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  • "Developers dropping Fat New Houses Squash Property Market"

    I can see the headline in the papers now.

    So what happens to all the these huge houses on the city limits that the developers have been working on.
    You see these new subdivisions in places like Albany, huge behemoths maxing out the site and looking real flash with their for sale signs out in front.

    They were last year selling in the high 700's and 800's but now the market has softened the developers are going to have to start clearing them, but at what price.

    I saw yesterday one with a new RV of $880,000 that had a price tag of $699,000.

    Surely this is the start of developers having to quit their properties and cut their losses, especially with the current cost of finance and ability to access it.

    Is this going to put a ceiling on older house prices and flatten house prices down overall with a ripple effect ?

  • #2
    Bluekiwi it's not the start as a lot of developers have already quit or stopped developments months and months ago.
    Nigel Turner

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    • #3
      Thought it was all go there Tucker after all you can still buy a house...

      Unfortunatly most of the garbage the developers have built is deployed in the landscape in a gimp fashion no different to the 1950's...


      Its way past its use by date surburbia...

      Comment


      • #4
        Originally posted by Badger View Post
        Unfortunatly most of the garbage the developers have built is deployed in the landscape in a gimp fashion no different to the 1950's...
        Any chance of you repeating that in english?

        Comment


        • #5
          Badger what I'm saying is that it is old news, by the time you hear about it, the worse has happened. The majority of developers stopped a long time ago but individuals are still buying and selling.

          I'm still buying and it seems many others are still buying in NZ as I have sold a couple more of my properties here to people upgrading.

          I mentioned Perth is all go the other day.
          Nigel Turner

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          • #6
            Originally posted by brettc View Post
            Any chance of you repeating that in english?
            The surburban way of life is a 1950's creation before that there was distinct difference between town and country living...

            Surburban living is a creation bought to you buy GM, FORD, STANDARD OIL, FIRESTONE TYRES & WALL ST BANKERS after WW2

            There first crack at the consumer economy and Suburban furnishing economy fell over in 1929 you may recall it as the great deppresion bought about by too much credit...the best way to get out of it was to create a War...WW2...and confiscate gold from individuals if ya were unlucky to live in the not so free UNITED States...

            The problem with suburban living is that its a energy and resource hog

            Most of the garbage built lacks in all areas just check out the leaky homes mess thats just one example of poor building and planning

            With out a car most places are islands since GM FORD and STANDARD OIL ripped out all of the public transport like trams...

            Its all in the history books...for all to see...if you can be bothered...

            GM and Ford actually got convicted of it for a $1.00 fine in the 1950's!

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            • #7
              I can't see suburban living ending overnight
              Nigel Turner

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              • #8
                I think it's the same down here in Christchurch.
                I heard an advert on the Radio for Stonewood Homes. New 3/4 bed etc etc.
                It sounded like $50 to $100k less than I'd have expected

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                • #9
                  Originally posted by Badger View Post
                  The surburban way of life is a 1950's creation before that there was distinct difference between town and country living...

                  Surburban living is a creation bought to you buy GM, FORD, STANDARD OIL, FIRESTONE TYRES & WALL ST BANKERS after WW2

                  There first crack at the consumer economy and Suburban furnishing economy fell over in 1929 you may recall it as the great deppresion bought about by too much credit...the best way to get out of it was to create a War...WW2...and confiscate gold from individuals if ya were unlucky to live in the not so free UNITED States...

                  The problem with suburban living is that its a energy and resource hog

                  Most of the garbage built lacks in all areas just check out the leaky homes mess thats just one example of poor building and planning

                  With out a car most places are islands since GM FORD and STANDARD OIL ripped out all of the public transport like trams...

                  Its all in the history books...for all to see...if you can be bothered...

                  GM and Ford actually got convicted of it for a $1.00 fine in the 1950's!

                  I hear you loud and clear Badge. I'm domiciled up in Japan and haven't driven a car to work in 10 years. In summer, I get on my bicycle; in winter, it's the train. The suburban dream is nonsense and has no place in an energy-restricted world. It's waste and inefficiency on a level that's second to none.

