I rent a four bedroom, 7 year old house for $465 a week, in a newish subdivision. I see no way in the next few years for me to buy a house, Unless I decide to get married or something silly! :P
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I rent a four bedroom, 7 year old house for $465 a week, in a newish subdivision. I see no way in the next few years for me to buy a house, Unless I decide to get married or something silly! :P
Its not too bad lol but as precission is required :D
Rent increase of 24% = $22 as stated on the TV
Previous rent $91.67
New rent $113.67
OK its a little more than I previously posted but going by the posts since sill sounds like they have nothing to complain about to me. Dont know how the rest of you feel about it but if my rent went up from $92 to $114 I would still be stoked and too ashamed to be caught with my mug on the TV complaining about it.
Oh, just checked my post Shasta and I see what you mean
$88 plus $22 = :o
In earlier writing I have used the word crash many times.....
There seems to be a great miss conception of the word... some have rubbished the word, What does the word really mean to others?
anyone got a personal definition of the word?
Im not looking for text book answers, Im just trying to get a better understanding of what others think of it because it can be used in broad terms and taken out of context, or misinterpreted by others?
any of the bulls care to address The Word 'Crash'... Further more, Is a Crash coming in their opinion?....
In the last two months I have seen a clear shift of the bulls thinking...
They now write more bearish... They have backed away from heated debate...
Even Joe Kid scattered after he admitted he sold all his houses...
Remember dudes, the bigger the up and the longer the up... leads to a bigger down and a longer down...
I would have personally liked to have seen the bull last longer, it just makes it all the cheaper at the bottom....
.....
Ive been talking to many people, I know of a few that have gotten in within the last 6months... 'thats worth a log in their pants right now'...
sell to re-enter...
I was told to BUY no longer than two months ago, dating back to the start of this thread...
:cool:
.^sc
Good question Shrewdy. I would say 25 to 30% would be a crash. Im not concerned though. A major fall in rents would worry me more and if they fell to "state house in Christchurch" levels I would probably fling myself out a window. Im picking a 10% drop max and a slight revival come spring 08 followed by about 3 years of sideways
Or Shasta you could look to your local council who have properties like:
Studio $84.00
- $108.50
Johnsonville, Newlands, Wilton, Kilbirnie, Miramar, Strathmore and the Inner City
1 Bedroom $115.50
- $175.00
Berhampore, Newtown, Miramar, Karori and the Inner City 2 Bedroom $182.00
Berhampore, Newtown, Miramar and Karori (stand-alone properties)
3 Bedroom $210.00 Berhampore, Newtown, Karori, Wilton and Brooklyn
4 Bedroom $294.00 Berhampore, Newtown, Karori, Wilton and Brooklyn
5 Bedroom $364.00 Mt Cook and Brooklyn
6 Bedroom $378.00 Newtown
Fleming,
I get a real buzz out of what I do and Im always relaxed...
smiley face and shades would be a great description of me...
-->:cool:....
No tension in my spring what so ever...
I'll be overseas in a few years so I really dont give a cook-a-hoot to what happens in the housing market...
It all just makes for interesting debate...
It would be great to have something to come back to...maybe a holiday home...
My life doesnot revolve around money... I do take a hands on approach with my shares and portfolio which has paid for the student loan...
I dont have a financial calculator, Prob should get me one...
:p
.^sc
Steve, don't tell SC to get a job. This country needs more entrepreneurs. The education system programmes us to "get a job". What it should be promoting is getting out there to create wealth. We already have one of the highest rates of company formations in the world (and failures) which says we have a latent talent for taking risks.
SC don't listen to Steve. Get out there and use your talents mate. Create wealth and the good times will be with you along the way....
Back to the original theme, great to see an article in Wellington finally admitting that apartment living may be the way of the future.
http://www.stuff.co.nz/4455743a6160.html
Even the thought of housing families in apartments!! Doh.
Why are NZ city planners so far behind urban planners in most other countries in the OECD?
Arbitrage are they going to get all this extra sewrage down the same 6inch pipe they use now. They will just about have to replumb the whole city as they have found in Auckland. Auckland City council wants $40000.00per apartment in some cases as an infrastucture contribution.
.................................................. ...................................
Part 1 - With inflation becoming rampent, what effect does that have on housing costs.:confused:
New laws and regulations +++++, cost increases +++++, more cost increases +++++
.................................................. .................................................. ..
Part 2 - the crunch will be in certain sectors of the property market, maybe you would care to read "1000 Barrels a Second" to get an insight into the future of peak oil. ;) and how it will effect you personally.
Metro Realty in Dunedin (biggest here) is having a 'autumn sale' next Thursday night - 57 properties going up for auction!!
Anybody seen Campbell live tonight?
....
Housing crunch... get out now.... Sell and re-enter...
Panic sell is the best strategy because we are at the beginning of 30% falling market... Auckland could fall further... dump on market below GV if need be...
Yeeeaarrrrhhhh Haaarrrrrhhhh....
exciting times ahead...
SELL SELL SELL...
Its No brainer...
:cool:
.^sc
http://www.stuff.co.nz/4466701a19715.html
Out of interest, how many here are baby boomers, how many are generation Y/X etc?
Do you guys agree with that article?
lolol (at the anecdotal evidence in that article)
http://www.youtube.com/watch?v=IeXMK...eature=related
I'm Gen X, my wife is Gen Y.
We consider ourselves extremely fortunate to have not just survived but thrived through the "tech wreck" 8 years ago, largely due to our realistic expectations and concerted efforts to run away when we all too often hear "It's different this time".
