Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Buyers and investors leave market

Buyers and investors leave market

REINZ's latest housing statistics for February showed that sales for properties under $400,000 fell 17.7% compared with February 2013. Some commentators believed that LVR restrictions would force out first home buyers and allow investors to swoop in and buy up bargains. However the REINZ information shows that property investors as well as first home buyers have left the market.

This evidence is supported by data from a recent NZ Property Investors’ Federation (NZPIF) survey of members of the 20 Associations affiliated to the Federation. The NZPIF survey asked these members “has the introduction of LVR restrictions changed your thoughts on buying rental property?” 71% said these restrictions had not had any effect. Only 7.87% said they would probably buy more property because of the LVR restrictions, but 13.48% said that these restrictions would cause them to buy fewer rental properties.

Executive Officer of the NZPIF, Andrew King, said “This contradicts the perception that property investors are benefiting from the effects on the market of the Reserve Bank’s LVR policy. The number of Association members have been restricted in making property purchases by the LVR restrictions is higher than the number who stand to benefit from them. ”

An additional factor influencing first home buyers is the cost of renting.

Results of a NZPIF study in December 2013 comparing the cost of buying or renting a home found that it was $138pw cheaper to rent than to own the average New Zealand home.

"Many potential first home buyers will look at the numbers and make the decision to continue renting" says King. "The expected rise in mortgage interest rates will make renting even more advantageous. “

From 1 September 2013 to 28 February the medium rental for a three bedroom house throughout the country was $350 a week. Principal economist of the NZIER, Shamubeel Eaqub, confirmed in November that although there had been strong growth in house prices, not much growth had occurred in the level of rents. This means that, in general, landlords are not taking advantage of the current pressure on rental property.

ENDS

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Company Results: Air NZ Rides The Tourism Boom With Record Full-Year Earnings

Air New Zealand has ridden the tourism boom and staved off increased competition to deliver the best full-year earnings in its 76-year history. More>>

ALSO:

New PGP: Sheep Milk Industry Gets $12.6M Crown Funding

The Sheep - Horizon Three programme aims to develop "a market driven, end-to-end value chain generating annual revenues of between $200 million and $700 million by 2030," according to a joint statement. More>>

ALSO:

Half Full: Fonterra Raises Forecast Milk Price

Fonterra Co-operative Group Limited today increased its 2016/17 forecast Farmgate Milk Price by 50 cents to $4.75 per kgMS. When combined with the forecast earnings per share range for the 2017 financial year of 50 to 60 cents, the total payout available to farmers in the current season is forecast to be $5.25 to $5.35 before retentions. More>>

ALSO:

Keep Digging: Seabed Ironsands Miner TransTasman Tries Again

The first company to attempt to gain a resource consent to mine ironsands from the ocean floor in New Zealand's Exclusive Economic Zone has lodged a new application containing fresh scientific and other evidence it hopes will persuade regulators after their initial application was turned down in 2014. More>>

Wool Pulled: Duvets Sold As ‘Premium Alpaca’ Mostly Sheep’s Wool

Rotorua business Budge Collection Limited (Budge) and sole director, Sun Dong Kim, were convicted and fined a total of $71,250 in Auckland District Court after each pleading guilty to four charges of misrepresenting how much alpaca fibre was in their duvets. More>>

Reserve Bank: Labour Calls For Monetary Policy To Expand Goals

Labour's comments follow a speech today by RBNZ governor Graeme Wheeler in which Wheeler sought to answer critics who variously say he should stop lowering interest rates, lower them faster, or that inflation-targeting should no longer be the primary goal of the central bank's activities. More>>

ALSO:

BSA Extension And Sunday Morning Ads: Digital Convergence Bill Captures Online Content

Broadcasting Minister Amy Adams has today announced the Government’s plans to update the Broadcasting Act to better reflect today’s converged market... The Government considered four areas as part of its review into content regulation: classification requirements, advertising restrictions, election programming and contestable funding. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news