Property costs in NZ - the heart of evil

[mashman]

You're obviously upset about Basel III, but as usual you don't quite know why.

It's easy, the GFC was caused by banks lending money to dodgy bastards that, unsurprisingly failed to pay it back.

In steps govt and says: Thou shalt not lend money to dodgy bastards, and thou shalt not wrap the dodgy loans in bright colours and flog them to even dodgier bastards in order to avoid the fallout. And to make sure you don't here's a few new rules for you.

It's essentially the opposite to what the US did to cause their share of the GDC, and that alone makes it a good idea.

Now fuck off and do some work you lazy dodgy bastard.

Yeah yeah... it was my period.

[avgas]

You'll get something decent for yer cash in the US by the looks of things . A nice white picket fence in the burbs.

There's that problem still lingering though. By the time you've saved 200k, you end up needing 300k for the deposit. One thing I do wonder, is that 20% based on the principle or the amount that will have been paid over those 30 years? I ask as once they have my 200k, don't they have a debt for approx 700k? After all they expect me to pay off the interest before I pay off the principle, on some form of sliding scale. I believe I start paying 50% principle and 50% interest at about the half way point of the mortgage.

Wife quite liked this http://www.zillow.com/homedetails/9-...32979045_zpid/ its in a good neighbourhood, fucking huge......thank god power is cheap there. Our crapbox in Auckland sold for $641.......and was about 1/3rd size of this. So yeah bit disproportionate.

Good on you but this illustrates the complete disconnect between Auckland and the rest of NZ, (although Christchurch is an anomaly).
The average time to sell across the whole country is 35 days. Manawatu 55 days, Southland 60 days, and Taranaki 50 days. In reality houses sit unsold in many places for months.

I don't know how we change but it seems incredibly inefficient to have houses going begging in some places while people take on telephone number mortgages to buy an old or very basic house in one area.

True but oddly nobody ever seems to point out this basic fact.
One thing: everyone needs to live somewhere so inevitably they pay rent. Once you are settled might as well pay a mortgage.

Unfortunately that is life. People seem to think because my love shack in Auckland sold in 6 days for a gazillion dollars that a similar property will sell in Greymouth for proportionate price.
Failing to account for the one thing every market needs. Buyers. If you can't sell a house for $120,000 (marked down $50K) in Chicago......how can you justify a mark-up of $50K for a house in Gore?

10 years ago I just about bought a place in Putaruru (investment only). Back then you could buy it for $60K. Same place now would be $300K+. In comparison I looked at Sandringham in Auckland - $250K. Same place is now $1M. So Auckland up by 4 and selling straight away.......Putaruru up by 6 - and taking longer to sell.
Its not rocket science. Drop the putaruru house price down, to the price the PEOPLE will pay and it will sell. People think Auckland is crazy - nah its just a saturated market. If you market isn't saturated how can you expect a big price?

I'm confusing myself enough at the moment. Was just wondering how much the bank would need to hold, but I'm off in captain tangent land in regards to Basel III and can't even blame beer... a loss of an hours sleep perhaps . I must be having my period, yeah, that's it.

No you haven't missed my point. I have

Basel basically meant that if banks had loans for assets - and the asset was not liquid, they had to put liquidity aside to cover some of the debt.

So if you have a house in Gore, worth $100K, mortgaged for $80, and they can't sell it tomorrow for $80......they had to have an additional $20K (not your deposit) to cover their ass if their debt collectors came calling.

i.e. bank chases you and gets house, lenders chase bank and get house + $20K.
Rather than what happened with U.S. sub-prime which was....
bank chase you, and gets house valued at 1/10 of the debt (you still owe 9/10s of debt), lenders chase bank gets house and bank still owes 9/10ths of debt - which you can't pay. Whole market turns into chain-gang owing the guy in front. With no assets left to sell.

[Morcs]

It seems in times like this, anyone selling or buying in this climate is only thinking of capital gains - so anyone interested in simply buying a house as a place to live gets shafted. People need to focus more on building equity - starting with a deposit.

[mashman]

Awwwww that's nice. Free money from your caring sharing govt if you meet the criteria and buy a former state house.... and who says you get nothin for free.

[Ocean1]

Awwwww that's nice. Free money from your caring sharing govt if you meet the criteria and buy a former state house.... and who says you get nothin for free.

I see that. Not a bad idea, especially as most of them will be in the smaller centres.

Think of it as a "Get out of Town" bonus.

[blue rider]

I see that. Not a bad idea, especially as most of them will be in the smaller centres.

Think of it as a "Get out of Town" bonus.

any jobs coming with that "get out of town" bonus?

[avgas]

any jobs coming with that "get out of town" bonus?

Fixing up other peoples state houses

[mashman]

Fixing up other peoples state houses

heh, all 500 over the next 4 years. That should keep 10's of thousands of people in a job across the country for like a billion years.

[Ocean1]

any jobs coming with that "get out of town" bonus?

There's always jobs for those that want them.

Fixing up other peoples state houses

heh, all 500 over the next 4 years. That should keep 10's of thousands of people in a job across the country for like a billion years.

Certainly keeps my boy busy. Very busy in fact, you've got no idea how delicate and fragile those bloody state houses are, you can kick holes in the walls! And the windows break at the slightest stone!

[mashman]

Certainly keeps my boy busy. Very busy in fact, you've got no idea how delicate and fragile those bloody state houses are, you can kick holes in the walls! And the windows break at the slightest stone!

You seem to be assuming that I don't know what a state house looks like from the inside, let alone whether I have lived in one or not. Wrong on both counts.

[Ocean1]

You seem to be assuming that I don't know what a state house looks like from the inside, let alone whether I have lived in one or not. Wrong on both counts.

You're reading shit that's not there again, what on earth makes you think I give a fuck?

[mashman]

You're reading shit that's not there again, what on earth makes you think I give a fuck?

you've got no idea how delicate and fragile those bloody state houses are

Take your pills son.

[avgas]

heh, all 500 over the next 4 years. That should keep 10's of thousands of people in a job across the country for like a billion years.

Don't see why not - I have seen the same piece of road repaired in Northland every 2 months..........the roading vehicles double the number of cars on it in that period.
(It's 100m from boys homes.....and they don't like to travel to where the road is actually damaged because then they won't be home by 5........and govt pays regardless)

[avgas]

Certainly keeps my boy busy. Very busy in fact, you've got no idea how delicate and fragile those bloody state houses are, you can kick holes in the walls! And the windows break at the slightest stone!

When raising pigs. It's best to leave them in their mess so they no not to mess it up in future. True story. My Kunekunes were some of the tidiest animals I had.

[Ocean1]

When raising pigs. It's best to leave them in their mess so they no not to mess it up in future. True story. My Kunekunes were some of the tidiest animals I had.

My daughter owns her home for the first time a while ago, it'd been a rental and the tennants had left it a bit untidy. So the boy gave her a hand to redo the bathroom, and she's painted doors and wallpapered a few rooms.

And NOW she understands. I turned up the other day with crayons for the resident rugrat, and you could see the anxiety immediately She couldn't say a word, at not much older she'd painted her own bedroom walls with some enamel she found in the garage. She's actually careful not to drag the vacuum cleaner hose around the doorframes, and she gets upset when I laugh at her.