Auckland Property Prices

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  1. Post
    #51
    What are the chances of a capital gains tax being introduced? And how would that effect this situation? We have a landlord who owns about 8 properties, surely individuals owning so many properties is not a good thing?

  2. Post
    #52
    Well, with regard to the capital gains tax, the devil is in the details; how much, threshold, exceptions etc.

    I think it would certainly add some dampening onto the property market, how much is up for debate.

    Despite being quite involved in the property game I do think that there does need to be some sort of capital gains tax. The problem is going to be getting it through, as, for a lot of people (including many of our politicians), riding the housing boom(s) has become the default way with which to make some bank. Having said that, it's probably inevitable in the long term.

    As for people owning multiple properties; I don't think it's ideal, but it's really just part of the trend towards concentrations of wealth.

  3. Post
    #53
    Eight properties will be nothing, people probably own 100's. It doesn't help other people get a house, but someone has to provide rental properties for the market too.

  4. Post
    #54
    anyone have any updates to property prices in AKL now?

  5. Post
    #55
    You might like to be a bit less vague. What is it you are wanting to know? Are house prices still expensive? Yes.

    All depends on what area you are looking at in what price bracket.

  6. Post
    #56
    sorry, good point.

    was thinking around central area

    greenlane
    royal oak
    epsom
    remuera

    just wondering if anyone has any thoughts on the above.

  7. Post
    #57
    FrostiBoy wrote:
    just wondering if anyone has any thoughts on the above.
    Expensive.

    But yer, not much else to say. Not trying to be a dick and call you out (and I may be way off), but it sounds like you have some sort of specific question or concern with regard to these areas that you're reluctant to get into.

  8. Post
    #58
    ahh nah thats cool, left it open aye, Ive only had a little experience in that area. just following media at the moment and wanted to see if anyone thought differently. e.g. have ppl saying they are expecting a crash soon, high interest rates etcetc. wondering if anyone with more experience is thinking the same or different.

  9. Post
    #59
    Well, houses in quite a few parts of Auckland are continuing to appreciate in value, and sell quickly and it's certainly an easy time to be a seller. How long this will continue is all guesswork, and probably more influenced by external international events than domestic ones.

    Obviously the odds are against something catastrophic, but it's all complete speculation, a literal gamble.

    If you can't insulate yourself from some sort of price correction and/or interest rate rise then you're being an idiot, you may get away with it, and even reap the rewards of your risky behavior, but you're an idiot none the less.

    If you want me to make an off the cuff shortish term prediction then i'd say that the prices (in areas popular with immigrant buyers) will continue to appreciate into summer, but will level off, and perhaps fall off a bit ~6 - 9 months from now. But yer: guesswork.

  10. Post
    #60
    An interesting blog post from a mortgage broker in the Auckland market at the moment:

    http://www.squirrel.co.nz/auckland-speculative/

    The following quote sums it up: "When you can buy a house for $530,000 paint it for $10,000 and sell it 4 weeks later for $630,000 as one of my clients just did, there is something not quite right with the market and that invites ongoing speculation."

    It can't and won't last, but there could yet be another year of strong gains. However, the stronger and longer the gains are now, the more sudden and deeper the drop will be when it comes. Really the market NEEDS to flatten out, then things could very well just slowly correct or muddle along for a number of years. If it carries on like it is now, then the moment the sheep get spooked, there's going to be one hurr of a mess as everyone gets tangled up in the barbed wire fence on the way to the bottom.

    The sad fact of the matter is it's the people who get in last who get bitten the hardest, and from what I'm seeing amongst my peers (first home buyers), 80% LVR loans just don't exist, 90% is nice and 95% is the norm (99%+ when you take into account HNZ grants and kiwisaver cash-outs).... these will be the people who will be hurt the most when the correction comes and for their sakes I hope it's gradual.

    Above all else, I do hope that if the crash comes, it's allowed to take its natural course. I don't want to see the government step in and bail people out of bad speculative positions. If that happens, prices will stay high, nobody will learn any lessons and we'll set ourselves up for an even bigger fall 3, 4, 5 years down the line. At some point this hyped-up madness needs to end.

  11. Post
    #61
    What do you expect from said crash? Substantially reduced house prices?

    If the following happens I dare say you'll be right. Demand for housing in Auckland drops to zero and interest rates make keeping a house unaffordable for a lot of people. Those would be the two biggest factors IMO that could make it happen. I just don't see it that's all. I don't live in Auckland though, so am only 'speculating' that Auckland isn't going to stop growing any time soon.

    I don't see any drastic changes in either direction with prices either though. Maybe they will plateau, maybe they fall or rise. Perhaps if those hidden volcanoes erupt you'll be spot on


    Note: I don't pretend to study this stuff and know more than average Joe. Just voicing an opinion based on a little bit of monitoring of property (not in Auckland though) over the last few years. As mentioned earlier too, no one knows what will happen. We can only make guesses based on information at hand and how we interpret it.

  12. Post
    #62
    To elaborate on my earlier post:

    The present underpinning for the growth in the Auckland residential property market is from immigrant buyers, with most of those coming out of China.

    I suspect we're seeing a period of fairly rapid appreciation in prices at least partially due to many wealthy Chinese seeking some insurance against (the almost completely unreported in Western media) internal political instability in China due to the succession talks, and upcoming party congress. When this resolves itself (supposed to be by the end of the year, but who knows) I suspect we'll see a gradual flattening off, perhaps followed by a dip.

    Iv'e said this before, but the properties that will retain (or increase) their values the best will be those properties in areas popular with Asian buyers (generally categorised by centralish location and good schools nearby). Those areas less popular with this type of buyer are having their prices dragged up somewhat artificially, and, in my opinion, are most likely to bear the brunt of any slump should it occur.

