Housing slowdown more obvious

[cube]

Oh no not more English immigrants.

Ain't nuffink rong wiv us, mate!

[whitt]

Show me the slow down guys!!!
June, July 2007 number of days to sell figures are better than in June, July 2005 & 2006.

So looking at the figures you have given us Pooomba I honestly cant see the slow down everyone is talking about.


The figures show property is selling this winter faster than in the previous 2 years. Actually nearly as fast as 2003 when the boom was going full steam.

Slow down, Cant see it in number of day figures sorry.

Are people trying to talk up a slow down when the stats don't actually show this is occurring?

Well looks like my post was not bad the latest QV report is out and the actual figures contradict what the media are reporting

August property statistics released by QV today report a 13.3% growth in national property values over the past year (calculated over the three months ending August 2007 in comparison to the same period last year). Over this period, the average sale price for New Zealand properties was $394,397.

Property is still going up in price steadily and number of days to sell are reflecting this. Faster than several years ago.

Slow down NOPE.

[Perry]

To which might be added this Stuff story:

Despite rocketing interest rates and the Government's best attempts
to rein in rampant property speculation, house prices nationwide are
still nearly $50,000 higher than they were a year ago.

Home prices rise $50,000

Interesting that the phrase "property speculation" is used. Odd, too.

[whitt]

So we have most the media ( plus Govt) and some PT members saying a slow down is happening while the stats show otherwise.

Now what will happen in the next year?

[tricky]

Big election bribes - we're going to see huges amounts of money floating around trying to win votes.
Mr Cullen will suddenly decide that 2008 is a good time to release some of that huge surplus that he's been sitting on.
Which way will house prices move next year?

[whitt]

Which way will house prices move next year?

They will go up at present rate or higher over summer period.

[muppet]

Hi Guys

A real estate agent in Tokoroa I was talking to today, tells me that the local market has made a strong comeback this month after a slow August.

Regards

[Waveindigo]

I have heard the same in Wellington, but it appears to be a strong comeback in listings rather than actual sales, so far.

[alhoon]

And cost of building is still climbing - although my window guy is very quiet at the moment and sharpening his prices, is this a sign that demand for new houses is slowing or could it mean than there are being less being built because of the increased cost?

[whitt]

OK my 2 cents:

Interest rates will increase further.

Watch this space. The market will need to be slowed quicker by more Govt intervention.

Current slow down indicators if they occur will take too long to flow into marketplace. And property values still have too much momentum behind them.

Whitt:
Daring to go against the trend.

[Hound]

Momentum

I agree with Whitt, it's all about momentum. The market is sending conflicting signals, but momentum will carry the day. Another interest rate boost will cause friction & potentially make things more interesting. I'm hoping for a big ugly slump, but it won't happen this summer. Unless the real estate concerned is of very poor quality

[roseneath_rat]

I heard on National Radio this evening that the volumes of houses selling has dropped to its lowest point since 2001.

Sale values & times on the market are also valid indicators, but volumes dropping is also a significant variable to consider.

[tricky]

My take on these figures:
Sale value - up slightly
Time on market - steady on < 30 days?
Number of sales - down a noticeable amount

So less sales than before but selling quickly and at good prices - less vendors than before but the vendors are outnumbered by the buyers.
Keen buyers and reluctant sellers.
Doesn't sound like a slump or even a flat period.

[nzfrazer]

A do-up unit in Mt Albert went on the market two weeks ago on Monday asking $375k, by the first open home on Saturday it was sold for $378k with 4 multi-offers.

Maybe the slump hasn't hit Mt Albert yet? ;-) Damn I wish it would! ;-)

[Edinburgh]

Here is another theory to explain the contradictions.

Number of listings good, but many are from people who don't have to sell and their pricing is unrealistic.

If they could sell, they would buy but they can't so they don't - a catch-22.

That type of person is a large chunk of the market and if they are not buying and selling it explains the drop in number of properties sold.

When cash buyers look at the market, they are seeing a lot of these houses. So, when they see a fairly priced house they buy it.

They don't need to see an absolute bargain, because compared to the rest of the market the house they purchase is good buying.

Because so many vendors are sticking to high prices, real sellers don't have to drop too low to catch a buyer.

That explains prices staying up.

Of course, the reason that most of the prices seem high is because of the interest on the mortgages. If interest rates were to go up even further, real vendors might need to drop from fair to good pricing to get a buyer who can afford the house.

Other things that would put further pressure on prices would be big jobs losses or a massive loss in confidence caused by another 9/11 or similar (in NZ terms, foot and mouth would do it in spades).

If interest rates come down, and some econmists have predicted that happening from March, then houses will become more affordable and everything else being equal the market should lift again.

I think drops in interest rates next year are unlikely, but people might feel a bit wealthier -eg: hike in nurses pay rates, big spending farmers - so that might lift prices a little.

If nothing much happens one way or the other we will get a little seasonal lift but I would expect prices to stabilise. There is certainly no sign of a slump.