Glorious 2 bed home...

[gjm 3193]

My view on affordability is probably slightly skewed. In the UK, maximum mortgage lending is calculated based on income, as it is here, but the upper limits tend to be around 3.5x, and not 5+. Difficulties with getting on the ladder are much the same, and while I have been thinking housing prices may be lower, I'm probably comparing a more regional figure with that of one of the fastest growing cities - Auckland.

As for the sale of first time buyer homes - conversations recently with more rural agents (who will still have a better view of what is going on in the city than I do) suggest that the sale of ftb-type homes has barely faltered. The difference is that investors, speculators and landlords are stepping in, waving wads of cash leveraged off their current property portfolio, and snapping up ftb properties whenever possible, typically at well below advertised price. They can do this because a sale is a sale, and the real ftbs can't get the funds together.

I think it was the governor of the RBNZ who suggested the problem with lowering the deposit requirements now would cause a sudden influx of buyers, and push prices even higher. Of course, had the 20% deposit threshold not been instigated, we might not have the log-jam we currently do! Or, conversely, maybe we'd be worse off... I'm not an economist.

The new CVs are interesting. Realtors have for some time been citing that CVs are out of date and bear no relevance to property prices, and that buying at 30-60% over CV represented good sense because the CVs were going to change, and dramatically, upwards. That has happened in some areas, but much of Franklin has seen little change in CV. So the realtors are saying the properties are even more of a bargain now that the councils have undervalued them!

I think I need to get on that bandwagon. Just need to exorcise my soul, first.

[E30 325i Rag-Top 2914]

The lending in the UK has been cut back drastically after the last crash, too much over lending. I was once asked three questions for a mortgage... 1) what's your house worth (a - lots) 2) how much have you got borrowed on it? (a - very little) 3) you can have any amount - how much do you want??

I lived in a South East commuter town, try owning a decent house on an Engineer's wage in that area. Was one of the main reasons we came to NZ - and now live in Akl!

[richard 384]

Not my words,full version here

http://www.westpac.co.nz/rednews/property/hotspots-pinpointing-up-and-coming-suburbs/?utm_source=outbrain&utm_medium=cpc&utm_campaign=rednews&utm_content=Real_estate_tips_how_to_pinpoint_up_and_coming_suburbs

The trendsetters are moving there

Artists and musicians are often cash-strapped but influential, and the places they choose to live can set the trend for other buyers. It may seem like an inexact way to identify such a big investment, but all over the world the same pattern emerges, says Hart. From Londons Chelsea to New Yorks Soho, artists are the first to find the hot new suburbs.

"Artists look for somewhere that is accessible for clients, but cheap, says Hart. "The next people to follow are creative types like art directors and photographers, who benefit by associating with genuinely artistic people. Then come the next-level television professionals, then the cafes go in, then the boutique fashion and organic food stores."

Here's some tips for you Graham, look for the OMC's

Otahuhu

Onehunga

Oranga

One tree hill (you might be to late for this one)

Owairaka

Most of these areas have big sections that can be x-leased, have old style houses that need rejuvenation.

[gjm 3193]

Anywhere that begins with 'O'...?
I quite like Onehunga, actuially.

We're scratching our heads a little because while we'd like to be able to walk to the shops, cafes, etc, we also want the quiet and tranquility that comes from living somewhere significantly more rural. Mutually exclusive requirements, really.

Right now we're digging in, sucking up the commute, and trying to get a viable plan together. We've been through some tough times - less than 18 months ago we were literally penniless - and there's no sense in making life any more difficult for ourselves than is really necessary. I've a new job, Carol's looking for work, Bex is doing well at school... It's coming together.

[MLM 57]

I bought in one of the "O" towns. Two years on I'm amazed at the rate the area is changing. For sub 500k our first home is on a full section 3bdrm with a 6x9 garage. The house needed some work but not beyond diy capability.

Now with the area changing. Multi swimming pool complex and new train interchange due next year. Even the worst houses are demanding dollars beyond the reach of mere mortals. But there are still buys to be had depending if you don't mind a unfashion able suburb and a house with some work required.

[MattA 162]

Its all simple supply and demand, generally home ownership in NZ is relatively affordable, just not in Auckland.

Adding to what Nick said, NZer's have expectations beyond our means, we've had it very easy for a long time (when compared globally). We do live in one of the best countries in the world, something that is all too easy to take for granted.

