I have only met one Christchurch party paid out on their destroyed house, who have bought in Wellington. They intend going back to Christchurch in 2 years. It seems almost no one has been paid out on insurance. Any agents anywhere seen evidence of Christchurch influence? If these homeowners have not bought elsewhere, & can not yet re build….what are they doing? Australia? Renting elsewhere? Any ideas?
Archive for the 'And What About The Wellington Market?' Category
Real Life story. Apreciation the same. I appraised apartment at $470k, conservatively. They paid $265k, 6 years ago. Took owners yesterday to Northland ( we call it inner suburban, 10 min to CBD) house to see if they would buy it ( They want a family) . The owners of that house paid $250k 6 years ago, spent $20k on kitchen & decks. That has new valuation @ @465k. When apartment owners turned up, it turned out they had looked at it but chose the apartment, 6 years ago!
So relative to each other, the same value increase.
So those that say apartments around Wellington do not get the capital gain houses do are proven wrong in this real life example.
Dominion Post confirm. Leaders copy falls in this weekends Saturday paper to 6 pages. February high was 16. Its not jus Leaders, same thing with all companies by the look of it.
We prefer less stock to the huge wave then. Less stock, firmer prices, keener buyers, leads to more listings. A happy cycle!
Its likely Tax changes to property will reduce the suply of rental property.
Rents will rise not because landlords can increase rent to restore profitability just becaue they want to, but because tenants will have to compete for less homes. It will be messy, because with high land & building costs & unattractive tax changes, the private sector will not build any new rental property for this surplus of tenants.
In fact NZ is facing a housing supply crunch all round.
Sections need to be $50, 000 to $100 000 cheaper, ( ie, basic new 400 m2 section, cheap area, with sevices for $75 000 to $125 000) & true build cost to fall from a true all up cost that really has to be $2200 m2, to say $1500 m2 before this messy situation is averted.
My prediction? Either massive state building again, or steady backdown on tax law.
You will see Tax INCENTIVES on rental property within 5 years! Heard it first here
Tony Alexander of the bnz ( no its not the BNZ, they have marketing people so its the bnz,) has always done well in commenting & predicting, in my opinion. I say that allowing that the economist Galbraith once said at a party ” astrology was invented to make economics look good”
Tony said today, & I agree “In the housing market there is some evidence – based on Auckland data – that worries about tax changes have stalled turnover but prices are holding up and listings are not escalating madly.’
Rocky times for rental property, I predict
Personally I think tax changes to Residential real estate investment could be a disaster about to unfold…for tenants
I dont say that because I sell Real Estate..
this is why.
There is a general agreement rents will have to go up if landlording is made less profitable. Its as as simple as that.
For every tenant there needs to be a landlord. NZ owner occupier property ownership has been only slightly declining.
( claims the owner occupier percentage was falling were rebuffed when it was pointed out properties going to family trusts were going in statistics as a change to investment vs “owner occupier”)
No, many people who have never owned a house , but could buy a house rent because….they are going overseas soon.
As Ive said before, playing with property is an easy one for the government. But its the lack of profitability in the economy thats the problem.
If the government make being a landlord less atractive…who will tenants rent from?
If yields have to be higher, values have to be lower. How does a loss of capital of say 20 % help redirect investment? It dosnt make other options suddenly more profitable…just reduces wealth. I cant see sellers of investment property putting it in the bank, or buying NZ shares. It will go overseas.
And the question I can not even begin to answer:
Who will the 30% of New Zealanders who rent ( & remember, only 3 % of NZ tenants live in state owned rental houses) have as landlords, if the government make it less attractive to own rental property?
In the very recent past: Wakefield st Apartment in high $1 million area. Chaffers Penthouse in the $3 m range. Roseneath Property well over $5 million.
Bodes well for the 900 m2 home I will market after Easter.
Top 4 real estate sites in NZ including Trade Me & Open2View had increases in “Unique browsers “of between 29% & 31%. in January over December.
Yet January sales subdued.
Looking but not buying? Who knows. Cheap holiday entertainment?
NZ house prices have more than doubled in New Zealand in 10 years. This is historically the norm.
From $174 000 in Nov 1999 to $355 000 in Nov 2009.
So for every 100% financed , self funding house you bought then you would on average have now got $175 000, tax free equity.
Makes you think.
Effects of any tax changes will be the big housing issue this year. So I’m going to address its possible effects here over the near future.
Yes, These Are To Be the Topics.
How Do We Differ In Residential Property From Other Countries?
What Is The Result?
What Would Depreciation Changes Do? Who Would It Hurt?
Are Income Tax Reductions Likely To Balance Other Changes?
Why Are Mom and Dad Investors The Mainstay Of Our Rental Market?
What Is The Impact and Role Of Housing New Zealand ?
Demand For Housing Vs Supply.
Demand For Rental Housing Vs Supply.
Cost Of New House Build In NZ.
Cost & Supply of New Sections in NZ
Effect Of GST Increase On New & Existing House Values.
Realized Vs Unrealized Capital Gains Tax.
Capital Gains Tax: On All Property or Only Rental/ Investment. The Implications.
NZ Poor Superannuation Situation.
Would Renters Buy If Existing Landlords Exit?
Where Would Asset Reallocation Go, If Any?…Domestic share market?
…Domestic cash? Banks etc.
…Domestic direct investment in small business?
Would These Changes Make New Zealand Richer?
So Now I will Have To Do It.