An example of price drops

[essence]

I thought I'd just post a couple of examples of what is happening out in the market where I invest.

Kapiti (North Wellington)
Three bedroom property with one bedroom self-contained sleep-out, sold 04/07 $322,500 QV (1/9/05) $330K. Went to auction 3 weeks ago and was passed in @$260K. Negotiations after auction, just sold for $260K. By my calculations, vendor made a loss of $62.5K in 17 months.

Two two-bedroom units on separate titles. Originally sold 1991 for $91K & 2006 $180K, QV (1/9/05) $180K & $190K respectively. Been on market six months. Sold $198K & $192K.

The market is very quiet, with purchasers taking a long time to put in offers and then offers are low. Vendors are still dragging their feet with accepting this offers but there is now a realisation from the vendors that the market has dropped and that they can't keep holding out for last years prices.

Anybody else who has examples (good/bad) to post, please do so.

Just a general discussion, nothing too heavy please.

[Bodmin]

Also houses being withdrawn and rented

I have noticed around here that houses are not seling probably due to unrealistic expectations. I have noticed at least two houses round here where people have left the area and they have not sold so the houses are now rented. The accidental landlord phenomenum..

[Tucker]

This happened in Auckland 6 months ago.

[donna]

Article in SST today says prices will not bottom out for another 12 months. Geez this will cripple a lot of folk aye. Especially given your examples Essence. Are you seeing rents coming down in Kapiti? I had heard they are - though I thought they'd be holding firm.

Cheers,

Donna

[essence]

Hi Donna

I've got one property coming up for rental soon. I've advertised in the local rag and what I have noticed is the huge lack of phone calls. This is the first time this has happened.

Normally on advertising a property, I have between 10-15 calls. So far, I've had one.

Rental prices coming down - don't know yet. I work on the premise, that it is better to drop rental by 10/20/30 per week, rather than have it empty for 4-6 weeks.

[Hound]

I've got a couple for rent advertised on the coast right now. Yes, it has been quiet. Combined with the accidental landlord phenomenon, trade me listings are far higher than they were last year when there was an under supply. Typically winter is not a time people like to move. Great time to get purchasing, if you are able to. I've been to paper a few times recently with cheeky offers on good properties , no luck yet though. Patience will reward, I think.

[muppet]

Essence stated:

I've advertised in the local rag and what I have noticed is the huge lack of phone calls. This is the first time this has happened.

That's because so many NZers have gone to Australia, so therefore the demand has dropped.

[studio1]

New Remuera Townhouse.
Val Mar 08 (V respected bank valuer) $1.45m
Sold
900k
That's close to 40%

[cube]

That's because so many NZers have gone to Australia, so therefore the demand has dropped.

Disagree.

Although there has been an increase in numbers going to Aus 32,300 (year to July 08 ) from 25,500 (year to July 2007), NZs net long term migration is still positive (if only by a few hundred).

I would speculate that those leaving for Aus are made up of people leaving home, people who own their own home and renters, but those arriving will be more likely to rent at least short term.

There may be a combined effect of those leaving - renters leaving a rental, and home owners renting out their home (either by choice or unable to sell).

Also of note is that (in the June quarter) 28,690 deaths were recorded, so that may have added 10,000 or so homes on to the rental/for sale market (others being still lived in, or those passing on were not in their own homes) - 10,000 is a guess.

There were 64,140 births, so the population has increased, but the youngsters won't be troubling the rental market for a while (except where a larger family forces a move).

cube

[Cassandra]

Same here in welly

Hi Donna

I've got one property coming up for rental soon. I've advertised in the local rag and what I have noticed is the huge lack of phone calls. This is the first time this has happened.

Normally on advertising a property, I have between 10-15 calls. So far, I've had one.

Rental prices coming down - don't know yet. I work on the premise, that it is better to drop rental by 10/20/30 per week, rather than have it empty for 4-6 weeks.

Ive had ads placed and absoulutely NO CALLS!.Seasonal downturn plus the “accidental LL” phenomenon- lots of property offered to-let.

I get a daily listing of all latest Trademe rental ads posted overnight in the greater wellington area – often more than 50 per day!...and it’s been that way for the past couple of months

However, I also get the occasional feed-back from tenant prospects who’ve had bad letting experiences through incompetent and/or inexperienced landlords & theyve said they ‘d rather rent a property from an experienced investor / PM. PT’ ters need to promote themselves over “accidental LL” competitors and then hope that our well maintained, well presented PI’s in well sited locations pull the punters

[Propoholic]

I've got one property coming up for rental soon. I've advertised in the local rag and what I have noticed is the huge lack of phone calls. This is the first time this has happened.

I've got a couple for rent advertised on the coast right now. Yes, it has been quiet. Combined with the accidental landlord phenomenon, trade me listings are far higher than they were last year when there was an under supply.

Ive had ads placed and absoulutely NO CALLS!.Seasonal downturn plus the “accidental LL” phenomenon- lots of property offered to-let.

PT’ ters need to promote themselves over “accidental LL” competitors and then hope that our well maintained, well presented PI’s in well sited locations pull the punters

Hi essence , Hound and Cassandra
Just wondering if you had put up a To Let sign on the property in conjunction with the Trademe ad. I get 50% of calls from signs and more often than not secure a tenant from the sign. Gives the property that extra bit of promotion, especially in a soft market!

[Hound]

Actually, in the bad old days I did just that. Also used to stick notices on the mall notice board, which did get some replies.

[robbyp.]

I thought I'd just post a couple of examples of what is happening out in the market where I invest.

Kapiti (North Wellington)
Three bedroom property with one bedroom self-contained sleep-out, sold 04/07 $322,500 QV (1/9/05) $330K. Went to auction 3 weeks ago and was passed in @$260K. Negotiations after auction, just sold for $260K. By my calculations, vendor made a loss of $62.5K in 17 months.

Two two-bedroom units on separate titles. Originally sold 1991 for $91K & 2006 $180K, QV (1/9/05) $180K & $190K respectively. Been on market six months. Sold $198K & $192K.

The market is very quiet, with purchasers taking a long time to put in offers and then offers are low. Vendors are still dragging their feet with accepting this offers but there is now a realisation from the vendors that the market has dropped and that they can't keep holding out for last years prices.

Anybody else who has examples (good/bad) to post, please do so.

Just a general discussion, nothing too heavy please.

It totally depends on the quality of the house too, and demand for the particular house. I know of a house in a small subdivision in an exclusive area of Wellington, that would appeal to an elderly couple. The house is high quality and architect designed. It had a 2007 RV of 350k, and has just sold for over 400k in a private sale. If the right buyer is there, and it is a quality product, then the house will sell. Unfortionately there are too many rubbishy houses in NZ, poorly built and designed that you couldn't pay me to buy.
I think in this case, the couple just fell in love with the house, and would have paid anything, as they were cashed up having sold a larger house. You also couldn't build it for that with the land. It totally depends on who the house is marketed at.