We've recently got back on the property ladder with a 3 bed, 1/4 acre (1180m²) section, recently renovated, heat pump, log burner, heat transfer thingy and 2x three bay garages. $350k.

We're an average 75min drive to AKL CBD (best was 44 min worst 2:20).

Most of my work is in Auckland and the travel is a negative but we would't get anything comparable (in a decent school zone) for what we paid.

Have a rural outlook, even have dairy cows dropping calves in the paddock next door.

We probably won't see any significant gains in value but didn't purchase for that. It a home and by my standards fairly nice at that.

Just need time to fill the sheds with toys......

[_ethrty-Andy_ 2122]

There are about 1500 propertys on TM between 300-400k all over the auckland area,

your first home is just that, a first home. Its a step on the ladder, it might not be where you want to live for the rest of your life but better than renting and complaining that you can't afford that 900k house.

When i brought my first house i sold all my toys, didn't go out parting like my mates, had flatmates (lots), worked around the house building and adding on improvements.

I don't think the LVR have helped ether, and i hear through the grape vine that when they are removed all the new/first home buys will rush in and push the cost up even more.

And my new CV has just arrived.

You got it spot on. I will leave my opinions on the Auckland ratrace at the door and jump straight to the point.

You cant jump right into what you want. You dont get a university degree today and then walk into Rod Drury's or any other CEO of your picking's office tomorrow. You need to work towards your goal.

My first house i brought at 18.5 years old off a part time and eventual full time job. ticked none of my boxes for lifestyle choice. Apartment, no garage, but chose the right suburb. Did it up, sold it 2 years later and made a very good profit, a 25% return, or 12.5% ish pa (too late to work out accurate percentage in my head, you get the idea). not a bad return, not to mention i didnt pay a cent towards someone elses mortgauge, my only real expence is the interest cost, the rest of the mortgauge is just paying off an asset i already own.

Yes, you can give up some things for a couple of years, its not hard unless you have kids. Reminder, this is outside Auckland, you Aucklanders have it easier if you know what you are doing, much much harder if you dont.

Now have a 3 bedroom place, massive section, double garage, 15 mins from town, and got it when i was 21, now i am nearly 23.

I do not intend to skite or boast, but just giving some fact. between the ages of 20 and 25 are the perfect time to put in the work and get a solid foundation to build on by the time you have a family, when everything becomes a lot harder. between these ages, and even before that, you are living with family or friends, your single, or at least only dating, your expences are nice and low, prime time to get that deposit together. Unfortunately most at this time enjoy the taste of money too much and drink it away, and finance a vehicle worth more than they earn in a year, because they "can"

I am not saying I did it right, or the best way, i never did the OE thing, or went to university, both things that may impact choices later on in life, however i have never intended to work for someone elses bottom line anyways, its a reality for now, but not much longer. Just a different way to achieve my goals. but when i look around and see those that did the OE thing and uni thing under 40-100k of debt they wont pay off till they are 30, never mind if any kids come along, its really no wonder people cant buy into thier 40s, and at that point they realise they want it all now, thier life is half over and nothing to show for it but a desk job liability.

Just another side to the coin i guess

[E30 325i Rag-Top 2914]

It's the Gen-Y problem, can't wait for anything, want it all straight away, not going to work their way up the property ladder, want to go straight to the 4 bed villa in Ponsonby.

When the bank manager says they can't have the money they cry any wail because no one has ever said no to them before. And it's not their fault (it never is) so it must be the big bad Property Market to blame.

[richard 384]

This is also another reason why house prices keep rising, far easier to buy a house than build. http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=11387725

I bet theres a lot more to the story than is being told.

[richard 384]

even the banks are saying AK's house prices are unstopable.

http://www.nzherald.co.nz/property/news/article.cfm?c_id=8&objectid=11441598

[Michael. 2312]

Guess that means I'll be living in a shed with my cars in the middle of nowhere in years to come

[richard 384]

This beauty is only about 5 doors down from our place... You too could have commuters using your place as a park and ride, p*ssd @ssholes stumbling home from Ponsonby Road most nights, blow off valves from all the tw@ts that race down Richmond Road after midnight every night and sh*te music from Golden Dawn until 3am most weekends for a mere $1.075M plus the other million you'd need to make it habitable. A sensible investment in a growth area.

