Loving the channel! Great to see some property insights in Nz. I studied a lot of this sort of stuff in Uni, I think the so-called downturn will continue on for another 6-18 months +. There'll be some masking though with green shoots (i.e regions having 1% increases and 1% falls like a see saw that is ongoing) and quality properties selling well but if we look at the price increases over time and the relative spikes including 20-40% a year in the last few years in some regions (e.g. Wgtn etc) and compare this to household earnings (averaging like 100k vs 1m average quality property in Nz) it's all completely unrealistic to expect a continuation. Look at each decade from say 1980 and weightings as proportions in terms of price increase including the spikes in 2020-21 which was a significant portion of the increase over the last 20yrs - would account for not too far off 50%. If you give the decades weightings it makes sense that a huge increase would be followed by an extended flat to falling line. Given Torque (turning motion) = force x distance in physics and everything balances. Expect 5-10 years of stagnant to little price movement on average across Nz unless significant stimulus from the gvt. Chch is playing catch up as nth island prices went up the wall up until end 21, as it has done like dunedin and that will level off in the next little while or is already starting to slow. Look at wgtn for e.g. and maybe even akl . Wgtn is going to take years to turn around eco and housing environment and akl leads the way in nz but even there the debt levels are so high that it will take a long time to fix. Markets like aus houses are a different topic altogether with huge price spikes but will expect to see huge corrections in the next 1-3 years accordingly. Ive seen some channels of property promoters over there that only look about 30-35 buying many properties but will get a huge shock moving forward with massive debts, all it takes is a international shock to flip the coin. The 'buy as many properties as you can' mindset to keep up with your neighbour mentality in Nz and for retirement and all mum and dad investors buying at peak which is basically just created overwhelming levels of debt and has led to a total rethink of what is the purpose of a house in nz are fundamental and key factors and will impact everywhere abroad. People took equity out of their houses to buy more and not only have both properties dropped value but the 'investments' will require selling and will have taken equity out of their primary houses and that will take a lot of time to correct given the crazy spikes and borrowing at unrealistic prices. Love to hear your points but there has been so many factors leading to the current ''state'' of nz that the feeling is realistic
Hi @Kiwisnrl, thanks so much for the comment and great insights you have. We will definitely look to touch on the some of the topics in our October video, such as household earnings vs house prices. Thanks!
@@najibrealestate929 No worries mate. Just thought I would summarise a bit of my jargon below as it's much harder to write comments vs having a property conversation. When I refer to 'torque' and physics, just think about a graph like economic cycles with boom (bull) and bears on a graph but as like force and distance(time). Forces via values between 2019-2021 going crazy over a short period of time and unique/unrealistic circumstances with huge influx of mid-high skill workers returning home from lockdowns compounded by low int rates. Not to forget balanced by inflation which has reduced purchasing power of every dollar over last 20 years. So to balance such a rare event expecting balancing forces via long/subdued outlook following as was leading up to. Also migration of younger skilled workers which would have a compounded benefit over the next 5-10 years leaving country for 'better' opportunities and pay abroad which would be expected to recirculate into Nz in >10 years time after they return financially sound. This idea goes very well with the ageing population we have and how they generally have the properties and all that value tied up which creates unrealistic mortgages/expectations for younger people which is where we are at. Look at say Wanaka, in-line with the price spikes and growth of like 40% in 2021, but most there that own 'value' in terms of equity are old and little debt vs now becoming stagnant as unrealistic mortgages and price expectations. This also goes hand in hand with the 30-45 age bracket who are newer to the housing market where they are all after 'forever home' so enter market with 1M-2M mortgage similar story to the multi property owners in this age bracket using paper gain equity to buy more and more property til they are 'billionaires', no surprises whatsoever that in the next decade the house of cards so to speak will fall down if it hasnt already as will be seen in Aus and all it takes is a light wind (global shock, job loss etc and its down down) - My advice is and always be a key economic principle like a monopoly or oligpoly or one of those 'poly' terms- old days of stock market/investing in property - when very few do it, everyone wins, when everyone does it there is no longer profits to be made and losses. And the 'forever' home idea, thats the next problem :45 year olds + had entry into market that was cheap and have multiplied their equity, theres a massive problem now that people aren't entering at 300k-500k like 15 years ago, theyre entering at >1M (most is debt) and expecting prices will increase at some multiple like 2,3,4 x. I remember seeing a video by the Ed guy at Opes with how much will prices increase and it showed now e.g. house worth 1M and say 2060 with a price of like 70M clickbait. All these people have an agenda and need to push it, these people dont understand everything is based on fundamentals. Something like 99% of economic predictions for the last 10 years have been wrong, accompanied by ageing population which is where most of the wealth is with the majority unable to go and buy the 100k house from 1990 for 3M+ now and most taking on huge debts to think theyre going to hop on the train. Its near impossible. Akl is at the tipping point with debts so high seeing prices decline massively and expect Akl to lead bounce back, with auctions there at like 1 in 5 properties selling it could be at least 2-3 years til they lead the turnaround unless massive stimulus. At that point the nrth island will at some date later in time will follow as did in 2010-2017. In terms of buying good property, something like Qstwn, home and income type set up with value created to hedge mortgage.