We also benefitted from the massive run up in real estate prices in recent years. We see the same things happening as with the teck wreck....and for the past few months it's becoming increasingly obvious to the layman(or woman). We have no desire to sell our home, but we are rationalizing our non-farm property assets to take advantage of once in a generation ridiculously low yields/high prices.
Most of our peer group do not own property........we often get drawn into conversations about buying a home and property investment.
It would be foolish of us to not include "luck" in how we have achieved our strong returns...but a big part of luck is in "making" your own luck........head down, ass up, save, save, save...so one is well placed to take advantage of opportunities when they present themselves.
People have been conditioned to expect what they want, when they want it.
Those who have sacrificed and delayed gratification will do particularly well in the coming years...those who haven't sacrificed and saved will continue down the tracks to nowhere until they change their behavior.
My guess is that reading this article in 12-24 months time will result in the tables being turned a bit.
Property leverage is great when the tide's coming in......but property wealth can disappear just as quickly when the tide goes out.
Categorising people into Boomers, Gen X and Gen Y is rubbish. I agree with the last two posters about hard work, saving, and delaying gratification. In every generation there are those who do all of that, and there are those that live for the day.
I look at todays older people who are on the pension. There are those with assets and savings who are comfortable, and those without who struggle only on the govt payments. I can look around now and see people who are earning good money and I can tell you which of the older generation camps they will end up, irrespective of their "Gen".
"quote.."In the last two months I have seen a clear shift of the bulls thinking...
They now write more bearish... They have backed away from heated debate...
Even Joe Kid scattered after he admitted he sold all his houses"... unquote
Shrewdie one day ya just gotta grow up. Winners/losers, there are plenty of both. Just like the current opportunities on the stock market, there are incredible opps in the property market. I haven't "scattered" at all. Just sitting back watching losers lose and winners win. Life goes on...
One thing's for sure young fella... if ya gonna be a winner you better start thinking like one >>>
Cheers and good luck
JK
Hey Joe King...
I am a full time student and I have a job working 4.5hrs per week as a poker host earning $90... Im also eligible for an allowance this year as my dad just retired...
cant buy a house even if I wanted to, and I dont want to...
...
Dont you worry about me buddy, Ive got it all sussed out...
Ive got a small group of my best friends in on my idea
.... when the carnage is over I will be buying my own house and more than a few houses with a group of mates all putting in 7k or so per house...
I wont buy into this 'its never a better time to buy than right now'
I have mad respect for the bulls... Its different for your group and quite frankly you will never understand it from my view because you are set in your ways, your views are biased because you are a housing buff, taking advice from you is more damaging than good...
theres no point going out on a crusade buying houses now...
Im not on some sort of heroic mission...
Im smart, not mad..
disc, LMPO, GGX, RPM, LMP, AKK.... all performing...
Good day...
:cool:
.^sc
tok3n posted a good article.. I hope you sit down and read it some time...
:cool:
.^sc
I am a 22 year old female from Wellington. I earn $45k per year. I do not have a university education. My partner of 6.5 years is a qualified plumber, just out of his apprenticeship, and earns about the same as I do. He is also 22.
In March 2007 we purchased a 4 bedroom house in Pukerua Bay (half way between Wellington and the Kapiti Coast) for $312,000 - our first house. Our interest rate is 7.99% fixed for 5 years, we have a 100% mortgage. The small deposit we had attempted to save has gone towards a new bathroom - yay for dating a plumber!
I've been reading this thread for a long time now. I've seen the arguments go back and forth so I thought that today was the day I should speak up and join the fun.
My partner and I seem to have struck it lucky, have we not?
Are we going to regret the 100% mortgage?
Are we being completely naive about this?
Or is the process of buying a house actually as easy as it has been for us...?
Huffer, congradulations on purchasing your first home.
If this is your home and you are looking to live in it for a long period, it is a great idea. I encourage all yound people to buy their first home and pay it off asap. You should try to reduce your mortgage asap. Too much debt is a dirty word.
Enjoy your new house.
well done, wish i'd started at your age...... get stuck in and whittle that mortgage down,
every time you have a few $$'s spare throw at the debt. It may take some years but you will get on top of it and then you'll realise how smart you have been...
Huffer,
Well done on your purchase of your home at such a early age. My only concern with 100% mortgages is that, if properties drop 10 - 20% you won't have any equitity in your home & the banks may force the sale of your home.
ABSOLUTE RUBBISH. Banks dont close on a mortgage that is being paid unless it lapses into debt. Why would the bank have a mottgagee sale losing money if someone was paying it off during the bad times. Its a very stupid statement made by someone that is not in the business. Macdunk
good on ya duncan... after reading at the nzoop quessing game i thought you had gone soft. p.s. - you are also right.
I can azure you they did just that in the early ninety's
Huffer, congrats on getting started with property.
The important thing is to build up a cash buffer of at least a few months worth of expenses.
Then any surplus money each month can go towards paying down the loan and / or investing to get yourselves further ahead.
Do you have a 100% offset account with your mortgage? We had one. Your income goes into it, and your expenses are paid out of it. However while you have money in the offset account, it is reducing the amount of interest you pay, which helps you to pay off the loan faster. The other good part about it is - the money in your offset account is available to you, in case something comes up where you need the extra money... as opposed to paying extra off the loan and the money is not available to you (unless you pay the bank a fee for the "privilege" of increasing your debt).
