Bernard Hickey: "Methinks they dost protest too much"

[drelly]

Landlords have come out today all guns blazing against the collection of tax reforms suggested yesterday by the Tax Working Group. Property Investors Federation Vice President Andrew King described the changes as an "orchestrated attack" that would unleash a mass exit from the industry.

Read the rest

[k1w1]

Ole' 30% Hickey is really nailing his stake in the ground over this one.

[drelly]

Yep, I can almost see him frothing at the mouth while writing that!

I'm really struggling to see his articles as genuine any more. My impression is that he's writing for effect more than because of his beliefs. There's just too much hysteria, rhetoric and hyperbole to take him seriously. It might work on his followers but not for me.

He's still trying to blame investors for high property prices despite all evidence to the contrary and seems convinced that taking to PI's with a bat will somehow take us back to the good old days!

[downturn9]

An era is ending for the property investors. They need to accept the glory days of tax-free capital gains driven by credit-fueled speculative fervor are over. They need to get back down to the business of making sustainable yields on rental properties with real people in them.
It's time to pay the ticket Mr King.

That really makes investors not happy, doesn't it?

However, looks like he does make some sense? The change could really improve NZ active productivity.

He's still trying to blame investors for high property prices despite all evidence to the contrary and seems convinced that taking to PI's with a bat will somehow take us back to the good old days!

Drelly so what do you think that contributed the biggest portion to the high property prices?

[drelly]

However, looks like he does make some sense? The change could really improve NZ active productivity.

How? Given that he's blaming the *very recent* surge in landlord numbers, if we went back to say.... 1999 were we so much more productive then???

Drelly so what do you think that contributed the biggest portion to the high property prices?

Property price rises was a global phenomenon. No one seems to be suggesting that it was investors that created the bubble globally but Bernard seems convinced we're to blame here! The difference here is that our banks haven't been going under like the have in the US and Europe.

It wasn’t mainly investors buying up the new and very expensive houses and lifestyle blocks! Aside from my last PPOR (now a rental), my newest rental was built over 20 years ago! I was able to buy them because home buyers were rushing into their new 3-4 bedroom brick and tiles as fast as the banks could lend them money. If anything it was investors buying all the old and cheap property stock that allowed the homebuyers to upgrade into the newer, more expensive homes. We benefited but we didn't start it.

[Avalon]

They need to get back down to the business of making sustainable yields on rental properties with real people in them.

He thinks tenants arent real people???

Nice

[k1w1]

Nah, he thinks we're all so evil that we make up virtual people as tenants in our properties, then claim welfare handouts for them.

[WBuffett]

He has to get people visiting his website somehow,(www.interest.co.nz visit it now to go in the draw to win a free prize) hits = $ or something like that, and hes not going to get those hits by being non-controversal and non-confrontational. I wouldn't worry about it, he and his readers don't take it too seriously so why should we.

[Jumpin]

The "credit-fueled speculative fervor" was made possible by an excess of lax lending by various speculative lenders.

Contrast the recent property boom with the 1980's share market boom and 1987 crash. It took NZ years to get over that, yet that is what the tax working group would prefer. If we now have a bunch of over-priced housing, at least it supported the construction industry to update and grow the housing stock in the meantime. And dont forget- many residential investors graduate to commercial property and beyond, impacting the economy beyond the shortsightedness of Hickey. I seem to remember in 1987 all we were left with was worthless pieces of paper, that were once share certificates.

[mortgage broker]

Hey I have a good idea to increase productivity, why don't we decrease benefits or income top ups for those on lower incomes. And decrease their taxes.

This will mean you get more for what you work for. I mean you would have to be stupid to work 40 hours if working 20 hours plus benefits will get you the same money.

Also there might be less of a cash economy, people may declare income, which although not taxed heavily will mean that they do not have to claim benefits.

[PeterEmpowerEd]

Holy cow. I don't read many of Bernard's blogs but that one's a humdinger... he is really winding people up, isn't he, Dave?

Best lines: "If they were irrational before, they'll stay irrational." Ha!

And "Landlords made at least NZ$100 billion worth of capital gain over the last 8 years. They can afford it." closely followed by "...This is something I learned (!) after making my 30 per cent house price prediction (now revised to a 15 per cent fall)"

... so, having established his credibility at forecasting, this: "At best the collection of tax changes possible in this budget are likely to drag prices down only slightly (less than 5 per cent is my pick)."

Groan.

As for the implausible demonisation of Andrew King, well, silly.

[drelly]

Hey Peter,

This particular blog hasn't appeared on www.interest.co.nz yet. Perhaps he realises he went too far?

[PeterEmpowerEd]

Hey Peter,
This particular blog hasn't appeared on www.interest.co.nz yet. Perhaps he realises he went too far?

Hmm... Self-awareness? THIS early in the evolutionary cycle? Neh, unlikely. (Bernard: it's a joke!)

Seriously Dave, there's no such thing as 'too far' ... Bernard and others I've spoken to about this at interest.co.nz (even this afternoon) know that part of the 'game' is garnering free publicity ... the more contention and uproar the better.
And by THAT yardstick, he's doing really well. (To his own astonishment, at times, he tells me.)

And I don't mean that cynically -- they've got big broad grins on their faces... we may as well have a 'larf' too.

They're rarking us up. See Olly's comment about the politicians 'watering down' phase ... coming to a smoke-filled room near you.

[american_psycho]

methinks the same idiots who lost money in the 87 crash are the same idiots that are knee deep in property now (maybe its the children of the 87 crash victims - perhaps a genetic link? maybe this cycle will repeat with another asset class in 20 years time).

[PeterEmpowerEd]

Weeell...

"knee deep in property" isn't the problem, surely? ... It's those who are "up to their neck in debt" who could have some, er, issues.