# Housing: market news and updates



## adinanz

Hi,

Can anyone tell me what would be the average price for a 3-4 bedroom house in a good school zone, good neighbourhood ( and which are these?)
I would like to know how much would be to buy a house and also the rent a 3-4 bed .

thanks


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## jenswaters

adinanz said:


> Hi,
> 
> Can anyone tell me what would be the average price for a 3-4 bedroom house in a good school zone, good neighbourhood ( and which are these?)
> I would like to know how much would be to buy a house and also the rent a 3-4 bed .
> 
> thanks


It's quite a big question to answer to be honest, as it depends on what you are wanting from a school! It is best to look through Buy online and sell with NZ's #1 auction & classifieds site | Trade Me to check house prices and value for money.

Papamoa - your money tends to go further in terms of what you get. It is also right along the beach. It is a heavily expat-populated area, so is cheekily known as "Pommie-moa"!!

Areas around Otumoetai College are Matua, Bureta, Belle Vue and Brookfield. Again, rental prices vary according to what you want. 

It is hard to do, but it really is best to wait until you get out here. You don't get the feel for an area until you are here, and you certainly can't choose a school over the internet.


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## adinanz

Thank you,

I know what you mean, I would like to know just the average price for a house in a good location.

Thanks


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## Darla.R

Also take a look at realestate.co.nz. and this may be of some help too

Most expensive and cheapest Bay homes - Local News - Bay of Plenty Times

Word of advice - Tauranga has a reputation for being the most expensive place in NZ to buy a house, not sure what the rents are like.


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## jenswaters

adinanz said:


> Thank you,
> 
> I know what you mean, I would like to know just the average price for a house in a good location.
> 
> Thanks


Again, depends on how it is advertised, where it is etc. I recommend that you average about $350 a week for a 3-bedroom house. 4 bedrooms can go anywhere between $380 to $500 depending on where you are! $400-$420 is about right for a nice 4-bed house in a good area.

Rental is cheaper here at the moment than Auckland, I believe, but it is true that buying can be more expensive.

Hope this helps.


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## kiwifruity

Tauranga is breathtaking, but yes, homes can be pricey. I agree, Trademe has the best show of homes, also Gumtree. Whoo, yes, Auckies is really steep, regarding rentals and house prices, but then again, more employment here.....a tough one this. Good luck with everything!


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## adinanz

Thank you,

How about this kind of house in Papamoa, is it a good price, a normal price or a leaky home? Good neighbourhood?
How about the rent for this kind of house, any ideas?

Real estate for sale - MODERN STYLE WITH PANACHE - Trade Me Property

many many thanks


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## jenswaters

adinanz said:


> Thank you,
> 
> How about this kind of house in Papamoa, is it a good price, a normal price or a leaky home? Good neighbourhood?
> How about the rent for this kind of house, any ideas?
> 
> Real estate for sale - MODERN STYLE WITH PANACHE - Trade Me Property
> 
> many many thanks


I wouldn't recommend rushing to buy a house until you are here and get a feel for the market. Yeah, maybe leaky home, but then again maybe not.

As a rental I would expect about $400-420 per week (it is a good location).


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## adinanz

Thanks again,

No, not looking to buy, just browsing...wanting to know the prices for houses like that in good locations.


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## Cobra

*Wellington House Prices*

:juggle:Would be interested if anyone had any idea if property prices in Wellington are going to crash in the next couple of years. I've seen it happen in UK in 1989 and in Ireland in the past couple of years. I have a gut feeling it might happen in NZ as well. Any comments:


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## topcat83

Cobra said:


> :juggle:Would be interested if anyone had any idea if property prices in Wellington are going to crash in the next couple of years. I've seen it happen in UK in 1989 and in Ireland in the past couple of years. I have a gut feeling it might happen in NZ as well. Any comments:


Oh to have a crystal ball... 

Property prices have stagnated to gone down slightly all over NZ in the last couple of years (in line with the UK and States) - but what makes you think they might crash? I could understand it in Christchurch with all their current problems, but Wellington is as it's always been...


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## Darla.R

Cobra said:


> :juggle:Would be interested if anyone had any idea if property prices in Wellington are going to crash in the next couple of years. I've seen it happen in UK in 1989 and in Ireland in the past couple of years. I have a gut feeling it might happen in NZ as well. Any comments:


If you want to know what's happening to the property market in New Zealand stay away from press releases and interviews from the real estate industry who will obviously talk-up the situation.