Hi Thomas, We still feel there is further to go for NZ House prices. We'll be releasing a video on this in October and will go into detail why we think this. Thanks!
Hi Jason, Thanks for your question. You can find a 3-bedroom house with a decent land size (600sqm+) in suburbs like Woolston, Linwood, older parts of Halswell, Hoon Hay, Shirley, and Richmond. With a budget of $600k, the market is becoming more affordable, and we still feel Christchurch house prices will drop further in the next six months, which could make real estate more accessible. For instance, in Casebrook, a client recently purchased a property in the late 500s. He plans to make some minor improvements-carpets, curtains, and landscaping-before renting it out long-term. We think it's a solid investment opportunity. You can check out the listing here: www.raywhite.co.nz/canterbury/christchurch-city/casebrook/BGN32453/. The suburbs above did experience some earthquake damage, it's crucial to thoroughly check the status of any repairs or unresolved issues before making a purchase in Christchurch. Hope this helps!
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Loving the channel! Great to see some property insights in Nz. I studied a lot of this sort of stuff in Uni, I think the so-called downturn will continue on for another 6-18 months +. There'll be some masking though with green shoots (i.e regions having 1% increases and 1% falls like a see saw that is ongoing) and quality properties selling well but if we look at the price increases over time and the relative spikes including 20-40% a year in the last few years in some regions (e.g. Wgtn etc) and compare this to household earnings (averaging like 100k vs 1m average quality property in Nz) it's all completely unrealistic to expect a continuation. Look at each decade from say 1980 and weightings as proportions in terms of price increase including the spikes in 2020-21 which was a significant portion of the increase over the last 20yrs - would account for not too far off 50%. If you give the decades weightings it makes sense that a huge increase would be followed by an extended flat to falling line. Given Torque (turning motion) = force x distance in physics and everything balances. Expect 5-10 years of stagnant to little price movement on average across Nz unless significant stimulus from the gvt. Chch is playing catch up as nth island prices went up the wall up until end 21, as it has done like dunedin and that will level off in the next little while or is already starting to slow. Look at wgtn for e.g. and maybe even akl . Wgtn is going to take years to turn around eco and housing environment and akl leads the way in nz but even there the debt levels are so high that it will take a long time to fix. Markets like aus houses are a different topic altogether with huge price spikes but will expect to see huge corrections in the next 1-3 years accordingly. Ive seen some channels of property promoters over there that only look about 30-35 buying many properties but will get a huge shock moving forward with massive debts, all it takes is a international shock to flip the coin. The 'buy as many properties as you can' mindset to keep up with your neighbour mentality in Nz and for retirement and all mum and dad investors buying at peak which is basically just created overwhelming levels of debt and has led to a total rethink of what is the purpose of a house in nz are fundamental and key factors and will impact everywhere abroad. People took equity out of their houses to buy more and not only have both properties dropped value but the 'investments' will require selling and will have taken equity out of their primary houses and that will take a lot of time to correct given the crazy spikes and borrowing at unrealistic prices. Love to hear your points but there has been so many factors leading to the current ''state'' of nz that the feeling is realistic
Hi @Kiwisnrl, thanks so much for the comment and great insights you have. We will definitely look to touch on the some of the topics in our October video, such as household earnings vs house prices. Thanks!
