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Mortgagee sales reach 1-in-25 level

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  • Mortgagee sales reach 1-in-25 level

    Mortgagee sales reach 1-in-25 level

    By EMMA PAGE - Sunday Star Times Last updated 05:00 28/06/2009
    Growing numbers of Kiwi homeowners are facing the prospect of handing over the house keys, with mortgagee sales now accounting for one in 25 property transactions.
    Figures released today by property information company Terralink show mortgagee sales hit 251 in April the highest monthly total in 15 years. In April last year there were just 90 forced sales. That means mortgagee sales accounted for just over 4% of the 6210 houses that sold in April. A year ago mortgagee sales represented just 2% of the total.
    This is the fifth month Terralink has released data on forced sales in New Zealand. The numbers have been consistently higher than the previous year, reflecting the increasing pressure homeowners are under as the recession bites.
    And there is no real sign of hope in the immediate future.
    Terralink managing director Mike Donald said mortgagee sales were hitting ordinary homeowners, and 36% of forced sales were driven by the major banks. He expects mortgagee numbers to keep increasing, especially as unemployment rises.
    "There's no slowing down 251 is a pretty strong increase and when you look at the curve from December it's still accelerating upwards. There is no sign of it abating."
    Treasury has forecast that house prices will fall 12% by March next year, identifying rising unemployment as a pressure factor.
    Latest data from Statistics New Zealand show unemployment has reached 5% and is widely predicted to reach 160,000 by the end of the year.
    The increasing number of mortgagee sales was also reflected in listings on real estate sites. Realestate.co.nz chief executive Alistair Helm said the site had 375 mortgagee listings this month, compared to 325 in June last year and 98 two years ago. The keyword "mortgagee" was the number one search term by visitors to the site, which has more than 110,000 listings.
    Not all areas around the country were experiencing mortgagee sales to the same extent more than 80% of mortgagee sales were recorded in the North Island. Donald says this could be because higher house prices in the region meant larger mortgage payments, leading to increased pressure on homeowners. The median house price in Auckland is now $450,000; in Wellington it is $380,000. There were no mortgagee sales in Southland, where the median house price is $180,000.
    Auckland continued to be the worst-hit area, accounting for just under half of all mortgagee sales. There were 122 sales in the greater Auckland region in April, compared to 28 in the same month last year. Manukau and Auckland City carried the brunt of the burden, followed closely by the North Shore, Rodney and Waitakere.
    In the major centres, Canterbury recorded 27 sales (six a year ago), Waikato 25 (12), Wellington 11 (nine) and Otago 10 (eight). Bay of Plenty also had an increase with 15 sales (five). There were increases in Northland (10 sales, up from four), Manawatu (10 sales, up from nine), Hawke's Bay (eight sales up from two), Taranaki (four sales up from one) and Marlborough (three sales up from none).
    Financial experts say struggling homeowners should seek help at the first sign of trouble. Banks also encouraged their clients to contact them as soon as they knew meeting the mortgage payments could be difficult. Dealing with the problem earlier made it easier to solve
    "There's one way to find out if a man is honest-ask him. If he says 'yes,' you know he is a crook." Groucho Marx

  • #2
    Will this mean that people will start to learn what what debt is and why it is not a trivial matter or a 'right' or will the silly brigade start making a noise about how the government should 'do something' ie take from the sensible and give to the naive.


    • #3
      Originally posted by PropertyReturns View Post
      Will this mean that people will start to learn what what debt is and why it is not a trivial matter or a 'right' or will the silly brigade start making a noise about how the government should 'do something' ie take from the sensible and give to the naive.
      So when, my struggling small employer goes belly up,
      and my wife gets made redundant, we exhaust our savings,
      lose our home and move into the inlaws garage.
      I sit my kids down with a cup of thin soup and piece of dry bread and say
      "jeez have we learnt a valuable lesson today"

      yeah right

      Those statistics are actually people, no doubt some were greedy,
      stupid, naive but a lot will be ordinary people who didn't
      see the this financial meltdown coming.