At least we know we've got a bit of equity.

EDIT: I am aware that this is a first world problem.

Full circle

http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=11449931

[jeffbebe 1559]

Yeah, I've been watching their progress.

[hybrid 1039]

I'm sorry but anything a bank + nz herald + stuff + says weather want you to believe it or not are creating hype to create business. Yes its driven by by demand, but that hysteria is being driven by media ad placements.
On top of all this the numbers of average prices are being slanted by the fact there is just mostly no first home buyers are keeping the average sale price down. Anyone trying to sell a house at the moment in the first home buyer price bracket is wanting more than top dollar for theirs driven by the Auckland city council and its agenda. The high percentage of first home buyers aren't stupid. They're not going to pay on the whole for more than somethings worth as there is no value that they can add for more than 10 years.
This leaves 2nd home buyers who are cashing in and trying to step up and reset their mortgages back to 20% equity (or more). The second or third home buyers market is enjoying a buoyant time at the moment. Although the middle investment mums and dads have just hit the skids with the 30% equity thing

[_ethrty-Andy_ 2122]

its about time to cash in on your house now if you do live in auckland.

the government wont be able to do anything to prevent the bubble bursting unless they do some radical policies, which themseleves will be risky.

delaying the inevitable is the only solution they are putting forward at the moment

[hybrid 1039]

Hmmm I dont really see a bubble personally. There really isnt enough housing to go around, including the rental market. Its going to be 5-10years before the new sub-divisions are all up and running. People still want to own a house close to Auckland CBD.

Unfortunately Auckland is now Sydney.

[Breaker 980]

Sell up, move to the Waikato, buy v8s with the change.

Worked for me

[coop 261]

+ 1. I bought 1 acre of flat land just outside of Cambridge with 150m2 shed. After building a 300m2 house w/4 car garage it will be cheaper than the average 3-4bd North Shore home on a 300m2 section... and quicker to commute to my old job in Manukau now the Waikato expressway is well under way.

[_ethrty-Andy_ 2122]

Sell up, move to the Waikato, buy v8s with the change.

Worked for me

+ 1. I bought 1 acre of flat land just outside of Cambridge with 150m2 shed. After building a 300m2 house w/4 car garage it will be cheaper than the average 3-4bd North Shore home on a 300m2 section... and quicker to commute to my old job in Manukau now the Waikato expressway is well under way.

I am just one guy with an opinion, but if you are in it for the medium to long term, i think you couldn't really go too far wrong in Hamilton as long as its something reasonably tidy.

[richard 384]

For me living in auckland is not just about work, theres the after work things like,

fishing in 30mins both harbours

beaches west coast and east coast

2 race tracks within 40 mins

bike track around the harbours

lots of parks

etc.

for the kids

islands to explore

zoo

motat

a large selection of private schools

and yfy

more shopping centers than she can get around.

I'm not dissing the rest of NZ I have lived in other parts.

Oh nearly forgot

the blues

the warriors

[hybrid 1039]

I agree, there is just too much in Auckland for me to move anywhere else. I was raised in Christchurch and it is still home but AKL really does have it s**t together now. Especially if you are clever and worked your way around the peak hour traffic issues.

[Apex 693]

Guess that means I'll be living in a shed with my cars in the middle of nowhere in years to come

Thats my plan... had brought the land already, but sold it late last year.

About to put my other property on the market, has increased 60k in 6 months.

I can buy a nice house in Taupo or surrounding area's freehold, maybe rent it out as an investment and travel for a bit.

Exciting times, kind of glad I spent my 20's working hard.. time to be a 33 year old 23 year old.

[m325i 705]

If you haters had bought in AK at the start of this thread, you could have sold now and paid cash for your rural shed.

[westy 614]

+ 1. I bought 1 acre of flat land just outside of Cambridge with 150m2 shed. After building a 300m2 house w/4 car garage it will be cheaper than the average 3-4bd North Shore home on a 300m2 section... and quicker to commute to my old job in Manukau now the Waikato expressway is well under way.

This 1/2hectare 50kms north west of Auckland with 260m2 house is also cheaper than a 4 bed on the Shore.

Just needs a shed....

[westy 614]

Actually, that may not be true anymore, hmmm.