New listings falling as unsold housing stock hits 10 year high; Rental property investors pulling back as they hit DTI limits; Difference with 2009/10 rebound is LVRs & DTIs, plus National stimulating
a housing market "improvement" would be if housing prices reduced substantially because currently they are exceedingly excessive relative to personal incomes.
Luxon's entire going for growth shtick us based on interest rates falling and so igniting the housing market. If that doesn't happen he's left with nothing.
Interesting take on the impact of DTIs when the actual data from RBNZ shows high DTI lending for investors is well under control with less than 5% above the DTI limit of 7 times income. The allowed speed limit is 20% so banks have plenty of wiggle room left.
I’ve just skimmed through the PSA’s Health Workers Survey Report. The quantitative results are deeply concerning, and the qualitative responses were heartbreaking. Sadly, none of this is surprising—it aligns entirely with what we’ve been hearing from the brave healthcare professionals who have spoken out.
As we head into flu season, something is bound to break—and badly. Even more worrying are the long-term consequences for our communities. Why does the current government seem so determined to undermine our collective wellbeing? Yes, there’s a clear push for privatisation, but even that doesn’t fully explain the sheer cruelty being inflicted on our dedicated public health workforce—and on all of us who rely on them.
You've gotta love reports from "unnamed mortgage brokers" as the evidence, but Tony Alexander has always been able to spin a good yarn. If investors are selling instead of buying, why are their DTIs increasing? This blames a convenient bogeyman but defies reason. And why point the narrative at these nameless "property investors"? As I have pointed out before, NZ is not a highly leveraged mortage market. And of 100 homes sold perhaps 1 or 2 of them are sold to people with large property portfolios. (20% to investors, and less than 10% of those to investors with many properties). We are grasping at straws to put this at the feet of large property investors and DTIs.
Why can't Alexander just say that, in a declining market, people - ALL people, from FHBs to the largest of the large - are hesitant to buy OR sell for all the obvious reasons.
I know not about DTI and related things but surely with many people leaving the country and losing work here plus low wages if you do have work, it’s hard to imagine having the drive or resources to be buying houses.
Especially when a high percentage of people leaving the country are in the 35-46 (or similar) range as Bernard linked a while back. That's an age people usually have a well-paid job, careers, children (additional contribution to the economy) and pay a significant amount of taxes.
Younger people don't have the income to buy expensive houses and older people don't move often.
Thanks Bernard...the NZ Herald *almost* got it this morning, with their front page article about significant private school fee increases not actually throttling demand for private schooling.
What we have is not a "cost of living" crisis but a "cost of being poor" crisis. The fact that all those home owners can simply wait for higher prices clearly exposes a large land-owning class in NZ without any real financial pressure in their lives.
Of course, given our country's largest newspaper now runs exclusively on Oneroof propaganda (and Harvey Norman ads), we're unlikely to ever see them with the same socio-economic awareness we are getting here.
Like Bernard pointed out the other day though, most people can only hold on for so long. If the dream of always lowering interest rates/increasing prices doesn't come to light in the next year or 2 - what do they do then? Many will have to bite the bullet sooner or later.
Morena, I'll share our recent (as in almost real time) experience of selling and buying a home. We have always had a plan to exit Auckland when all our children had left home and settled, however circumstance brought a property to our attention late last year. We had a look, had a hard think, made an offer that was accepted and then rushed to bring our West Auckland property to market with the usual tasks of gardening, some painting, decluttering and buying a few nice things for essentially staging.
It went to market the week leading into Christmas as "offers" and the week after New Year swapped to "due date". There were 6 open homes across 3 weekends , over 40 groups of people viewed the house and when the due date arrived there was a surprising number of offers for our character home that was just about to roll into a century. We chose and offer that we thought the best combination of dollars and terms. It went unconditional as planned and a couple of weeks ago we moved out of Auckland.
Lessons
1. get a good local estate agent
2. be realistic about what price you get (if you are striving for CV or more, as they say in The Castle "you must be dreaming")
3. a good family home, will find a good family
We are now settling into our new town. Our mortgage has been reduced. I wish there was a bucket of money for things Bernard mentioned, such as new cars and lounge suites, instead we are settling for a few storage items and some bedding for a guest bed we never had before.
I think the myth is that the New Zealand economy can continue and thrive as "housing market with bits tacked on..." could be finally facing some reality... what I'm concerned is that so many people, local government and central government want to deny it and not consider what should be next and what the New Zealand economy of the future could or should be.