@@najibrealestate929 No worries mate. Just thought I would summarise a bit of my jargon below as it's much harder to write comments vs having a property conversation.
When I refer to 'torque' and physics, just think about a graph like economic cycles with boom (bull) and bears on a graph but as like force and distance(time). Forces via values between 2019-2021 going crazy over a short period of time and unique/unrealistic circumstances with huge influx of mid-high skill workers returning home from lockdowns compounded by low int rates. Not to forget balanced by inflation which has reduced purchasing power of every dollar over last 20 years. So to balance such a rare event expecting balancing forces via long/subdued outlook following as was leading up to. Also migration of younger skilled workers which would have a compounded benefit over the next 5-10 years leaving country for 'better' opportunities and pay abroad which would be expected to recirculate into Nz in >10 years time after they return financially sound. This idea goes very well with the ageing population we have and how they generally have the properties and all that value tied up which creates unrealistic mortgages/expectations for younger people which is where we are at. Look at say Wanaka, in-line with the price spikes and growth of like 40% in 2021, but most there that own 'value' in terms of equity are old and little debt vs now becoming stagnant as unrealistic mortgages and price expectations. This also goes hand in hand with the 30-45 age bracket who are newer to the housing market where they are all after 'forever home' so enter market with 1M-2M mortgage similar story to the multi property owners in this age bracket using paper gain equity to buy more and more property til they are 'billionaires', no surprises whatsoever that in the next decade the house of cards so to speak will fall down if it hasnt already as will be seen in Aus and all it takes is a light wind (global shock, job loss etc and its down down) - My advice is and always be a key economic principle like a monopoly or oligpoly or one of those 'poly' terms- old days of stock market/investing in property - when very few do it, everyone wins, when everyone does it there is no longer profits to be made and losses.
And the 'forever' home idea, thats the next problem :45 year olds + had entry into market that was cheap and have multiplied their equity, theres a massive problem now that people aren't entering at 300k-500k like 15 years ago, theyre entering at >1M (most is debt) and expecting prices will increase at some multiple like 2,3,4 x. I remember seeing a video by the Ed guy at Opes with how much will prices increase and it showed now e.g. house worth 1M and say 2060 with a price of like 70M clickbait. All these people have an agenda and need to push it, these people dont understand everything is based on fundamentals. Something like 99% of economic predictions for the last 10 years have been wrong, accompanied by ageing population which is where most of the wealth is with the majority unable to go and buy the 100k house from 1990 for 3M+ now and most taking on huge debts to think theyre going to hop on the train. Its near impossible. Akl is at the tipping point with debts so high seeing prices decline massively and expect Akl to lead bounce back, with auctions there at like 1 in 5 properties selling it could be at least 2-3 years til they lead the turnaround unless massive stimulus. At that point the nrth island will at some date later in time will follow as did in 2010-2017.
In terms of buying good property, something like Qstwn, home and income type set up with value created to hedge mortgage.
2025 will be an interesting year for real estate. Looks like Wellington may be in the doldrums for a while. Great info thanks
What you bet that 1990 townhouse had monolithic cladding directly fixed!
Are we out of the bottom now？
Thanks！
Hi Thomas,
We still feel there is further to go for NZ House prices. We'll be releasing a video on this in October and will go into detail why we think this.
Thanks!
@@najibrealestate929Thanks
Great work and looking forward to it！
Is it possible to find a 3br house with decent land size (600sqm+) in these suburbs except Dallington? Any concern on EQC pending work? Thks.
Hi Jason,
Thanks for your question. You can find a 3-bedroom house with a decent land size (600sqm+) in suburbs like Woolston, Linwood, older parts of Halswell, Hoon Hay, Shirley, and Richmond. With a budget of $600k, the market is becoming more affordable, and we still feel Christchurch house prices will drop further in the next six months, which could make real estate more accessible.
For instance, in Casebrook, a client recently purchased a property in the late 500s. He plans to make some minor improvements-carpets, curtains, and landscaping-before renting it out long-term. We think it's a solid investment opportunity. You can check out the listing here: www.raywhite.co.nz/canterbury/christchurch-city/casebrook/BGN32453/.
The suburbs above did experience some earthquake damage, it's crucial to thoroughly check the status of any repairs or unresolved issues before making a purchase in Christchurch.
Hope this helps!