Residential - Boom or Bust

[winner (n)]

Don't forget they also cleaned out their Kiwisaver accounts to buy that home, so will have no home and no retirement savings.  Basically starting from scratch all over again.

And further out won't be candidates for a retirement village in later life.

[Basil]

Don't forget they also cleaned out their Kiwisaver accounts to buy that home, so will have no home and no retirement savings.  Basically starting from scratch all over again.

Very true, happens in almost all cases I would wager. Its really heartbreaking stuff.  Really feel for these young people who have probably listened to well-meaning relatives who have advised them you simply can't go wrong with property darling, get into it. 

The less said about all the self-serving real estate agents who tell people the same thing without pointing out any of the risks, the better.   I'd wager many of these "professionals" are now telling people this is a fabulous time to buy.  Get in now after the market has fallen, there's never been a better time to buy...

[winner (n)]

Very true, happens in almost all cases I would wager. Its really heartbreaking stuff.  Really feel for these young people who have probably listened to well-meaning relatives who have advised them you simply can't go wrong with property darling, get into it. 

The less said about all the self-serving real estate agents who tell people the same thing without pointing out any of the risks, the better.   I'd wager many of these "professionals" are now telling people this is a fabulous time to buy.  Get in now after the market has fallen, there's never been a better time to buy...

No doubt mum and dad will write off their loans as well

[Basil]

Yeap, after all equity is gone the bank of Mum and Dad is always first in line for a haircut.

[arekaywhy]

Don't forget they also cleaned out their Kiwisaver accounts to buy that home, so will have no home and no retirement savings.  Basically starting from scratch all over again.

One thing I sincerely hope is that NZ matures, learns, and instills financial literacy into their children...cold hard reality can do that...hard times make tough men

[Popeye]

I talked a couple of young relatives out of buying in late 2021.  There was story after story about house price explosion, and about how unfair it was for young people not able to get their foot in the door.  Shades of the FOMO that led to 'every man and his dog' diving into the sharemarket before the 1987 crash.  The media managed to create anxious young people desperate to not be the ones left behind, never a good mind set when making a major financial investment. 

A more responsible media might have tried harder to explain property as an asset class amongst asset classes, just as subject to the rules of financial gravity as any other.  An extreme example - Tokyo apartment values did not recover for 25 years after their 1980s mega boom!

[Stoploss]

First homebuyers were sold on the dream of living alongside neighbours they knew. But now they say it feels "like we're living in a motel".
https://www.stuff.co.nz/business/property/131017798/williams-corporation-converts-unsold-townhouses-into-airbnbs

[KW]

Williams Corp just uploaded another 3 tenanted properties for sale, one bedroom townhouses with no parking, and they are asking $600-$620k for each of them.  They are rented at $450 per week.  Who exactly is going to be buying these?
Assuming you were a first home buyer, with a 20% deposit, your mortgage alone would be $740 a week, plus rates and insurance.  Almost double the amount of rent you would be paying.
Only a fiscally suicidal investor would buy one of these, and as they are built pre-2021 they do not even qualify for interest deductibility.
So you see AirBnB is really the only option for them (but only for newly built houses as you cannot get rid of existing tenants any more).  Or bankruptcy.

[KW]

First homebuyers were sold on the dream of living alongside neighbours they knew. But now they say it feels "like we're living in a motel".
https://www.stuff.co.nz/business/property/131017798/williams-corporation-converts-unsold-townhouses-into-airbnbs

"The six Biddle Cres townhouses once had committed buyers – but "settlement issues" resulted in the sales falling through.
"They were actually sold – our marketing at the time was factually correct."

This is only going to get worse.

[mcdongle]

It is starting to remind me a bit of the early 1990's

[winner (n)]

Wellington market getting better ...homes cheap as......no worries

Crowds at Wellington open homes as buyers see chance of $400K discounts

https://www.oneroof.co.nz/news/42935

[mcdongle]

Just put this here for a laugh.

https://www.rightmove.co.uk/properties/128248445#/?channel=COM_BUY

[Shareguy]

No mention of immigration.

https://www.oneroof.co.nz/news/43001?utm_source=nzherald&utm_medium=nzhapp

[KW]

No mention of immigration.

https://www.oneroof.co.nz/news/43001?utm_source=nzherald&utm_medium=nzhapp

Ssshhhh!
https://www.stuff.co.nz/life-style/homed/real-estate/131141553/migrants-share-of-home-purchases-climbs-to-over-11

[Ithaka]

Property values nationally fell by an average of 1.1% in January, probably quashing the industry's hopes of a stabilisation, Quotable Value says.
The drop suggested a steeper decline than previously measured by other monitoring companies, and put the annual decline at 12.1%, the property valuing company (QV) said.
The reductions could throw cold water on hopes that the decline in house prices were slowing as buyers became more comfortable with higher interest rates.
QV chief operating officer David Nagel said it looked like the market had not hit bottom yet.

Link