I see this as a failed Engineered Industry for Unearned Income from Rental Markets controlled by the RBNZ, Mortgage Bankers, Real Estate Brokers & Government to Maximise short Term Profits for themselves and their Stakeholders. I suspect the TPU (Taxpayers Union, a subsidiary of Atlas Group) is onto this one as well.
Asking prices are not commensurate with actual Values of most all of these properties.
They're Nationally Averaged to create Panic Buying amongst 1st home & return to the Market Buyers with Sellers looking to cash in at the Market Peaks, but the RBNZ DTI & LVR Policies shut those same folks out of the Market and force them to liquidate Long Term Retirement savings to meet the extreme upfront costs levied by RBNZ & their Bankers.
The Banks of Mum & Dad have dried up & our kids are heading elsewhere for better pay and conditions to help pay off their Student Debts, or shirk them if necessary, to get a start on the Economic Ladder. It's a Gold Rush for Sellers and potential Disaster for Buyers risks as they rise in the current falling Market as the air leaks out of the Balloon at an ever increasing deflationary rate in a Stagflationary Market!
Why would anyone buy into this Buyer Beware Market with rapidly rising Rates & Insurances Costs, including EQC & ACC, as Real Values race to the Bottom of the Barrel?
If they can get into the USA, they have Government subsidised & assisted Lending on 30 year fixed Rate Mortgages. They don't have to Float, or fix to a maximum 5 years to play the Market rises & falls & Insurances costs are much lower in most all cases.
They're also able to hand in the Keys without destroying their Credit ratings in a Market Bust situation instead of eating the losses in a Mortgagee Sale if the Bankers gets nervous and decide to cut their losses as both Australia & NZ Mortgage Bankers do.
Currently the Housing Market in NZ is controlled by Investor, Landlords that are able to pump up Rental Prices on demand for terrified people trying to get out of their current situation of Renting, but having to spend their life savings and retirement funds in an over inflated Bubble, long overdue for a drastic Reset falling, or stalled Market.
The current attitude from Landlord's and sellers rests in Supply and Demand Market rules. They know they control the Market from Lack of Supply & can raise rents to cover rises in Interest rates on their housing investments if they need to hold out for top dollars.
The Flip Floppers buying Cheap and fixing up are out of the market at this point because of the extreme Construction Costs for building Materials & Council permits requiring in some cases, Environmental consideration & time it takes for approvals on Renovations to come through.
There is NO Buyers Market that's worth the Risk of losing the lot in an Economic downturn & we're in the middle of a recession that could see the bottom fall out of the market if we keep poking China, who has a 50% stake in our Export Market, with America's Big Stick hanging over our heads to join AUKUS Pillar II while Tariffs are rising like an Elon Space Train Satellite, while the US goes into Isolation. Even a Problem Gambler would be considering the Risk Factors in a shrinking Market!
I asked you a question last week about a Software Program for Landlords called "Realpage". The program takes advantage of Rental Prices, Market Supply & Demand & Flags Landlords to raise Rents on Market speculated Average pricing - Nationally, in the US where it is being widely used.
All you need to do is install the Software, load your Portfolio and Control your Profit Base from your Laptop, or Smart Phone. Some people call it their Pocket Broker. I'm thinking it's arrived here in NZ, but haven't heard about it commonly being used - yet? Have you heard of this "Landlord Software" Bernard? Tools like this allow Market Control & Lock in perpetual profits for the User.
Here's a link for Realpage - https://www.realpage.com/ Sounds pretty slick if your a conscienceless investor in the Rental Market looking to maximise Gains & manage Capital Gains & Losses from their Device, or Laptop... Makes the need for Ram Raids obsolete!
I have been wondering how New Zealand survives in a world where might is right. Continuing policies that only incentivise inefficient capital allocation really do come into focus, when we need to be the best we possibly can be.
Asking possibly a naive question: don’t we need the housing market to stall and continue to fall? Isn’t that the only way within a reasonable time to get to something more in balance and sustainable? That means some people will ‘lose’. I own my house without a mortgage. I have no investment properties. If I wanted to move, I’d be swapping one house for another. If the tide comes in or out, I rise and fall at an equivalent level. It’s only those who saw this as a neat investment, rentiers, who lose out. C’est la vie. The risks of any investment. Perhaps next time try harder and put it into something more productive.
If the housing market can't improve this will affect our "housing market with bits tacked on".
a housing market "improvement" would be if housing prices reduced substantially because currently they are exceedingly excessive relative to personal incomes.
And now the lobbying effort to remove the DTI's no doubt ramps up.