Macdunk, We'll see what the banks start doing once property prices start falling 20% in the next year or two. Alot of property investors have 100% mortgage loans on there investment properties & I'm sure the banks are not going to sit there while these investors have no equitity in there homes. There are more & more properties listed as mortgagee sales on the market in the last few months.
Properties have gone up too fast in the last 4 years for there not too be a major correction. I have been in the property market for a number of years & cashed up at present waiting for some bargains. This is my view only & don't tell me that properties only keep going up!
MD
Prices drop 10% and at roll over time some people are under water or now need 100% loan as since they took the loan out they have lost their 10% equity they started with.
Be assured banks are shying away from 100% loans especially in a falling market.
therefore same result ,
many forced sales just not with the Mortgagee title
Macdunk is correct in saying that banks won't take any action as long as the repayments are being made on time.
Srotherh is correct in saying that when it comes to roll-over time, the banks will consider the equity situation when making their lending decision.
It's only getting better for those who are waiting (like SC!):
House of the sinking sum
In the surest sign yet that the runaway train of the property market isn't just slowing, it's grinding to a slow halt, house sales around the country in March slumped to less than half the number at the same time last year.
Forced sales up nearly 20 per cent in a week
A surge in mortgagee sales is surprising even seasoned real estate agents, with one dealing with 70 forced sales in three months this year - compared with 12 for the whole of 2007.
Other data collected by property experts shows mortgagee sales nationally rising almost 20 per cent in the past week as banks foreclose on families and property investors hit by crippling interest rates and the rising cost of living.
If you’ve struck it lucky you’re in trouble.
Hopefully you have carefully thought out what you want, how to get there and how to keep it. If you have worked to get to where you are you’ll be fine. Get that three month income buffer, hit the mortgage and stay healthy. Try to keep those spare bedrooms full of flatmates and not the patter of little plumbers and you’ll set yourself up well.
If, on a whim you’ve just gone out and bought a house, luck won’t get you far when the times get hard. Buying a house isn’t hard. Keeping up with the repayments, rates, insurance and maintenance is where things will start to get tough.
Steve - as one of those left on the sidelines, i must confess to a certain malevolent pleasure in reading these articles. Must say I am hoping for a big crash (but not holding my breath - I think it's more likely it won't happen, just stagnation for a few years instead).
I'm a bit like Yossarian, your typical Generation Y, asset poor i.e. no house :(...but reasonably cash rich, hold some resentment towards the baby boomers.
Hoping for a housing crash too, to get in for "self-fish" reasons, but there's probably plenty of us in the same situation ready to "prop" the market up lol, ironically.
Oh while, back to trading I guess.
Tok3n,
No need to resent them mate... our generation will inherit all the good work they have done...
these Baby boomers have savaged all chance for us to really get ahead...
Its not their fault, they were out to get a few bucks, so good on them...
Enjoying the same run they had is impossible for us... we could never achieve the same sort of results/returns...
I dont care what Im told...
Ive completely broken down both sides... The Bulls (or buffs as I call them)...and the non buffs...
Ive heard the stories....
30k to 300k.... Nowadays it would have to be 300k to 3million to get same returns... big price difference... Ive posted all this sort of craap before...
House prices willnot be 100% higher in 10 years time from where they are now... I dont care about historical performance...
Average wage would need to be 125k per year for that to happen...
Some people are only on 25% of that now...
I mean, if I want a house I have to be prepared to pay big bucks every single week for 30yrs...
Whats exciting about that?
Everybody wants to make money... I willnot make money at the expense of my wellbeing... Jail cell styles...
Id be a 53 year old man in crisis mode with a house or two only...
bleak future indeed...
Why does that clown not understand...
they had it too easy...
You just wait my friend...
That generation had a mad uptake of housing... This generation wont be too concerned about it... we inherit it anyway... Housing performance in the past willnot be the same in the future...
Brand spanking new apartments in China for 30k NZ...
when this World Wide slump is over, they will be 20K...
At least that way you dont have to give a life term to pay for it...
Yes, penitentiary here mate at these prices...
Expecting a mad selloff and abit of panic mode over the next few years..
No need to go out on a Limb and buy now...
Be smart, dont be heroic...
....
Only a buff would recommend you be heroic...
....
what happens after the baby boomers leave is in our hands...
we will find out over the next few decades if our generation is prepared to get into Life terms to continue supporting upwards rising house prices, (eg like in some parts of Auz)...
next 5 years will be our chance to get in...
In the future I will explain exactly how to leverage a house off another one with little down payment... its no magical secret...
I will explain exactly how to get a mortgagee sale...
I will tell them everything they dont tell you...
We have plenty of time to watch, learn, earn, and save and when its over have more than 50% down payment on the first house, or spread it over a few...
The great thing about this is that We get to watch the American Housing market unfold because we Lag their market by two years...
many other countries are being hit...
NZ will fear up there with the worst of them I believe... with our World leading high interest rates... High Inflation rates currently above the 1-3% RBNZ band, finance company risk, low wages....
send money offshore for now, bring it back later on... you put your left foot in, put your right foot out...
do the hokey pokey and turn around.......
....
...
..
.
Thats what its all about
:cool:
.^sc
SHREWDY, What a load of rubbish you preach. property in any country is priced by the cost of building a new building. In bad times builders leave the country like i did in 1967 in nz, and ended up making twice as much in Australia. When i got back in 1972 there was an acute shortage of builders who could name their own price. History is repeating mate, you will outsmart yourself and miss out.
In china the wages are stuff all in comparison with the likelyhood of rising at a faster pace than here. Your chinatown house will one day be higher than a house in NZ. The NZ worker with free trade, is now heading for the three bowls of rice a day in order to compete. Changing times you should buy a house with a westpak 110% mortgage live rent free for six months before you bugger off to china. Macdunk
Any other opinions...No,.what a load of rubbish you preach...