                  Comment


                  • #10
                    I certainly don't think the worst has happened. I still know of plenty of developers that are holding stock, hoping to make some, if heavily reduced, margin. There's plenty more to come, and soon if not already, you will be able to buy brand new cheaper than you can build.

                    With no second tier lenders remaining and finance companies not lending - there's no one to pick up the arrears from the 1st tier lenders, who have ever increasing rates of 'distressed borrowers'. The major banks are going to have to start acting, and that will be the next wave.

                    In fact - the banks should look at a product where they take an equity position, to avoid bing swamped by losses. I don't think people realised to what level 'sub prime lending' occurred here - we just haven't seen the fallout.

                    Last October one major bank was still writing wrote a huge amount of refinance and new loans at 85% LVR, with no proof of income, no bank statements and no previous mortgage history. Essentially 85% of over inflated valuations, with no other checks and balances. Watch that all come tumbling down as the petrol & commodity prices bite more people.
                    Last edited by Jurgs; 15-07-2008, 07:20 PM. Reason: clarity

                    Comment


                    • #11
                      Originally posted by Badger View Post
                      Thought it was all go there Tucker after all you can still buy a house...

                      Unfortunatly most of the garbage the developers have built is deployed in the landscape in a gimp fashion no different to the 1950's...


                      Its way past its use by date surburbia...
                      ooooh Badger thats sounds like a plug for high density living.... I like it!!!

                      Terry

                      Comment


                      • #12
                        Originally posted by tpr2 View Post
                        ooooh Badger thats sounds like a plug for high density living.... I like it!!!

                        Terry
                        And why not. HD living is perfect for modern societies. The problem I've seen in NZ is that many of the developments are poorly designed and constructed. For it to work, you need to create spaces conducive to harmony, not Stalinesque hutches of depression.

                        Comment


                        • #13
                          overnight.

                          Originally posted by Tucker View Post
                          I can't see suburban living ending overnight
                          It seems to be happing overnight in the US.
                          http://www.theatlantic.com/doc/200803/subprime
                          http://www.nytimes.com/2008/06/25/bu...=1&oref=slogin

                          Comment


                          • #14
                            Originally posted by tanmedia View Post
                            And why not. HD living is perfect for modern societies. The problem I've seen in NZ is that many of the developments are poorly designed and constructed. For it to work, you need to create spaces conducive to harmony, not Stalinesque hutches of depression.
                            I like that "Stalinesque hutches of depression"



                            Quite right though most of the stuff NZ has built is "Stalinesque hutches" Te-Papa always reminds me of U-Boat pens in France 1942 with 1960's glass and bland facade looking at the 4 lane street with a un-inviting parking island and sea of concrete to get to the sterile steel and glass doors...Compared to the the art deco 1930's building on Herd St theres just no competition in style and practical design...

                            heres a link to Jim Kunstler he has quite alot to say about the folly of surburbia etc...heres the eye sore section of the garbage they build in the States well worth a look through the gallery to get a feel for the totally backward building we do these days...

                            think leaky homes...

                            http://www.kunstler.com/eyesore.html

                            Comment


                            • #15
                              Americans are in for a little surprise it seems

                              Thanks for the Jim Kunstler link Badger, http://www.kunstler.com he writes an interesting, hard hitting AND amusing commentary. Here's an example:
                              July 14, 2008 Event Horizon