Quotable value is a impartial observer of property prices, according to them prices in Wellington region are down minus 3.6%

The QV residential property indices show that nationwide values have remained flat in May.

“Nationwide property values have now remained steady for the past six months, after having declined in the six months prior to that. Values are now 1.6 percent lower than the same time last year, and 5.7 percent below the market peak of late 2007” said Glenda Whitehead of QV Valuations."

More

Property prices in New Zealand are linked to immigration - the more net inward migration there is the more prices rise. Supply and demand and all that.

If you want to know where the property market is headed keep an eye on the immigration figures.


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## Song_Si

*Wellington house prices fall*
01/07/2011

*The average asking price of homes in the capital has fallen to $419,000.*

Around the country the number of new property listings continues to fall and shortages are beginning to show in some areas, a monthly property report out today said.

Realestate.co.nz, the real estate industry website, said listings in June slumped 8 per cent from the previous month and 18 per cent year on year.

Some areas, including Auckland, Queenstown, Tauranga and Waikato, had firmly become seller's markets after two and a half years of being buyer friendly.

The Wellington market remains quiet, with listings falling four percent on June last year. But Mr Helm said supply and demand was fairly balanced. The asking price was $419,427, down two percent on May.

full article here


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## Song_Si

*comaprisons 2008 and 2009*

this article from 2009, with previous post gives an indication of the price changes for Wellington

*Drop in the number of Wellington house sales*
*February 13, 2009*

The Real Estate Institute has announced that the number of house sales in Wellington in January dropped to 396, compared with 489 sales the previous month, and 594 sales in January a year ago. 

The median price for houses in Wellington fell to $362,500 in January from a level of $370,000 a month earlier. (January 2008: $366,750).


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## anski

*Property values up in June - Auckland leads the charge*

Nationwide property values increased in June, driven largely by the Auckland market - where property values in the city are now higher than the 2007 market peak.

Nationally property values are now just 0.9 per cent behind the same time last year, and up 1.4 per cent across the wider Auckland area, Quotable Value said.

"There is variability across the Supercity with the Manukau area being more or less stable over the past three months, while North Shore and Waitakere have increased modestly," QV's research director Jonno Ingerson said.

Values in the Auckland city area are at their highest-ever level (up 0.7 per cent on 2007 values), largely due to a lack of property listings, demand for established character locations, good school zones and the perception that purchasing in central Auckland is a safe investment.

Barfoot & Thompson said last week Auckland house listings were at a four-year low as winter gloom and a tepid economic recovery sapped home-buyers' appetite to commit to big-ticket purchases.


Wellington was the only main centre where values continued to decline - down more than a per cent since January and 3.3 per cent below the same time last year.

"Uncertainty around restructuring in the public sector may be causing some home owners to take a more conservative approach to the property market," he said.

Ingerson said Quotable Value would not be publishing an index for Christchurch until it had more certainty about the validity of the results there.

"The low sales volumes and patchy activity across large parts of Christchurch for several months now means that our standard index may not be comparable to the index pre earthquake."

Meanwhile the average New Zealand sale price in the last three months was $412,746 up from the $404,057 reported last month.

Values are still down across most regions when compared with last year, but the gap is closing: Whangarei (-4.1), Gisborne (-3.1), New Plymouth (-3.3), Wanganui (-4.0), Palmerston North (-2.8) and Invercargill remain the furthest below last year.

In Napier (-2.1) and Hastings (-1.4) values are still a little below last year, while in Rotorua (-0.2), Nelson (-0.2) and Queenstown Lakes (0.1) values remain similar.

- Susie Nordqvist

Property values up in June - Auckland leads the charge - Business - NZ Herald News


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## linbin

*benefits of New home package deals*

We are migrating to Orewa later this year and are interested in the land, house packages available in the region (Key2) seems prominent)Has anyone had experience of these good and bad, time from signing up to moving in,lane: quality, benefits, investment potential. Would be very interested in your thoughts & experience
Thanks


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## kiwigser

linbin said:


> We are migrating to Orewa later this year and are interested in the land, house packages available in the region (Key2) seems prominent)Has anyone had experience of these good and bad, time from signing up to moving in,lane: quality, benefits, investment potential. Would be very interested in your thoughts & experience
> Thanks


We came within a day of signing up with Platinum homes, but a house came on the market just down the road and we bought that. Just 3 years old. The main benefit of new homes is that they are well built and warm in winter cool in summer, i.e. very well insulated. You can buy an off the shelf package, or adapt a design or start from scratch. The builder will construct what you want. Single storey are cheaper and usually your land package will accommodate a largish house 200 to 300 metres squared including garage.
Investment potential is governed by how house prices rise.