There is an election next year, gotta keep the bubble expanding...
Luxon's entire going for growth shtick us based on interest rates falling and so igniting the housing market. If that doesn't happen he's left with nothing.
Thank god then that the reserve bank is independent of politics - long may it stay that way
Interesting take on the impact of DTIs when the actual data from RBNZ shows high DTI lending for investors is well under control with less than 5% above the DTI limit of 7 times income. The allowed speed limit is 20% so banks have plenty of wiggle room left.
I’ve just skimmed through the PSA’s Health Workers Survey Report. The quantitative results are deeply concerning, and the qualitative responses were heartbreaking. Sadly, none of this is surprising—it aligns entirely with what we’ve been hearing from the brave healthcare professionals who have spoken out.
As we head into flu season, something is bound to break—and badly. Even more worrying are the long-term consequences for our communities. Why does the current government seem so determined to undermine our collective wellbeing? Yes, there’s a clear push for privatisation, but even that doesn’t fully explain the sheer cruelty being inflicted on our dedicated public health workforce—and on all of us who rely on them.
I think cruelty is the right description of what is happening.
It's not just penny pinching but cruelty.
You've gotta love reports from "unnamed mortgage brokers" as the evidence, but Tony Alexander has always been able to spin a good yarn. If investors are selling instead of buying, why are their DTIs increasing? This blames a convenient bogeyman but defies reason. And why point the narrative at these nameless "property investors"? As I have pointed out before, NZ is not a highly leveraged mortage market. And of 100 homes sold perhaps 1 or 2 of them are sold to people with large property portfolios. (20% to investors, and less than 10% of those to investors with many properties). We are grasping at straws to put this at the feet of large property investors and DTIs.
Why can't Alexander just say that, in a declining market, people - ALL people, from FHBs to the largest of the large - are hesitant to buy OR sell for all the obvious reasons.
I know not about DTI and related things but surely with many people leaving the country and losing work here plus low wages if you do have work, it’s hard to imagine having the drive or resources to be buying houses.
Especially when a high percentage of people leaving the country are in the 35-46 (or similar) range as Bernard linked a while back. That's an age people usually have a well-paid job, careers, children (additional contribution to the economy) and pay a significant amount of taxes.
Younger people don't have the income to buy expensive houses and older people don't move often.
Thanks Bernard...the NZ Herald *almost* got it this morning, with their front page article about significant private school fee increases not actually throttling demand for private schooling.
What we have is not a "cost of living" crisis but a "cost of being poor" crisis. The fact that all those home owners can simply wait for higher prices clearly exposes a large land-owning class in NZ without any real financial pressure in their lives.
Of course, given our country's largest newspaper now runs exclusively on Oneroof propaganda (and Harvey Norman ads), we're unlikely to ever see them with the same socio-economic awareness we are getting here.
Like Bernard pointed out the other day though, most people can only hold on for so long. If the dream of always lowering interest rates/increasing prices doesn't come to light in the next year or 2 - what do they do then? Many will have to bite the bullet sooner or later.
Morena, I'll share our recent (as in almost real time) experience of selling and buying a home. We have always had a plan to exit Auckland when all our children had left home and settled, however circumstance brought a property to our attention late last year. We had a look, had a hard think, made an offer that was accepted and then rushed to bring our West Auckland property to market with the usual tasks of gardening, some painting, decluttering and buying a few nice things for essentially staging.
It went to market the week leading into Christmas as "offers" and the week after New Year swapped to "due date". There were 6 open homes across 3 weekends , over 40 groups of people viewed the house and when the due date arrived there was a surprising number of offers for our character home that was just about to roll into a century. We chose and offer that we thought the best combination of dollars and terms. It went unconditional as planned and a couple of weeks ago we moved out of Auckland.
Lessons
1. get a good local estate agent
2. be realistic about what price you get (if you are striving for CV or more, as they say in The Castle "you must be dreaming")
3. a good family home, will find a good family
We are now settling into our new town. Our mortgage has been reduced. I wish there was a bucket of money for things Bernard mentioned, such as new cars and lounge suites, instead we are settling for a few storage items and some bedding for a guest bed we never had before.
I think the myth is that the New Zealand economy can continue and thrive as "housing market with bits tacked on..." could be finally facing some reality... what I'm concerned is that so many people, local government and central government want to deny it and not consider what should be next and what the New Zealand economy of the future could or should be.
I see this as a failed Engineered Industry for Unearned Income from Rental Markets controlled by the RBNZ, Mortgage Bankers, Real Estate Brokers & Government to Maximise short Term Profits for themselves and their Stakeholders. I suspect the TPU (Taxpayers Union, a subsidiary of Atlas Group) is onto this one as well.
