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  • Originally posted by tricky View Post
    There's 1.3 million mortgages spread amongst 4 million people.
    You work the % out.

    The average mortgage is around $135,000.
    The average house is valued around at $350,000.
    Average LVR = 38%

    There are 1.4 million dwellings:
    - 900,000 owner occupied:
    ..... 500,000 with mortgages
    ..... 400,000 without mortgages
    - 500,000 rentals (no idea how many have mortgages)

    Not sure if this helps.

    Expat

    Sorry I am no mathematician, however these figures conflict.

    1.3 million mortgages stated, however out of 1.4M dwellings 500,000 confirmed OO plus 500,000 rental mortgages (assume everyone who owns a rental is mortgaged) adds up to 1M mortgages.

    This of course only adds up if each dwelling has only one mortgage. If not, it is difficult to rationalise (sorry no z's here) the potential values of each mortgage as you have. I could apparently hold ten mortgages over one of my properties for say five thousand dollars each. If each Kiwi did this, our total mortgages would amount to 14M. Things would look pretty laudable then.,

    Hope you didn't spend too much time working on the numbers...

    Comment


    • Woops. Two windows open at once. (Dealt to! Duplicate post removed)

      Sorry Expat, not trying to have a dig. I personally look forward to hearing your POV.

      I share many of your views and concerns.
      Last edited by Perry; 20-07-2008, 08:55 PM. Reason: Duplicate post removed

      Comment


      • We are doomed.. DOOOMED!!!! Where is the nearest foodbank.. or nuclear shelter.

        Comment


        • Originally posted by Austrokiwi View Post
          Makes sense: but I would say we have to take a range from 36-45 % drop. But is there a base assumption here that also needs to be challenged?
          Can banks continue with their current risk profiles, and obtain the funding they need?
          Also assumes banks themselves do not go under calling in loans regardless of equity - as has been happening in California...

          Comment


          • Under socialist doctrine the tax payer will bail the banks out so bank ceo cronies can enjoy the lifestyle they have grown used to

            its happening now in the states the citizens pay for the bankers and politicians malfeasance

            Im still trying to find the elusive free market not to mention the knowledge economy

            Comment


            • Originally posted by Badger View Post
              Under socialist doctrine the tax payer will bail the banks out so bank ceo cronies can enjoy the lifestyle they have grown used to

              its happening now in the states the citizens pay for the bankers and politicians malfeasance

              Im still trying to find the elusive free market not to mention the knowledge economy
              Like the "American dream"..............it (free market) doesn't exist and never will. I remember my surprise when I discovered that for 40 years Americans weren't allowed to own gold.
              Last edited by Austrokiwi; 23-07-2008, 06:03 PM. Reason: expansion
              The mission of any business enterprise should include the aim to develop economic conditions rather than simply react to them.

              Comment


              • It does exist its called the

                Black Market

                Where goods and services find there own levels where individuals decide whats worth what not some government gimp or round table cronies

                Thats why they hate it there tentacles can not fleece the participants of there money

                Yep FDR more communist than the communists

                Whats China these days

                The National Socialist peoples Republic...

                Operating like any good old Fascist state from the 1930's...

                Comment


                • Originally posted by Badger View Post
                  It does exist its called the

                  Black Market

                  Where goods and services find there own levels where individuals decide whats worth what not some government gimp or round table cronies



                  ..

                  Point taken but I think the reference was to a "Legal" free market. I recall reading once that the black market in some European Countries is larger than the regular market............from my own experience receipts in Austria can be very expensive items!!!!!!
                  The mission of any business enterprise should include the aim to develop economic conditions rather than simply react to them.

                  Comment


                  • Originally posted by Bob Kane View Post
                    Here's my 2 cents worth:

                    Assumptions:
                    1. 500,000 rentals - some without mortgages but I suspect most will have a mortgage. I'll take a stab and say 400,000 have mortgages.
                    2. Average mortgage is for $135,000 - stats from the banks.
                    3. A dwelling may have more that one mortgage.

                    Workings:
                    1. 500,000 PPORs have mortgages plus 400,000 rentals with mortgages = 900,000 dwellings with mortgages.
                    2. 1.3 million mortgages spread over 900,000 dwellings = 1.44 mortgages per dwelling.
                    3. Average mortgage is $135,000.
                    4. Average mortgage per dwelling = $135,000 * 1.44 = $194,400
                    5. Average dwelling value = $350,000 which has $194,400 mortgage and $155,600 equity. LVR = 55%
                    6. Dwellings have to drop in value by 45% before the banks get nervous.

                    Make sense?

                    Yes, much easier to understand.

                    However, while it can't be proved mathematically, at least with the information we have, my instinct tells me that the amount of equity out there is pretty small, and this means that the sweat-factor of your average Kiwi investor will be very high!!