Are you telling me for the next few years that costs are going to decrease by 20-30%...Quote:
Property in any country is priced by the cost of Building a new Building
haha...
:cool:
.^sc
BRUT you might be right in that statement. However with costs heading north at a great speed of knots if prices drop, all building work stops. This in turn creates an over the top demand eventually raising the prices higher than ever before.
If the demand exceeds the supply due to tradesmen leaving the country which happened in 1967 when we all buggered off, look for a repeat performance. Dont expect me to be nice to SHREWDY, he didnt introduce me to his girl friend last time we met. Macdunk
Mackdunk,
You have such a negative attitude...
Especially on the NZO thread... brain dead this... herd that....
you are a possessed stubborn lunatic who is set in your ways...
Some of the best advice I was given, was to to take the positives out of any debate...
...
Ive given it up to you, agreed that the long term picture is rosey...
I do agree with many things you say...
I just dont agree that its never a better time to buy than right now...
I have slammed housing for what the near term will do...
You have focused your efforts in the long term picture...
Your time frames are messed up...
This thread isnot for business men housing buffs who troll the market, (eg, you can find a good bargain in any market theory, which can be true)... this thread is for first homebuyers, who can eliminate risks through not buying now... waiting for the market to turn... and buy when the time is right...
Any type of investment is about timing, Right?
You have never given one Inch...
You have gone so far, and are in so deep that before a few months back, you even refused to believe/ or post that bad times were coming...
bad times are coming MD...
You know that its true... you just dont post it...
:cool:
.^sc
My whole debate is centered on the near term outlook...
Your view isnot...
Add your thoughts to the near term outlook or dont add them at all...
Ive asked what you reckon the near term will do and you completely dodge the questions...
Joe King sold up, Sounds like you have sold up...
all the smart ones have sold up?
why are you still towing that line... ESP Joe King...
If its seriously never a better time to buy then why has the King sold?
:)
.^sc
Do you remember what the King Said..Heres a quote from the King......
JK has been honest... you are more secretive MackDunk...Quote:
Joe King-For those new to ST. JK used 20k equity in home and leveraged it into 37 properties over 3 years. (see earlier pages this thread) Since sold all but 6 and retired.
Just what are you really up to...?
You are out of the sharemarket !
you are a smart man... I would be surprised if you werent out of the housing market (like the king), or getting out...
SELL SELL SELL
:D
.^sc
SHREWDY, You miss the whole point completely. Joe and i are both of similar opinion which you fail to understand. In 1967 when i left NZ a friend of mine bought a house in AUCKLAND in a falling market. When i looked him up in 1972 the price of his house was worth more than half as much again. The cost of building the house had doubled builders were asking their own price, most had left the country, and not returned. He told me he could not have saved as much any other way, even if he lived in a rental garage for those five years. I told him to refinance, get a deposit on some more properties just like JOE KING has done. He is now a very wealthy man, who has only ever had a low paid job but is smart enough to know the wood from the trees. At the top of any cycle its time to take out some profits. I have a similar outlook to JOE pick his brains you will learn a lot more about business than going to uni. Learn about using other peoples money to full advantage in a practical way, listen to JOE he has been there done that. Macdunk
Offset accounts are useful for investment properties. They are interest only (usually the floating rate), can be paid off at any time with no extra fees, and can be drawn on for repairs and maintenance. With rents going into them they act as an operating account for a property investment business and make tracking income and expenses easy. But yes they do require fiscal discipline.
Hi KW, I hear what you're saying... offset accounts are a trap for those without discipline. I guess lots of people just HAVE to have that new "toy", and they go backwards because they "can".
The offset account is a great tool IF you have the discipline to make it work FOR you, not against you.
I don't need to worry about it anymore, we paid off the home loan in 4.5 years.
On another note, I cringe when I hear of people with lots of property who take out a larger loan against their property portfolio each year to pay for their living expenses "tax free". It might be a tax free "income", but it isn't free, its costing them the interest rate year after year after year and increases their vulnerability in the event something unforeseen happens. In my mind its better to own them free and clear, or at least have a healthy interest coverage ratio if you've still got some debt against the properties.
MD,
If you and King were screening parts for the Movie 'Braveheart'... Joe King would Get the role of Longshanks...
you would get the part of that Irish guy...
The one that said...
"I am the most wanted man on my Island, BUT I am not on my Island"..
:cool:
.^sc
I agree strongly with this advice.
I considered myself very financially disciplined, but found it it tough at times while I had one of those credit lines. You plan to sprint paying off your mortgage, and the only way to stick to it is to continually monitor your progress AND continually move further ahead of where you would have been.
It did work well for me, living frugally while paying down mtge faster and faster. When you get to 3 years remaining it gets exciting as you keep cutting off whole months and 'knock the b*gger off' in 20 or even 10 months.
Different for someone wanting to buy more properties, but my personal strategy was get out of debt, (to live rent-free forever), then start investing in whatever-it-might-be.
Tobo,Quote:
Tobo,
I agree strongly with this advice.
I considered myself very financially disciplined, but found it it tough at times while I had one of those credit lines. You plan to sprint paying off your mortgage, and the only way to stick to it is to continually monitor your progress AND continually move further ahead of where you would have been.
It did work well for me, living frugally while paying down mtge faster and faster. When you get to 3 years remaining it gets exciting as you keep cutting off whole months and 'knock the b*gger off' in 20 or even 10 months.