                              There's a particular moment known to all Baby Boomers when Wile E. Coyote, in a rapture of over-reaching, has run past the edge of the mesa and, still licking his chops and rubbing his front paws in anticipation of fricasseed roadrunner, discovers that he is suspended in thin air by nothing more than momentum. Grin becomes chagrin. He turns a nauseating shade of green, and drops, whistling, back to earth thousands of feet below, with a distant, dismal, barely audible thud at the end of his journey. We are Wile E. Coyote Nation.
                              Is there anyone in the known universe who thinks that the US financial system is not fifty feet beyond the edge of the mesa of credibility?
                              Nothing will avail now. Not even if Sirhan Sirhan were paroled at noon today and transported directly to the West Wing with a .44 magnum in each hand (and a taxi driven by the Devil waiting outside to take him to the US Treasury and the offices of the Federal Reserve).
                              It's hard to imagine what kind of melodramas were unspooling on the Hamptons lawns this weekend, while everybody else in America was watching Nascar, or plying the aisles of BJs Discount Warehouse for next week's supply of mesquite-and-guacamole flavored Doritos, or having flames and chains tattooed on their necks, or lost in a haze of valium and methedrine.
                              With the death of the IndyMac Bank last week, and the GSEs Fannie Mae and Freddie Mac laying side-by-side in the EMT van on IV drips, headed for the Federal Reserve's ever more crowded intensive care unit, there was a sense of the American Dream having passed through the event horizon that denotes the opening of a black hole.
                              What would happen if the US Government acted to bail out these feckless enterprises (and what if they don't)? Either way, it's not a pretty picture. If Mr. Bernanke does start shoveling loans into the GSE black hole, he'll further undermine the soundness of his own outfit and do nothing, really, to repair Fannie and Freddie's structural problem of having securitized too many loans that will never be paid back. If instead Fannie and Freddie are flat-out taken over entirely by the US government (and remember the Federal Reserve is not the government), then the national debt will roughly double overnight -- which will pound the US dollar down a rat-hole.
                              Meanwhile, the foreign holders of those decrepitating dollars might not rush to the redemption window, but they certainly would use them to buy up every oil futures contract on God's not-so-green Earth as fast as possible -- they'd be dumb not to -- which would leave American Happy Motorists with gasoline prices north of $5 a gallon, and possibly north of $10. (In that case, say goodbye to the airlines. In fact, say goodbye to what passes for the rest of the US economy, including especially the vaunted retail sector that supposedly counts for 70 percent of the action.)
                              If Fannie and Freddie are left to die out on the desert floor, say goodbye to the housing market, the major investment banks, countless regional banks, the retirement accounts of virtually everyone in America, the viability of all fifty states' governments, and the day-to-day operating ability of all their municipalities -- and very likely the current incarnation of the world banking system.
                              This process is really out of control now. The bottom line is the comprehensive bankruptcy of the United States. The Republican Party under George Bush will be known as the party that wrecked America (release 2.0). Painful as it is, Americans had better get a new "Dream" and fast. It better be a dream based on the way the universe actually works, which is to say an operating procedure run on earnest effort and truthfulness rather than merely trying to get something for nothing and wishing on stars. We might begin symbolically by evacuating Las Vegas and calling in an air strike on the loathsome place -- to register our new reality-based attitude adjustment.
                              After that, we've got to get to work re-tooling all the everyday activities of life, including the way we grow our food, the way we raise and deploy capital, the way we do trade and manufacturing, the way we go from point A to point B, the way we educate children, the way we stay healthy, and the way we occupy the landscape. I know, it sounds like a lot, maybe too much. But grok this: we don't have any choice if we want a plausible future on this portion of the North American continent.
                              Of course, none of that is likely to happen. Instead, and under the worst imaginable economic conditions, we'll probably embark on a campaign to prop up the un-prop-up-able and sustain the unsustainable -- that is, defend every status quo habit and behavior that we're used to, whether it can be salvaged or not. Of course, this would be a fatal squandering of our dwindling resources, but it it tends, historically, to be the last act of the melodrama in any faltering empire.
                              The result, pretty soon into that process, will be social breakdown and political upheaval. Every tattoo freak out there who has been prepping for his own starring role in some kind of comic book armageddon will finally get his chance to shine. Lots of people will get hurt and starve. Property will change hands in a disorderly way. And at the end of this process an American corn-pone Hitler may be waiting to set everything and everyone straight.
                              The markets open in about an hour. Good luck everybody.

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