                    Erewhon is still erehwon, I don’t see it changing anytime soon.

                    http://exnzpat.blogspot.com/

                    Comment


                    • Originally posted by watchful View Post
                      Expat

                      Sorry I am no mathematician, however these figures conflict.

                      1.3 million mortgages stated, however out of 1.4M dwellings 500,000 confirmed OO plus 500,000 rental mortgages (assume everyone who owns a rental is mortgaged) adds up to 1M mortgages.

                      This of course only adds up if each dwelling has only one mortgage. If not, it is difficult to rationalise (sorry no z's here) the potential values of each mortgage as you have. I could apparently hold ten mortgages over one of my properties for say five thousand dollars each. If each Kiwi did this, our total mortgages would amount to 14M. Things would look pretty laudable then.,

                      Hope you didn't spend too much time working on the numbers...

                      No, my math is not incorrect.

                      Dwellings: 1,400,000.00
                      With Mortgage plus Mortgages, Security Undetermined: 1,300,000.00
                      Ratio: 92.9%

                      1,300,000.00 Mortgages
                      (500,000.00) Dwellings with mortgages
                      800,000.00 Mortgages, security undetermined

                      Mortgages: 1,300,000.00
                      Mortgages, Security Undetermined: 800,000.00
                      Ratio: 61.5%

                      Take a look at trickys’s post again:

                      There are 1.4 million dwellings:
                      - 900,000 owner occupied:
                      ..... 500,000 with mortgages
                      ..... 400,000 without mortgages
                      - 500,000 rentals (no idea how many have mortgages)
                      I’ll admit it took me a while to figure it out and I see what you are saying, but I think that tricky’s comment
                      ”… (no idea how many have mortgages)…”

                      is to blame. It appears to change the meaning of the statistic. But, regardless he does state that there are 1.3 million mortgages and this is where I started.

                      So, the trick, I think, to looking at the numbers is: What is a rental? A rental is simply another dwelling and therefore: 900,000 owner occupied + 500,000 rentals = 1.4 million dwellings.

                      Of 900,000 owner occupied dwellings we have 400,000 dwellings that have no mortgage and therefore that equates to 500,000 owner occupied dwellings with mortgages and ignoring rentals (because they too are dwellings) leaves us with the equation 1.3 million mortgages minus 500,000 with mortgages which equals 800,000 other unaccounted for mortgages. What are these other 800,000 mortgages? Most likely they are a combination of 2nd and 3rd mortgages and probably lines of equity drawn from those 500,000 dwellings with mortgages. But, who really knows.

                      In my post I used the term: Mortgages, Security Undetermined to describe the mysterious 800,000 mortgages because we don’t really know what these mortgages are other than the fact that they are mortgages and therefore their security is derived in some state from the private housing sector in New Zealand.
                      Last edited by exnzpat; 30-07-2008, 12:25 PM.
                      Erewhon is still erehwon, I don’t see it changing anytime soon.

                      http://exnzpat.blogspot.com/

                      Comment


                      • latest figures

                        Overall, the total amount held on mortgages has gone up - from $149 billion in 2008 to $164 billion two years later
                        As of May 2010, there were 1,345,222 mortgages held on residential property in New Zealand.
                        http://tvnz.co.nz/business-news/kiwi...-rates-3676756

                        $164 billion in mortgages spread over 1.3 million mortgages = my calculator couldn't handle that many zeros!!!
                        But I think the average mortgage is about $110,000
                        Please correct me if I'm wrong.
                        If the average house is $350k then most home owners must be pretty happy with the current state of the property market.

                        Comment


                        • Originally posted by Bob Kane View Post
                          http://tvnz.co.nz/business-news/kiwi...-rates-3676756

                          $164 billion in mortgages spread over 1.3 million mortgages = my calculator couldn't handle that many zeros!!!
                          But I think the average mortgage is about $110,000
                          Please correct me if I'm wrong.
                          If the average house is $350k then most home owners must be pretty happy with the current state of the property market.

                          Depends on the skew............ I suspect a significant proportion of the 1.3 million mortgages are on NZ$500,000 + properties.
                          The mission of any business enterprise should include the aim to develop economic conditions rather than simply react to them.

                          Comment


                          • My PPOR has 4 mortgages currently if you include the revolving credit facility (down from 6 about 2 years ago). Average is now down to around 50k I think. I don't suppose that is typical, but it illustrates how the raw data are rather meaningless.

                            Comment


                            • From memory, around 1/2 of NZ properties are mortgage free, I believe, and there are around 1.4 million dwellings, so those 1.3 million mortgages are on around 700,000 properties.
                              DFTBA

                              Comment


                              • Are we talking mortgages or loans? One bank can have 4 loans, but these are generally all secured by one mortgage. Do these stats count mortgages or loans? If its mortgages, then Cube's stats indicate that that almost all of the 700,000 properties have second mortgages...?

                                Comment

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