As a challenging year draws to a close it’s timely to reflect on where 2012 might take us. Nothing is more certain than just as the economic conditions across the world are variable, so are they in the many different areas of New Zealand. On the world scale, NZ is as well protected from global financial changes as any nation on earth. Sure, there will be tightening of some belts should prices gained for our dairy, meat, wool and forestry products….but nothing like the angst Australia will go through when China and India slow down use and purchase of coal and ores!
Within NZ there is marked regional variation in real estate markets…and that’s the point really. Anything that any soothsayer says about “The NZ Real Estate Market” is going to be totally wrong for over half the country. Yes, we are that variable. So, the word for 2012 must be “Local.”
Meantime, have a great Festive Season and if you’re off duty….enjoy! If you’re on duty….enjoy!
1. Holiday house hunters are typically serious home buyers
2. Many interstate and international buyers relocate and buy over this period, with a view to settle in for the beginning of the New Year
3. Inspections may be easier than you think if you are planning to be away during this time… your home is always ready for inspections without effort!
4. Many of your neighbours will be having family and friends over. If they love the neighbourhood and see your “For Sale” sign, you might get some interested buyers
5. Your house will smell amazing with all the yummy cooking aromas
6. End of year bonuses often get used as part deposits: a great time to get them interested, while they have the money
7. People are generally happy during the holiday season – happy people = happy buyers
8. The majority of people think now is a bad time to sell and don’t list their property for sale, this means you have less competition!!
9. Your garden and yard always look lush, green and inviting at this time of year, and all the festive lights in the neighbourhood make it even more enticing
10. Lastly, you could always try asking Santa for a ready, willing and able buyer….
Rising house prices are not deterring first homebuyers from entering the market. Helped by low interest rates, the current wave of first homebuyers was the first of a savvy home buying group, BNZ’s chief economist Tony Alexander says.
“I think we’re just seeing the first wave of canny first homebuyers entering the market at the moment, they see the discussion about growing housing shortages, prices that are already rising and once we get the labour market being a lot stronger next year we’ll get a lot more of those buyers coming forward. I think this trend will continue and strengthen,” he says.
Commercial real estate is carefully moving forward…though the Justice Dept’s decision last week to close six courthouses for quake proofing has sent a major alarm bell off in that sector.
What signal is that sending other commercial owners in the cities and towns concerned?
The improvements could cost more than some buildings are worth…and where will insurers sit?
We watch and wait….
Prof Michael Enright, regarded worldwide as an authority on the structure of local economies, changes required and the world in general, comments on NZ’s future from where he sits.
It’s worth noting though, that many see his views as being similar to the ‘Economist’s” report yesterday that suggested NZ and nine other majors will and need to see their residential property prices drop by 25%. I recall the World Bank advising Fiji, back in 1975 when my family resided in Suva, that the new Queen’s Road from Nadi to Suva should be an eight laner! In fact, the World Bank wouldn’t lend on it unless it was.
It wasn’t, they did and it remains more than sufficient. So read Prof Enright with an ‘open’ mind!
Some good news this past week came from the NZCER’s CEO, Shamubeel Eaqub, in his quarterly review of the country’s performance along with predictions of downstream results of the Euro crisis.
In short, he is of the view that NZ’s export focus on food products and the Asian market will hold us in good stead should the global economy slow although quite obviously we will endure a drop in overseas income which will slow our internal economy, Eaqub is of the view that interest rates will not be raised in NZ until mid 2013 and that sometime in the first quarter of 2012 we may well see a lowering of the OCR in an attempt to stimulate activity …dependent upon retail and manufacturing volumes between now and then, along with the cost of overseas money.
SO, those first home owners who are secure in employment and wish to take advantage of presently well priced property may well be able to budget low rates well further ahead than previously anticipated. Watch the banks for any further shifts in rates…Fixed 3 – 5 years are getting more and more competitive.
The Dunedin Council just set aside $350 million for the next two years to look after Dunedin’s interests in support of the rebuild process in Christchurch.
Seems the department will endeavour to source materials and services in answer to the rebuild requirements, from Dunedin and Otago. They’re also working with the Port there to assist Christchurch with bringing in heavy materials given the Lyttleton is, well, stuffed as a port and fighting with their insurers right now to establish cover limits for the rebuild.