Different for someone wanting to buy more properties, but my personal strategy was get out of debt, (to live rent-free forever), then start investing in whatever-it-might-be.
To maximise a bull market you get your
second/third house's paying interest only...
... eg, The level of debt remains the same... House price
movements in those periods smash ----->
(interest paid -minus rent recieved) plus capital appreciation house equals large return... A heroic person will now
go out on a limb and return hopping on one foot... They might have trusted someone of position to lead them to the right moral
decision at that time... They might have been fooled in the last year...
A Businessman/woman housing buff will troll the market until they strike jackpot ( this is
not a realistic view for general first hombuyer)...
Mackdunk's building conterparts are once again buggering off.... quote "1967", he said...Quote:
MD-If the demand exceeds the supply due to tradesmen leaving the country which happened in 1967 when we all buggered off, look for a repeat performance.
....
...
... housing market turnaround here... I bet my future on it...
Im telling you now...This will be my most accurate pick of all time...
:cool:
.^sc
Oh, yes I understandf the idea of gearing up (OPM) in a bull ppty market.
Personal situation... well... odd.
- Bursts of big income,
- knowledge gained through working at a big international commercial bank
- both 3-year period in which I focussed on 'paying of mortgage' were not bulls, eg bought $120k ,sold for $150k some 5 years later when int rates 18 to15%, big ppty valn gain was while had no income for 4 years, followed by low income. (Career change - excellent for the soul)
Majority of my wealth is still in house (ie residential) and want to diversify (equities).
Oh, and, I now have more than a passing knowledge of the building industry (as an architect doing commercial work), and Energy/Limited Resources interests me more than building industry right now.
Not sure who I agree with on this thread (house prices gonna plateau for 2-5 years, cost of building will keep climbing big-time...which is contradictory, but both these things I think. New industrial ppty not slowing in narrow area I work, again some contradiction. There is a line of thinking that ties this together, relating income to cost of living trends over decades suggesting a gradual move back to cost of food/basics being a greater part of people's income...gradual shift in society.
Think I got too much sun today (sunny day in Auckland)
Re: tradesman
There are increasely many immigrant tradesmen, work in teams, one speaks english...many do really good work, just need supervision or managing (some don't even need that)
This will be another trend - change to greater formal education to be a "qualified" approved tradesman, and more in a supervision role over the hands-on people who do the work (and are skilled at it but don't have a piece of paper).
This model didn't work so well in the past because we had a builder who knew everything and did everything and didn't like to trust immigrant labourers to even make the tea properly, but that builder 'just knew' how to do stuff without knowing why, and probably was not interested in being a supervisor. Obviously these are oversimplified generalisations designed to offend as many people as possible (not)
In another 12 months, it could be looking good for you first homebuyers out there...
$300,000 houses on the way
The national average home sale price is tipped to drop to about $300,000 when the market bottoms out - which may not be until 2009.
LOL.... Where do the realty industry get these idiots from? Funny how the industy is still crying "wolf" and not facing up to reality.
Media to blame for slump, say real estate agents
11:50AM Monday May 12, 2008
It's the media - not the economic cycle or high interest rates driving down house prices, say real estate agents.
http://www.nzherald.co.nz/section/3/...ectid=10509561
I agree Dr Who - they were fine when the headlines were bullish but not now?
While it's obviously stupid, I do sometimes wonder the effect of the media on this. Like when the "credit crunch hit", and we started seeing effects here like drops in consumer and business confidence and such even though the problems in America barely affected us fundamentally.
"Perhaps it's time the industry began to provide its own media and look at directly connecting with customers by way of blog and email alerts and being more open with the major media by providing regular and expert insight into the state of the market"
You've got to love that last paragraph...yeah, lets get the 'experts' to tell us what the state of the market is in....because like any real estate agent would say 'anytime is a good time to buy!'
Real estate agents are not experts nor are they in a profession. They joke themselves.
I cant wait to snap up a house when real property prices have fallen 30% from their highs.
[quote=upside_umop;199564
I cant wait to snap up a house when real property prices have fallen 30% from their highs.[/quote]
upside_umop..... I think your time is coming :D
Three to six months will see a whole different market. Just save your cash and be ready to drive a bargain.
I am waiting patiently with my finger on the trigger to buy.
Oiler
i think we 'know' its coming oiler.
im thinking 2 years at least for myself - need the security of having income!
but 2-3 years isnt all that bad...there is a large lag effect with changes of interest rates, unemployment etc. the us of A is a good example of that, they're still dropping over there. it may not be 30% of the figure QV puts out..but in real terms i would hope it is that at least.
Buying houses or buying oil companies...
Hum....
...
heres a very important article...
DUNEDIN HOUSE PRICES DROP...
Dunedin is the first of the main Centres to show a drop in residential property values.
The latest quotable value figures show further signs the market is easing - but dunedin is the first area to show negative growth.
Property values there decreased .1% over the past year, with the average price just over $272,000....
....
Its now official.. House prices are down 10% from the top...
flat over the last year plus interest payments which are negatively geared...
Ouch if you did not listen...
...
....
Buff theory has told us that the market has now bottomed and going to go sideways for a few years from here...(this is going off what we have been told by one or two of the Buffs who specialise in this industry at ST)...
Realistic theory suggests otherwise...
I do agree with the buffs... bargains can be found at any time...any week... in any market..
Theres no point having a brain explosion... no need to take risks that can be eliminated by waiting...
play the game when the odds are in your favour...
Mackdunk applies this same strategy to his share investing...
