Auckland House Prices fall 4 percent

[artemis]

..... But comparisons using median prices seem to me to be almost deceptive.

I don't recall it with any great accuracy, but someone once mentioned that - using the median index - if Bill Gates moved to NZ, approximately a million people would immediately be below the poverty line.

Lies, damned lies, political promises and statistics, eh?

The Bill Gates story is much more likely to refer to averages, income, wealth. Because median means half are above and half below. And Mr Gates still only counts as one LOL. Not uncommon to remove the outliers, such as the bottom and top few % before calculating average or median.

I think CoreLogic reports a stratified median for its paying customers (takes account of different types and locations of home).

[Perry]

Maths is not and was never my strong point.

I understood that the median point was the middle price point between the top and the bottom, as you say. But the idea that the mid point is an average makes sense to me, too.

Therefore, if there were 100 house sales in a month, the median price for that month might be (say) half a million dollars. But if that month's stats included one or two McMansions from Remmers selling for multi-millions, the median [price] point would move up, wouldn't it? If so, more house sales would be below the median price.

By that measure if Bill Gates or Geoff Bezos or Richard Branson moved to New Zealand they would - by their very presence - plunge 100s of thousands of kiwis into poverty.

[artemis]

Hi Perry. No, the median is just the price point at which half the sales are above and half below. So in your example 50 are above the median and 50 below.

But the average sale price would change.

I don't think 'median' is well understood out there in the real world. Tell people the median house price in say Auckland is $850,000 and that number gets scarily fixed in their head as what it costs to buy there. Yet half of sales are under that amount. Some will be well under.

[BlueSky]

30 percent fall in Mt Albert - do they even read what they write!!!!

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12224884&fbclid=IwAR2gLSVgXFKH8rceYBYVpM3Yn0oM8GpsMiRIROOh9j9SUHyU2VTGB-588AU

[McDuck]

Maths is not and was never my strong point.

I understood that the median point was the middle price point between the top and the bottom, as you say. But the idea that the mid point is an average makes sense to me, too.
...

Yea, I think its the way they taught it at school.
All those math books with those perfectly spaced grid patterns and all those rulers with those uniform inches or millimeters.
And all those equations that are oversimplified, so that you can do them in your head.

In the real world, there are strange uneven gaps between the grid lines , none of the inches or millimeters are evenly spaced ..and the numbers never end up as whole number answers.

so yea, the training leads to strange expectations and poor judgment.

[McDuck]

I thought of a good example.

Say you have a quiet beach town.
There is a street with ten houses.

Five on the beach view side, five behind those.
They are all cheap batches.

A few x prime ministers and a few broadcasters etc decide to buy four of the beach side properties, they build four McMansions there.
So the median fifth property is worth 300K ( for arguments sake) while the average price is more like 1 million.

300K or 1 million?
Which is the more accurate representation?

[flyernzl]

Depends what you are trying to prove.
Figures don't lie but liars can figure.

[McDuck]

Depends what you are trying to prove.
Figures don't lie but liars can figure.

I sort of look at it the other way.

All numbers are wrong, well at least in some respect.


I could get a better picture of the situation by having three numbers.


Lowest price, highest price and middle price.

But an even better picture with four numbers, high, low, middle and total.

[Bluecoat]

Mount Albert experienced the largest drop, with the median house price falling 31.2 per cent to below $1m.

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12224884

good grief , nzherald....

[Perry]

Get Over It!

Mount Albert experienced the largest drop, with the median house price falling 31.2 per cent to below $1m. Good grief, NZ Herald . . . .

What does it matter if it's 4 or 14%? If the rent's still being paid and the bank isn't nervous about debt/equity ratios, it's just a number from Questionable Value or the totally objective REINZ or some other digital soothsayer.

Now, moving right along . . .

[Bluecoat]

I am looking at buying and that is not what i am seeing Perry.

[Perry]

My comment related to an existing buy-and-hold residential rental.

[flyernzl]

Unfortunately, so many were sucked into buying a 'tax efficient investment' where they were losing a pile of actual cash money every month.
This nightmare only being made palatable by the thought of those juicy untaxed capital gains that we hear so much about.

Now that those have evaporated . . .

[Chris W]

Unfortunately, so many were sucked into buying a 'tax efficient investment' where they were losing a pile of actual cash money every month.

FYI, in the 2016/2017 tax year, there were 116,000 tax filers claiming losses on residential real estate leasing operations.

[Perry]

Well rich ones ... you have to pay $300pw+ to rent a craphole in Invercargill .. NZ living is very unaffordable unless you're on a good income or happy to be in bunk beds with other per room
Oil prices looking to spike ... NZD showing weakness .... $3lt fuel more inflation to come ..

Well, here we are, approx. six months later.

How's it all looking, folks?