[jess]

NZ Herald Dec. 16:

House prices up by $6000 (http://www.nzherald.co.nz/section/1/story.cfm?c_id=1&objectid=10415651)

House prices have surged ahead again with the national median rising to a record $330,000, up $6000 in a month.

Prices in Auckland and Wellington were particularly strong, according to the Real Estate Institute's data released yesterday. It said the two cities were barometers for the rest of the country.

Auckland prices were up $10,000, from $415,000 in October to $425,000.

Wellington's rise was an even more spectacular $15,000, from $355,000 to $370,000.

The national median price in October was $324,000. Sales volumes were strong, rising from 8857 in October to 9990 last month.

Institute president Murray Cleland said winter was slow and prices subdued but the past two months demonstrated buyers' confidence had returned.

Shamubeel Eaqub, economist at Goldman Sachs JBWere, said the buoyant housing market would add to the Reserve Bank's discomfort.

"The bank has been voluble in arguing the need for house prices to rebalance closer to historical norms," he said.

"The bank will be increasingly cautious of the rebound in the property market. "

The institute said on average it takes 29 days to sell a house, unchanged from October. The national median price had risen faster than interest rates in the past year, averaging 10 per cent.

Prices rose fastest in Taranaki, up 29 per cent, followed by Nelson/Marlborough and Southland up 20 per cent, Wellington up 17 per cent and Northland up 12 per cent.

[Ana&Steve]

:wah I hate that! I feel like it's going to be the same struggle we had buying our first house (in California). :( I had heard the government in NZ was going to try to regulate housing prices in order to get back to 70% home ownership again; anyone else heard that?
Ana

[Trigirl]

i'd not heard anything like that - i'm not sure how you would regulate house prices anyway? but i think there is some provision in kiwisaver that allows people to access their savings to pay for their first home.

[jess]

I had heard the government in NZ was going to try to regulate housing prices in order to get back to 70% home ownership again; anyone else heard that?
Ana

I haven't heard of anything like that either. The Reserve Bank keeps saying housing prices are increasing at an unsustainably high rate and will stall. They've been saying it for I guess about a year now (since we started looking at houses online before the move at least) but the prices keep going up instead.

[pieeater]

Not heard anything about government intervention either.Bollard is trying his best to slow it all down but when he raises interest rates the dollar strengthens and exports suffer it's all on a knife edge at the minute.Sad thing is that buying a home is getting harder and harder to do for the average kiwi.So much so that the banks have increased the amounts they are willing to lend.Scary stuff.

[stu70]

The best force to regulate house prices is "market". The key is to have loads of patience. The realestate frenzy is all about psychology of investors(greed). If the economy does not have fundamentals to support this madness, then market forces will violently correct the situation. Many investors will see their fortunes disappear. If reserve bank's top banana is recommending caution, what more do people in NZ want in terms of signal to become more cautious? This "boom" has been primarily happening due to immigrant influx and not because of a growing and improving economy. As such it is just a matter of time before you see the bust.

[Sam'n'Kelv]

This "boom" has been primarily happening due to immigrant influx and not because of a growing and improving economy. As such it is just a matter of time before you see the bust.

I would imagine that there is some significant resentment by kiwis against immigrants who are pushing house prices beyond many people's reach. Have people encountered this?

[veronica]

the govt thing could be some sort of mortgage help that was being proposed for first time buyers, and its a real shame that wages aren't going up at the same rate. the latter has got to happen soon as the differential is too big.

[Marco]

I would imagine that there is some significant resentment by kiwis against immigrants who are pushing house prices beyond many people's reach. Have people encountered this?

This is already the case since 10 years when the influx of larger amounts of people from Asia came into NZ. On the other hand, when there were no 50,000 immigrants per year entering the country then the economy would come to a stand-still, I guess.

The way the government tries to 'regulate' is via the interest rate. At this moment the idea is that it will be increased. The general view for the future is that the rise in house prices might slow down a bit, but that it will not really collapse.

Cheers,
Anita

[jess]

On a brighter note for renters - a Dec. 7 NZ Herald story (http://www.nzherald.co.nz/section/8/story.cfm?c_id=8&objectid=10414159) did say that Auckland rent wasn't going up as fast.Although house sale prices are up, rents have remained almost static, the Barfoot figures show.

Among the properties the agency manages, the average weekly rent last month was $359, against October's $356, September's $343 and August's $340.

The agency let 633 houses or units last month, up on 620 in October and 651 in September.

I wouldn't call a $76/mo. increase in the avg. rent from Aug. to Nov. 'almost static', but it's certainly not the percent of increase that homes for sale are seeing.

[Ana&Steve]

I found one of the stories that prompted my above question...it wasn't as informative as I'd thought. :(
Home Link (http://www.nzherald.co.nz/search/story.cfm?storyid=00060942-80C1-1544-82F483027AF1010F)
Ana