Asking prices are not commensurate with actual Values of most all of these properties.
They're Nationally Averaged to create Panic Buying amongst 1st home & return to the Market Buyers with Sellers looking to cash in at the Market Peaks, but the RBNZ DTI & LVR Policies shut those same folks out of the Market and force them to liquidate Long Term Retirement savings to meet the extreme upfront costs levied by RBNZ & their Bankers.
The Banks of Mum & Dad have dried up & our kids are heading elsewhere for better pay and conditions to help pay off their Student Debts, or shirk them if necessary, to get a start on the Economic Ladder. It's a Gold Rush for Sellers and potential Disaster for Buyers risks as they rise in the current falling Market as the air leaks out of the Balloon at an ever increasing deflationary rate in a Stagflationary Market!
Why would anyone buy into this Buyer Beware Market with rapidly rising Rates & Insurances Costs, including EQC & ACC, as Real Values race to the Bottom of the Barrel?
If they can get into the USA, they have Government subsidised & assisted Lending on 30 year fixed Rate Mortgages. They don't have to Float, or fix to a maximum 5 years to play the Market rises & falls & Insurances costs are much lower in most all cases.
They're also able to hand in the Keys without destroying their Credit ratings in a Market Bust situation instead of eating the losses in a Mortgagee Sale if the Bankers gets nervous and decide to cut their losses as both Australia & NZ Mortgage Bankers do.
Currently the Housing Market in NZ is controlled by Investor, Landlords that are able to pump up Rental Prices on demand for terrified people trying to get out of their current situation of Renting, but having to spend their life savings and retirement funds in an over inflated Bubble, long overdue for a drastic Reset falling, or stalled Market.
The current attitude from Landlord's and sellers rests in Supply and Demand Market rules. They know they control the Market from Lack of Supply & can raise rents to cover rises in Interest rates on their housing investments if they need to hold out for top dollars.
The Flip Floppers buying Cheap and fixing up are out of the market at this point because of the extreme Construction Costs for building Materials & Council permits requiring in some cases, Environmental consideration & time it takes for approvals on Renovations to come through.
There is NO Buyers Market that's worth the Risk of losing the lot in an Economic downturn & we're in the middle of a recession that could see the bottom fall out of the market if we keep poking China, who has a 50% stake in our Export Market, with America's Big Stick hanging over our heads to join AUKUS Pillar II while Tariffs are rising like an Elon Space Train Satellite, while the US goes into Isolation. Even a Problem Gambler would be considering the Risk Factors in a shrinking Market!
I asked you a question last week about a Software Program for Landlords called "Realpage". The program takes advantage of Rental Prices, Market Supply & Demand & Flags Landlords to raise Rents on Market speculated Average pricing - Nationally, in the US where it is being widely used.
All you need to do is install the Software, load your Portfolio and Control your Profit Base from your Laptop, or Smart Phone. Some people call it their Pocket Broker. I'm thinking it's arrived here in NZ, but haven't heard about it commonly being used - yet? Have you heard of this "Landlord Software" Bernard? Tools like this allow Market Control & Lock in perpetual profits for the User.
Here's a link for Realpage - https://www.realpage.com/ Sounds pretty slick if your a conscienceless investor in the Rental Market looking to maximise Gains & manage Capital Gains & Losses from their Device, or Laptop... Makes the need for Ram Raids obsolete!
I have been wondering how New Zealand survives in a world where might is right. Continuing policies that only incentivise inefficient capital allocation really do come into focus, when we need to be the best we possibly can be.
Asking possibly a naive question: don’t we need the housing market to stall and continue to fall? Isn’t that the only way within a reasonable time to get to something more in balance and sustainable? That means some people will ‘lose’. I own my house without a mortgage. I have no investment properties. If I wanted to move, I’d be swapping one house for another. If the tide comes in or out, I rise and fall at an equivalent level. It’s only those who saw this as a neat investment, rentiers, who lose out. C’est la vie. The risks of any investment. Perhaps next time try harder and put it into something more productive.
The Weekend Herald 1 March 2025:
"The value of banks new mortgage lending to investors rose by 90% between January 2024 and January 2025..."
that is a substantial increase not a "sliding".
"Why the housing market is just not firing up"
because housing prices are too high for current incomes to be able to "fire it up".
Just imagine if they'd slapped DTI's of 4 or 5 on when they had the chance back in 2010! Better late than never still.