      I wonder what would have happened in the US if half
      the bailout "trillions" had been used to refinance the
      foreclosures that had a chance of climbing out of debt.
      Instead we get Wall Street banks raising salaries
      whilst families live in tents.


      When I was a Boss I was a Capitalist
      Now I work for one I am not so sure. . .


      • #4
        HermanZ it's more like this:

        So when, my struggling small employer goes belly up (I told him he was a useless prick),
        and my wife gets made redundant (she only took 30 sick days last year), we have no savings because how were we supposed to know we needed them? So we lose our home ($500k, no money down - the banks lose $50k, we lose nothing but it's their fault) and move into the inlaws garage - they are lucky to have us in there paying heaps of rent, rich buggers.
        I sit my kids down with a big pile of fish and chips (I couldn't be arsed cooking) and say "It's the government's fault I lost my job, I wonder how much we'll get on the dole. Perhaps we'd better make out we're single to get more."

        And then on Monday I'll go down to WINZ and get chits for a fridge (need a beer one as well as the food one), freezer, washing machine and a big telly. Need it for the PlayStation and XBox. We'll have to see if we can get a suss Sky decoder too.

        Oh and better put our names on the state housing list too. They say once you get in one, you never have to leave. Fantastic. Nothing more than we deserve though, the government has heaps of money.

        I wonder if there are any other benefits we're not getting? Those bastards are always ripping us poor folks off. Let's see we've got the emergency benefit, the wife's (I mean flatmate's) benefit, the last of the WFF money, I know, I'll go on the sickness benefit, they can't kick you off of that and it's more I think. So free house, tick, free appliances, tick, money each week, tick, free healthcare and schooling, tick. Maybe should get the paper and look for a job, oh naaahhh, no need.

        There needs to be way more accountability by the public at large in my opinion. It's all about how much the government owes me. People forget the government gets it's money from people exactly like each of us. When the government gives you money, it's not free money, it's a bit of our own money they're giving us back. And people think they are winning this way!

        And yes I agree, they did bail out only one half of the equation (the guilty half actually) in the States, but over here, it's all about rack up the debt, do the NAP, go on the dole etc. etc. It's too easy.

        Last edited by Davo36; 28-06-2009, 03:49 PM.
        Squadly dinky do!


        • #5
          You obviously see the world in Bitmap mode.
          Two colours—Black and White.
          Gainfully employed or Dole Bludger

          My world view has 256 levels of grey.
          I've been very close to bankrupt twice (yep slow learner)
          Unemployed in London with new wife and baby (Scary place to be)
          Remember my fathers stories of wandering round the North Island
          for 18mths looking for farm work during Depression 1.0.
          Being on the bones of your arse teaches you a few things

          Cant prove it, but I'm sure a good portion of the unemployed
          are desperate for work. Sure some will be bludgers, others
          will be over fifty and no show of getting work.

          Just seems to me that reading the statistics in the first post
          and responding with "that'll learn em" lacks a bit of empathy.


          Thanks for the wind up!


          • #6
            Look, I'm sure you're right. There are people out there who are out of work through no fault of their own, who would desperately love a job and are doing everything they can to get one.

            However, there's plenty like I describe above too. Heaps in fact. I have known people like this over the years and I see them around the malls in the middle of the day now. Seems to me anyone who doesn't want to work can just coast and the govt will pay. I really believe this.

            Squadly dinky do!


            • #7
              Why does "1-in-25" seem so much more than "4%"? Whatever way I look at it, it's an alarming statistic and clear evidence that there is plenty more bite left in this recession.

              I feel sorry for those who have mortgaged up to the eyeballs and lost jobs. Most of them with time on their side will pick themselves up. For a smaller number, that's game over.

              NZ is one of the best countries for the poor (and/or unmotivated) to live in.

              The advantage of our redistribution of wealth is that that we don't have rioting in the streets over lack of food and shelter.

              The disadvantage is that the likes of Davo and I can clearly hear the government's vacuum as it sucks large amounts of money from our pockets to fund this little slice of paradise.
              Last edited by Cadmium; 28-06-2009, 08:18 PM. Reason: Splelling