  13. Post
    #63
    Esprit wrote:
    An interesting blog post from a mortgage broker in the Auckland market at the moment:

    http://www.squirrel.co.nz/auckland-speculative/
    Good article, thanks for posting

    Anyone got opinions on building new houses in Auckland? Positives/Negatives?

  14. Post
    #64
    simblor wrote:
    Anyone got opinions on building new houses in Auckland? Positives/Negatives?
    Well, this is basically the best way to make money in Auckland at the moment.

    It's all about location, and building a house that appeals to the primary market demographic.

    The obvious negative to it is that it requires significant capital, and banks are less willing to lend to build.

  15. Post
    #65
    Yeah the hardest part is getting the finance.

    A) Easiest would be house and land package with fixed price contract on the whole deal.
    B) Hardest would be buying the land yourself and organising everything to do with the build yourself.

    A is probably possible for most people in the market (with the potential to borrow of course)
    B is possible if you have the cash to pay the deposit on land (higher % than house and land) and can fund the build from your pocket or with the help of guarantees from family members or whoever.

    A is potentially the most expensive option. Doesn't require any knowledge of building and what's involved.
    B is potentially the cheapests option. Requires knowledge on how to do it all and carries the greatest risk of something not quite going to plan.

    There would be compromises between both of those, but not many really. I have done option B got the section ourselves and help with securing loan for build. Next time would go for a compromise and buy land and get a fixed contract for the build part of the deal. Things just get really messy when you have to involve other parties.

    It's more complex than the above, more details etc. But writing that much is a push for me on a weekend

    I enjoyed doing it, with the result being a brand new house to live in. But you need to do a huge amount of homework before you even start to look into land etc. It's not a simple process, but is worth the effort.

    My $2

  16. Post
    #66
    Ive always found it more lucrative to do the paperwork and sell someone else the concept. People often pay a premium for dreams.

  17. Post
    #67
    I went to a open home in Glenn innes -
    My god it's full of Maoris and islanders. I don't feel safe living there
    But it was a cheap leasehold land area 2 bed 1 of 3 units. Going for $290,000.

    What are your thoughts on Glenn Innes?

  18. Post
    #68
    My thoughts on Glenn Innes are better than my thoughts on leasehold.

    Never buy leasehold.

    290 for a leasehold two bedroom in GI. **** me this could get ugly.

  19. Post
    #69
    Went to another open home today. 1/289 Kohimarama Road. 2 bed room and a carport.

    R.V $355,000 vendors wanting 450,000 to 500,000.

    1st unit of 3. It's very tidy newly painted and carpet.

    Agent said $400 to $450 weekly rent.


    One of the cons is the traffic noise is unbearable.

    Is the weekly rental inflated? $400-$450 seems high for a 2 bedroom place.

    My budget is $300-420k.

  20. Post
    #70
    It gets worse, 2 bedroom UNIT leasehold for 290k. someone's taking the piss.... sad fact is they'll probably get it.

    GI is definitely still a bit "dark", but I've lived there recently and it's quite nice, at least up the hill a bit towards Glendowie. Solid houses up there on >500sqm sections though are now going for >600k to well over 700k, so that boat has already sailed for first home buyers.

    You have to look at the comedy of it all.... baby boomers are out of touch, they say that GenYers just want to get a nice house in a good central city suburb but aren't prepared to start at the bottom of the property ladder... when the sad fact is that even the scungy suburbs are pretty much out of reach in Auckland for a working couple on average wages. Especially when you take into account that people buy houses 1-5 years before wanting to start families, where they'll have to make do with 1 income or at best 1.5 incomes for a while... the madness shows that we really are at a tipping point here.

    Prices will continue up and average people will have to move out of Auckland if they want to buy a place, or buyers will just say "**** this" and the market will drop like a stone. It could go either way.

  21. Post
    #71
    yo whats the weekly payment for a 300k mortgage 30 year mortgage at a fixed rate of like 7%

    ps GI is trash

  22. Post
    #72
    $459

  23. Post
    #73
    Esprit wrote:
    Prices will continue up and average people will have to move out of Auckland if they want to buy a place, or buyers will just say "**** this" and the market will drop like a stone. It could go either way.
    Only prices in small pockets of auckland have gone through the roof? i.e Grey Lynn etc.

    West Auckland is now a first home buyers market and there is alot of Chinese money fueling some house prices.

  24. Post
    #74
    indian too, all the houses iv been to central mostly indian home hunters, iv heard that indian immigration ison par with asian, where tje whites all gone?

  25. Post
    #75
    The Auckland housing market is terrible. My wife and I have given up on the idea of buying our own home up here in Auckland, so we're moving back to the Bay of Plenty next year where things are much more affordable. Sure the job market is absolutely pathetic down there, but it sure as hell beats paying a huge mortgage and being locked into working for the rest of my life in a cubicle like a slave.

    Right now I am looking to rent an apartment in Parnell and it's been very hard to find a good place since April.

    Not everybody has rich parents to fork out a huge deposit for a house, nor do both people in a relationship have high paying jobs to pay off the mortgage, especially when it comes to maternity leave, etc.

    NoCash wrote:
    Went to another open home today. 1/289 Kohimarama Road. 2 bed room and a carport.

    R.V $355,000 vendors wanting 450,000 to 500,000.

    1st unit of 3. It's very tidy newly painted and carpet.

    Agent said $400 to $450 weekly rent.


    One of the cons is the traffic noise is unbearable.

    Is the weekly rental inflated? $400-$450 seems high for a 2 bedroom place.

    My budget is $300-420k.
    No $400-450 for a 2 bedroom place in Kohimarama is pretty decent and honestly below the standard cost of rent in that area.

    In March I applied for a similar property further up Kohi road towards Mission Bay that was $500 per week to rent.