was just a great event. One of the things that I truly enjoyed was how full and vibrant energy the city had while the festival was on. The influx of people was amazing and Christchurch was buzzing. If you’re in and around Christchurch from January 22nd to February 1st be sure to stop in and have a look at some of the events.
To view the Official Buskers Festival Website Click Here
December 06 2008 | Uncategorized | No Comments »
Todays OCR rate cut of 1.5% from 6.5% to 5% is a bold move by the Reserve Bank of New Zealand and is one that is hope to put some stimulation into our very slow economy. The OCR drop will mean to us as consumers a whole host of things that will save us all some money in the long run. 
The main one will involve bank interest charges. Credit card interest rates will drop. Westpac has been the first and has dropped their interest charges, Kiwibank also has lower than the given normal credit interest rate. This will be great coming into Christmas and may ease a bit of pressure of families.
The big one that will help hundreds of thousands of New Zealanders will now enter into a market with lower interest rates as all New Zealand’s banks have been told to pass on the benefits of today’s record 1.5 percentage point cut in official interest rates.
Unfortunately this doesn’t go far enough in my opinion. There are still thousands of people fixed mortgages on interest rates around the 8% mark and higher and the sad thing is the breakage fees for these people is in some cases more than the savings that they may make with the lower interest rates.
But for all new mortgages and people coming up for renewal this is the rates you should expect:
ASB has cut its variable rate from 8.7 per cent to 7.95 per cent, while SBS has cut from
9.15 per cent to 7.2 per cent.
Kiwibank cut its floating rate from 7.95 per cent to 7.45 per cent, its six month rate from 7.49 to 6.99 per cent, its one year fixed term 6.99 per cent to 6.49 and its 2 year rate from 7.59 to 7.19.
Westpac has left its floating rate unchanged, but has today moved to cut its fixed terms. Its six month term has fallen 0.25 per cent to 7.1 per cent, while its one year rates have fallen by 0.5 per cent to 6.8 per cent
BNZ has cut its six month mortgage rates by 0.5 per cent, moving from 6.99 per cent to 6.49 per cent. Rates on its ‘totalmoney’ product are coming down from 8.29 per cent to 7.75 per cent.
Also what we are seeing is the New Zealand Dollar Dropping as well. With the Reserve Bank of New Zealand cutting the OCR the New Zealand dollar against most of its trading partners is weakened keeping our dollar low. But when other countries drop their OCR their currency is also weakened.
The New Zealand dollar has fallen from above US82c this year to US53c this week. This has increased returns
to exporters. But on the flip side many exporters are experiencing slower demand in export markets as a result of the global financial crisis so the exporters needed today’s big cut to keep downward pressure on the New Zealand dollar so that this part of the economy doesn’t stall.
At the end of the day the interest rate cut announced today was one that was predicted by most because the economy has clearly been slow and this rates cut will do wonders to stimulate activity in our economy. This should be good news to home owners and people wishing to buy a new home.
It is now becoming much more affordable to buy a home now. Interest rates have come down from where they were, house prices have dropped in almost all areas of New Zealand. These two factors are making the market real again. House prices and new mortgages are now at realistic levels and if you are thinking about buying some real estate I think that you now need to have a serious look at the market and consider what your next move will be. Are you going to wait or move…..
December 05 2008 | The Market | No Comments »
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