Property costs in NZ - the heart of evil

[Indiana_Jones]

Ha well a price plummet isn't good for anyone - including people who are looking to buy a first home. It comes with all sorts of other economic baggage....

I don't want a plummet, but rather a correction. Say 30%-40% off the current prices would be ideal.

-Indy

[Flip]

Don't hold your breath.

House prices are on the way up now.

[jasonu]

We need to start shooting people who promote political correctness. It just ain't right.

Quote of the year (so far) right there!
Note I know it was posted last year but I just read it...

[Jantar]

I don't want a plummet, but rather a correction. Say 30%-40% off the current prices would be ideal.

-Indy

No it wouldn't. All thos people who have bought houses at less than 40% deposit (most I'd say) will find the bank's foreclosing on the mortgages as the equity left in the house is less than owed to the bank. This is what partly caused the economic collapse in USA a couple of years ago.

[Brian d marge]

No it wouldn't. All thos people who have bought houses at less than 40% deposit (most I'd say) will find the bank's foreclosing on the mortgages as the equity left in the house is less than owed to the bank. This is what partly caused the economic collapse in USA a couple of years ago.

thats right , but then the banks would want their money ......so we have a lot of cheap houses on the market

boo hoo cry me a river if you bought , a shoebox in Auckland for 1/2 a mil on 5% deposit . ....

The oldies wont like that you know , just not cricket, that aint

Stephen

[Flip]

No it wouldn't. All thos people who have bought houses at less than 40% deposit (most I'd say) will find the bank's foreclosing on the mortgages as the equity left in the house is less than owed to the bank. This is what partly caused the economic collapse in USA a couple of years ago.

It was the banks fault lending to people who they knew could not meet the repayments (sub prime) and the insurance industry fault for taking out insurance against the banks loss (deritives insurance).

It wasn't at all that difficult to understand, was driven by corporate greed and all it resulted in was the whole pile of cards falling in.

[scumdog]

It wasn't at all that difficult to understand, was driven by corporate greed and all it resulted in was the whole pile of cards falling in.

I've no problem with banks going bung - as long as it doesn't cost ME more.

The people behind the counter tend to be OK - it's their banks blood-sucking policies that burns my arse, greedy muthafuckas all of 'em.

[Flip]

They honestly thought they could mitigate the risks of lending money to folk who could not pay it back.

Morons is the term that comes to mind. They fucked up a lot of people.

[unstuck]

Bankers...rhymes with Wankers.

[scumdog]

Bankers...rhymes with Wankers.

Yup, WE screw-up. YOU pay.

Seems to be their credo....

[Indiana_Jones]

No it wouldn't. All thos people who have bought houses at less than 40% deposit (most I'd say) will find the bank's foreclosing on the mortgages as the equity left in the house is less than owed to the bank. This is what partly caused the economic collapse in USA a couple of years ago.

Ah well, we'll keep with the status quo and make sure those young people are squeezed out of the market a bit more

-Indy

[jonbuoy]

It was the banks fault lending to people who they knew could not meet the repayments (sub prime) and the insurance industry fault for taking out insurance against the banks loss (deritives insurance).

It wasn't at all that difficult to understand, was driven by corporate greed and all it resulted in was the whole pile of cards falling in.

Nobody forced anyone to take out mortgages, public stupidity played a part. Even if you put up a 20% deposit on a property you buy for 500k, if house prices drop by 50% and you loose your job both you and the bank are screwed. But yeah writing has been on the wall for a long time...

[Brian d marge]

Banks do what banks do , make money
And people do what people do ,
That's a recipe made in heaven ..:-)

So let me get this straight , the banks , get a dollar , then lend that same dollar out up to 9 times , amend charge a fee for taking the risk (fair enough) , so you now have 9 times more money in the economy than you did before ,,and if the supply of houses is finite or growing less than 9 times , then the price of the house will go up, until it becomes unsustainable at which point something has to happen

Something ain't right :-)
Stephen

[mashman]

Nobody forced anyone to take out mortgages, public stupidity played a part. Even if you put up a 20% deposit on a property you buy for 500k, if house prices drop by 50% and you loose your job both you and the bank are screwed. But yeah writing has been on the wall for a long time...

I reckon that many Republicans would disagree with you. They blame Bill Clinton and his mortgage de/regulation bill of 1995 that "forced" banks to make mortgage loans to whomever asked. Obviously not as simple as that, but just shows that they'll blame anyone and anything instead of laying the "blame" at the doorstep of where it should. Didn't the US bail out some of the homeowners who were "swindled"?

The bank are never screwed as they have to play pin the tail on the underwriter first.

[Brian d marge]

I reckon that many Republicans would disagree with you. They blame Bill Clinton and his mortgage de/regulation bill of 1995 that "forced" banks to make mortgage loans to whomever asked. Obviously not as simple as that, but just shows that they'll blame anyone and anything instead of laying the "blame" at the doorstep of where it should. Didn't the US bail out some of the homeowners who were "swindled"?

The bank are never screwed as they have to play pin the tail on the underwriter first.

Would that be the " glass steagal bill " 1933? which limited the banks from speculative dealing, and slowly eroded until clinton kicked ashes over the coals in 1999, 2000 and by doing so helped the speculative bubble
Still even without that , as soon as you start using fiat money at a rate greater than growth ( working age population) you are going to get price increases ,
while this isnt a "bad thing " when you start getting excesses and or laws that promote such excess ( thank you IMF , aka merica) , then all we are looking at now is the "speed and/or the regularity of these corrections .
Iceland had a good idea , Money ( as we have decided to use it ) brings with it responsibility , and as we all use it and it has potential to cause great hardship. The punishment for failing should be hard , (harsh)
Trouble is money can buy a lot of get out of jail cards especially in merica .

A good start is a capital gains tax on residential properties

all in my Humble opinion


Stephen