YES, the two are nothing alike... same principle though...
"Its never a better time to buy than right now", we were told...
Im still abit outraged by that flippant sentence which was backed up by the kid......
Mackdunk and his gang of business representials (the buffs) will one day give it up to us and conceed they were wrong...
...
dad put his house on the market last week.....
My bedroom has never been more tidy...
:cool:
.^sc
I would be happy if my girlfriend had not put an offer in on a house recently, and then told me after she had did it!!
From the Herald yesterday:
------------------
"Alistair Helm, the chief executive of realestate.co.nz, - the website owned by the major agents, says media stories have an immediate and significant impact on buyer and seller behaviour.
His study monitored seven websites - described as "the major portals and real estate company websites" over a two year period from January 2006 until the end of last month.
Helm says he has found a correlation between a fall off in traffic to these websites with negative media stories. "
---------------------
This imbecile pretends to be a researcher. With his knowledge of statistics, I'm sure he can move from a moronic profession to being a PhD.
I've also been studying the death notices in the printed media for two years. I've concluded that the media has an immediate and significant impact on the number of people dying. I have found a correlation between the number of deaths notices and the actual number of deaths. Therefore, the media is killing people.
I had this debate with a friend of mine early this year... LOL. I am cashed up and bought some oilers and miners eg: NZO and PRC.. and he bought a rental property.
You guessed it!!! My NZO and PRC put on over 60% and yes, the property market continues to drop like a rock with dumbass realty agents tellijng everyone it is a good time to buy... ROFL HAHAHA..
The funny thing is people out there still thinks the property market is only going through a minor flat liner before it rallies again.. LOL. I am gonna pick up some really cheap property end of this year. There are properties selling below 2005 CV in good areas. Yippee.
SHREWDY, Ask your dad what he paid for the house, then the number of years he lived there, then the price its on the market. Come back to us with the percentage gain over the years, no need to quote prices. Then take into account if he rented plus the fact of the stability of owning rather than renting. He then had the opportunity of borrowing cheap money to play the market, or buy other properties. Why didnt he sell out, and play the market if the market is so good. Why is it you can borrow cheaper for property than you can for shares?. Hope your dad lets you know that property can be bought at a bargain price the same as shares, at any stage of the cycle. If your dad is selling to buy another house, then its in a similar market, so rise or falls in a falling market are in his favour.
Takes longer to sell at a lower price but whats the rush?. When he is sitting in cash in a lower market whoopee doo. Macdunk
Aren't you talking about two different types of vehicles here. Surely the oil stocks are a short term speculative while the property is a long term investment? Let's not get confused about this.
Unfortunately there is no property crash on the North Shore. I might have to settle for an ex P-lab and clean out the place.
One of my friends bought a section right at the height of the property boom. She is now having difficulty with the mortgage. Guess what she does? No, she does not sell, but instead gets a second mortgage and plans to develop the property.
Mackdunk,
Sounds like yourve put a major assignment on my hands... bugger that...
YES The historics look very good... I know the details, theres no point running you through them, I will only tell you about the present situation because Historics are insignificant... He willnot be rebuying any time shortly...
Your thought is comparable to EG, giving a presentation on New Zealand Oil now with company information of 3 years ago... Nobody invested gives a crap for what happened in the company back then... All investors care about in any market is what is going to happen now?
where is the market headed?...
should I get in or out?
These are important questions you stay clear of...
SO why do you give crap about historics?...
I can answer this question...
You have done very very well out of housing... so no matter what happens you are protected by your performance so you can at least come back when the market tanks and tell us "at least ive done well", its a protection mechanism you have which has done the newbie no good...
eg, Its never a better time to buy than right now...
Some of your advice has been quite damaging because you donot answer the important questions at hand for a newbie... this is not about finding a cheap house in any market... this is about finding a house for a newbie...
We arenot businessmen here, we are first home buyers...
big difference
You did the same sort of thing on NZO as with housing...
You dont attack the issue at hand (NZO), you fight your way around it by saying what opportunity cost plays you invested in...
what you could have otherwise done...
this doesnot get to the main issue, which is NZO....
will NZO perform or not... to be honest you never really said...
all you said was last 5 years NZO did, 'blah blah blah'...
You know NZO was a great stock, you never said it...
You are doing exactly the same here...
You are the man that people reading these threads take advice from,
People and posters want to see what you have to say...
You offer little help to those searching for answers...
Ive asked you many times, you dodge the real questions potential investors want to know which is "what shall I do with housing NOW"....
forget about the past...This has little to do with The previous 5 years, previous 10 years, previous 20 years... or in your case, the previous 55 years in the market...:D....
This is right here right now...
The past looks good, the future looks good... These two things dont matter
The present situation looks bad...
You are stuffed if you cant change with the times...
The Kid changed with the times, he sold almost everything...
What have you done?
....
I'll tell you what MD... dad would have got 615k about 5 months ago...
Now hes asking 575k... He will probably get much less...
First open home this weekend...
Come down to the national convention, while you are here come check out the house... we are looking for an escape goat...
:D
.^sc
SHREWDY, You are wrong on a few points. Firstly with your father, if it was shares he had held for years would be silly to sell in a bad market. You now say he is selling property in a bad market, and say look i told you so. If you sell to buy in any market then the odds are in your favour. If however you are selling to get out the market, then that requires you to time the market. Getting back to your point of entering the market for the first time, you will find that with a little bit of homework getting yourself organized with finance in advance of any event, you will find a bargain in any market.
