Don’t get your hopes up yet, say property commentators
Jazial Crossley | Friday August 14 2009 - 12:28pm
Today's Real Estate Institute figures showing house prices increased by 2.2% in the three months to July have added weight to Infometrics claim that house prices will rise by 24% over the next three years. However, some property analysts say the forecasts are far fetched and overly-optimistic.
While many commentators have been delivering differing reports of how they expect the property market to pan out over the next few years, the majority agree next year won’t be hugely improved on the current situation.
The data that Infometrics based its report on is calculated by median prices of homes sold, and property market commentator Kieran Trass said that method is unreliable due to including the extreme ends of the market.
He predicts a nominal fall in house prices instead. The main problem facing the residential housing market in New Zealand is affordability, he said.
At a property market outlook presentation at the University of Auckland, interest.co.nz editor Bernard Hickey told the audience of largely 18-30 year old students to leave New Zealand, because property would never be affordable in their lifetime.
“If you are under thirty and don’t own a home, there is no hope for you in New Zealand. If you think you’re going to be able to get married, have kids and own your own place with a back yard, it’s not happening – especially not in Auckland,” Mr Hickey said.
He blamed the property purchasing patterns of the baby boomer generation for the inflation on residential prices
House prices are already “horribly unaffordable”, he said, adding that by 2025 the baby boomers who bought up large in the property market between 2003-2008 thanks to generous bank lending will be pushing up tax rates by putting pressure on the healthcare system.
Realestate.co.nz chief executive Alistair Helm held a conservative outlook. He said at the same presentation that he expects the next five years to be dull in the property market.
“Sales volumes are likely to grow steadily,” Mr Helm said. He added that supply would be restricted due to limited new builds but the flow of residential construction would return.
Mr Trass, who runs the website suburbwatch.co.nz said that we are now in the middle of the housing slump, with the current rise in new listings and lifted mood in the industry being nothing but a false start. He expects a somber mood to be prevalent in the property market during 2010.
Jazial Crossley | Friday August 14 2009 - 12:28pm
Today's Real Estate Institute figures showing house prices increased by 2.2% in the three months to July have added weight to Infometrics claim that house prices will rise by 24% over the next three years. However, some property analysts say the forecasts are far fetched and overly-optimistic.
While many commentators have been delivering differing reports of how they expect the property market to pan out over the next few years, the majority agree next year won’t be hugely improved on the current situation.
The data that Infometrics based its report on is calculated by median prices of homes sold, and property market commentator Kieran Trass said that method is unreliable due to including the extreme ends of the market.
He predicts a nominal fall in house prices instead. The main problem facing the residential housing market in New Zealand is affordability, he said.
At a property market outlook presentation at the University of Auckland, interest.co.nz editor Bernard Hickey told the audience of largely 18-30 year old students to leave New Zealand, because property would never be affordable in their lifetime.
“If you are under thirty and don’t own a home, there is no hope for you in New Zealand. If you think you’re going to be able to get married, have kids and own your own place with a back yard, it’s not happening – especially not in Auckland,” Mr Hickey said.
He blamed the property purchasing patterns of the baby boomer generation for the inflation on residential prices
House prices are already “horribly unaffordable”, he said, adding that by 2025 the baby boomers who bought up large in the property market between 2003-2008 thanks to generous bank lending will be pushing up tax rates by putting pressure on the healthcare system.
Realestate.co.nz chief executive Alistair Helm held a conservative outlook. He said at the same presentation that he expects the next five years to be dull in the property market.
“Sales volumes are likely to grow steadily,” Mr Helm said. He added that supply would be restricted due to limited new builds but the flow of residential construction would return.
Mr Trass, who runs the website suburbwatch.co.nz said that we are now in the middle of the housing slump, with the current rise in new listings and lifted mood in the industry being nothing but a false start. He expects a somber mood to be prevalent in the property market during 2010.
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