I would suggest any potential first time home buyer, visit the bank or other lending agency to find out what they can borrow,against what deposit required.
Do the homework, it costs nothing, then sit in at a few mortgagee sales with your hands firmly in your pockets until you learn something. I worked seven days a week after traveling the world with no family support to fall back on if it all went wrong to get started. I drove old bomb cars just to pay a mortgage when my mates were paying their cars off. I built my own kitchen cupboards bought a second hand stove and furnished my first house out a second hand shop. I shared my first house with work mates paying rent for a year before it all came right. It never is easy at the start, delaying it is not an option if you want to get ahead. Macdunk
Properties in good areas in AK are selling below 2005 CV. I am still out of the market, cos I think this downturn will last longer then previous cycles. You only have to look over in the US property market to see that there are no signs of bottoming out yet. It is very ugly over there. The banks are holding onto 3 yrs supply of mortgagee properties they cant sell. OUCH!
Mackdunk,
I never said I told you so...
All I said was my father is selling his house and he's looking to re-enter in a few years at the bottom, period...
readdress the situation early next year...
Simple stuff really...
...
NO...Quote:
If you sell to buy in any market then the odds are in your favour.
Not in a falling market...
If you sell, and re-enter in a few years you are much better off in a falling market....pitch a tent in the local Park if need be:D
:cool:
.^sc
You are right to consider the intangible benefits of owning a home.
Some things in life aren't so cut and dry as just doing a monetary cost/benefit analysis.
Do people consider such a monetary cost/benefit analysis before having kids or deciding whether to send your kids to a private school, without taking into account the non-monetary benefits??
There are far more advantages to owning your own house than just monetary.
Think i've said before on this thread, but people who live their life as if every decision in life can be made based on an IRR calculation on a financial calculator really worry me.
SHREWDY, I will give you some numbers to work out from my own personal experience from a property i have had for the last 15 years. I bought a block of land built a house and numerous sheds etc all by the sweat of my brow.
Being a builder i did the lot myself.
I have just sold the property, so i take the agents cost and legals off then divide that figure by the purchase and material cost to see what percentage of gain that i had.
I find it comes out at 4.88. If i take the 4.88 and divide it by 15 which is the number of years i find that comes to an average gain of 32%. How many people have had a risk free average gain like that in the sharemarket over the last 15 years?. You still have not come out with your dads average gain but i feel sure its better than the 10% that i get ridiculed for quoting on this site.
Macdunk
Slight arithmetic error, if your house increased in value by 4.88x (or 488%) over 15 years your annualised gain is closer to 11.11% a year.
1.111^15 = 4.85, close enough.
Mackdunk,
I said im not quoting my dads returns because that is in the past and therefore unimportant..
Present situation not past...
Im sure we can go on and on with the success stories..
Id rather hear about who is profit taking in the housing market, and who is standing by and watching their house price fall?...
what are you currently doing Mackdunk...???
As I said My dads house is now down about 40k from the top...
Mackdunk Ive returned more than buffets average return in my first 5 years... Still up this year even with LMPO stuffed bar Otahu well and me holding 240k of them at 1.6c average...
...
Add in interest costs to your overall return aswell macky D...
:cool:
.^sc
Very good Point Hiawatha...
How many hours did you spend on this project of yours Mackdunk?
:cool:
.^sc
SHREWDY i didnt borrow to buy or build, but borrowed off and on for business reasons at a much cheaper than normal doing it any other way. Example buying and selling other property mortgagee bargains. Then take into account of not paying rent with the flexability of borrowing on the strength of it. The money that was invested in the property was not tied up dead money giving me business opportunities.
I dont care what the market cycle is, i will find a bargain in any market. You can argue all you like, but i have never known any rich person that is happy to pay rent unless its short term. I suppose being in the building trade, i meet more people that made a fortune in property than any other way. I am now looking to buy SHREWDY, let some other silly bugger do it for me this time. I would never borrow to buy shares but would borrow to buy property anytime. Macdunk
Is it possible that both the king pins are right????
The King is selling/sold up already...Mackdunk just stated he is a happy buyer...
....
How many hours did you spend on that project of yours...?
How much money do you reckon yourve lost on housing this year...?
....
:cool:
.^sc
Couple of Points. ShrewdCrude. The past is very important – for without it you have no idea where you are today relative to anything else. Also your dad hasn’t lost $40 from the top. He didn’t sell a few months ago so there is no real idea the value of his house then, as there is no real idea today.. Your views are conjecture – and a proper figure could not be realised until someone had made an offer which your dad accepted and the deal went through.
SHREWDY i have lost nothing in housing this year or any other year. I had a conditional contract on it that fell over in feb at my asking price. I have another contract on it from a retiring farmer who wants to buy at my origonal contract price. I am a very happy seller, the buyer wants the posession date in an unconditional contract to co-inside with his farm sale in four months time. Your other question about hours spent developing is easier to explain. I LUVED DOIN IT. If you have never turned a bare block of land into a beautifull living environment with trees, and birds, fish in the pond, then your time on this earth is a complete waste of time. Next house all lined up SHREWDY and its at a bargain price exactly as my indoors wants it. Macdunk
Yes the past is important, but not that important in the context of the current housing market situation...The past will give a great clue as to how far prices will fall, the Past will give an indication of where housing will be in the future, the past 5 years willnot mean that the next two years will be the same... Therefore, I see no reason to focus on historics.. Im only focused on what is happening right here right now....Quote:
minimoke-Couple of Points. ShrewdCrude. The past is very important – for without it you have no idea where you are today relative to anything else. Also your dad hasn’t lost $40 from the top. He didn’t sell a few months ago so there is no real idea the value of his house then, as there is no real idea today.. Your views are conjecture – and a proper figure could not be realised until someone had made an offer which your dad accepted and the deal went through.
I know the past is good... the only need to talk about historics is for self gratification...
Showing examples of past performance is blinding the real truth right now as everything looks totally the opposite... we are 5 months into the downturn which will last years...
Dont get suckered into great examples of a path to super normal profits...those profits will be realised, just not right now...
I will get a house, I wont rent for life...
I wont be buying, because there is never a better time to buy than right now... what a joke...
....
As to your other query...
At the beginning of the year Dad got a reasonably accurate valuation on his house... The valuation process isnot a majorly complex.... All valuations are based on a combination of value of house itself while comparing sale prices of similar houses in the same suburb, street etc...
Id say that 610k at the beginning of the year is very accurate, and the current valuation is a fair asking price... The fall in value corresponds to the fall in the overall market...
Yes he didnot get an offer at the beginning of the year...A house is only worth what someone is prepared to pay...
connect the dots...
......
Minimoke,
and yes you are right..
he hasnot lost $40 from the top...
he has lost 40k from the top...
:)
.^sc
1- Very impressive...Quote:
duncan macgregor-SHREWDY
1- i have lost nothing in housing this year or any other year......
2- Your other question about hours spent developing is easier to explain. I LUVED DOIN IT. If you have never turned a bare block of land into a beautifull living environment with trees, and birds, fish in the pond, then your time on this earth is a complete waste of time....
3- Next house all lined up SHREWDY and its at a bargain price exactly as my indoors wants it. Macdunk
2- Mackdunk you are running a business... just because you love doing something doesnot mean you do not factor labour and time into it...
I love buying oil stocks, that doesnot mean that I would do it for free...
The time invested makes up part of the return...
The more time I invest the more time I have to spot a better return/ better stock/ better opportunity to load up, (ive now done it 3 times... PPP, NWE, MEO)
Vice Versa aswell... Im shorter on time right now, and therefore I do not currently have any major rampant picks....
.
What you need to do is stack up what you could do with your time if you didnot build a house...
EG You wouldnot catch Michael Jordan Mowing His lawns, ever... He would play a game of Basketball, earn a few mill in the same time... and pay someone to do his yard work...
as you know, its called opportunity cost...
My time as an unqualified trader will some day be worth north of $50 an hour for my time and whatever the returns are...
If im not making that then Im wasting my time in this game...
3- Good luck with your purchasing... come buy in CHCH... think about it, You could come over for sunday afternoon tea and biskets...
Invitation is open...
...
Do you ever delegate others to do your dirty work?
:cool:
.^sc
Interesting thread, you are right about opportunity cost Shrewdy, I spent
4 months on our do up purchased last July which is about 10 grand based on an
average wage, but I ENJOYED IT. Then I got behind in tax as work did not
come in over the holidays but got ahead of that now have plenty of work
leading up to July when we can pay back 12 grand off principal for no cost.
Then we are going to Rotorua for a holiday as a reward.
Would not have exerted myself like that if renting as there would have been
no incentive and our 20% equity will have grown to about 30%.
We love our old do-up (nice now) with a view and great location close to main centre of
Henderson and railline and as I mentioned before, with both of us
in our 50's, if we didn't make the move now we may not have been able to
later on (while some prices seem to be down, interest rates have gone up
so we have not lost by buying a year ago at the perceived top) and we are
LOVING IT.
George
We too got a valuation at the beginning of the year from the Council. Thankfully it is $350k shy of what I reckon true market value is. In the good old days when I purchased houses requiring a valuation it was not surprising in each of three cases I recall the valuation was exactly what I was offering. And then I recall that leading question the Valuer asked.....
ShrewdCrude I can’t help but feel you are focussing too much on the picking the future. At some point you’ll realise you can’t pick the future. Don’t take this as a personal slight – its just one of those simple facts of life. If you doubt this then check out sharetrading competitions on these threads – you’ll find articulate and intelligent people well off the mark. You’ll start to hear people picking the future interests rates and hanging off fixing their mortgage for X % in X months. Its all just a waste of effort.
It appears you are unable to put a value on the intangible benefit of the enjoyment associated with being in your own home. That’s not a bad thing as I have often argued that renting is not a bad strategy either. This thread is after all about first home owners – not investors.
Oh and thanks for picking up the missing K in my previous post. Its added immensely to the discussion on this thread.
Which makes it all the more important to pick as close to the bottom as possible. Its alright when you own a house with 100% equity, but when you lay down 10% and it gets gobbled up by a declining house price, it makes it a lot harder to get ahead in the future and buy more houses. In a rising market, it makes it so much easier as you essentially gain equity which you can borrow against. You cant borrow against negative equity.
And the age old saying goes...a house is the biggest investment most of us will ever make.
This is after all a debate about new home buyers coming into ownership for the first time.
Things to do. Get a fixed rate for at least three years regardless of what you think will happen. This will allow you to keep to a budget giving you some certainty in the short term. Most working class people with lower to middle income dont play the share market or have any other means of accumulating money, other than property investment, where even a dummy can end up filthy rich with a menial task job. I know quite a few people in that position one being a fishing friend of mine, who has about six rentals no mortgage and a factory job.
He bought his first house paying a twelve pc mortgage so what are you lot bleating about?. Get out and do it, pull your finger out, the price of houses will go sky high when this is over. All the builders are fleeing the country, next time when you want to build look out. Macdunk