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## Song_Si

Hi
Read this article, with a mention of Orewa - maybe of interest to you in terms of buying, and the long-term investment value


The ugly truth of clustered houses
Sunday Jul 17, 2011

*They're suburbs within suburbs and they're popping up all over Auckland.*

Building consents may be down overall, but large-scale residential developments are on the cards with thousands of homes planned for construction at Orewa, Long Bay, Mt Wellington, Karaka, Takanini and Hobsonville.

Experts are split over the merits of the developments, with up to 3000 new homes promised in some areas. They're either a solution to growing demand or a potential eyesore.

Work is at varying stages on plans at Auckland Council for major developments at Hobsonville Pt (3000 homes); Stonefields, Mt Wellington (2500 homes); Millwater, Orewa (3000 homes); Long Bay (2500 homes); Karaka Lakes (400 homes); Karaka Harbourside (442 homes); Addison, Takanini (1500 homes) and Kensington Park, Orewa (690 homes).

more


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## topcat83

Song_Si said:


> Hi
> Read this article, with a mention of Orewa - maybe of interest to you in terms of buying, and the long-term investment value
> 
> 
> The ugly truth of clustered houses
> Sunday Jul 17, 2011
> 
> *They're suburbs within suburbs and they're popping up all over Auckland.*
> 
> Building consents may be down overall, but large-scale residential developments are on the cards with thousands of homes planned for construction at Orewa, Long Bay, Mt Wellington, Karaka, Takanini and Hobsonville.
> 
> Experts are split over the merits of the developments, with up to 3000 new homes promised in some areas. They're either a solution to growing demand or a potential eyesore.
> 
> Work is at varying stages on plans at Auckland Council for major developments at Hobsonville Pt (3000 homes); Stonefields, Mt Wellington (2500 homes); Millwater, Orewa (3000 homes); Long Bay (2500 homes); Karaka Lakes (400 homes); Karaka Harbourside (442 homes); Addison, Takanini (1500 homes) and Kensington Park, Orewa (690 homes).
> 
> more


I must admit that these estates sound like my idea of hell. The whole point of coming to NZ to us was to get away from the rat-runs of the London suburbs. The difference here is that the houses are generally bigger, but have very little garden, and are slightly lower density than the average UK estate.


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## anski

Song_Si said:


> Hi
> Read this article, with a mention of Orewa - maybe of interest to you in terms of buying, and the long-term investment value
> 
> 
> The ugly truth of clustered houses
> Sunday Jul 17, 2011
> 
> *They're suburbs within suburbs and they're popping up all over Auckland.*
> 
> Building consents may be down overall, but large-scale residential developments are on the cards with thousands of homes planned for construction at Orewa, Long Bay, Mt Wellington, Karaka, Takanini and Hobsonville.
> 
> Experts are split over the merits of the developments, with up to 3000 new homes promised in some areas. They're either a solution to growing demand or a potential eyesore.
> 
> Work is at varying stages on plans at Auckland Council for major developments at Hobsonville Pt (3000 homes); Stonefields, Mt Wellington (2500 homes); Millwater, Orewa (3000 homes); Long Bay (2500 homes); Karaka Lakes (400 homes); Karaka Harbourside (442 homes); Addison, Takanini (1500 homes) and Kensington Park, Orewa (690 homes).
> 
> more



Stonefields Mt. Wellington was a firmer quarry & an eyesore at that. I was sceptical at first when I knew of the plan to build large scale housing of varied structured from apartments, town house to 4 bedroom detached homes. 

Some of the house are quite attractive & overlook a golf course. I was amazed at the speed the home owners established garden also, they took on an established look within months.

It has brought a whole range of commercial businesses, with a large Placemakers replacing the small one as well of all manner of kitchen, bathroom, carpet shops, etc, deli, & tavern. So it has injected life into the area & being 5 minutes drive from where I live I find shopping there convenient.

I think the housing development & the new established businesses are a big improvement to what before could only be described as ugly.


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## anski

*Sellers gain upper hand as housing stock halves*

Auckland's housing market is under intense pressure, the number of houses for sale almost halving since a peak and sellers gaining the upper hand because of a scarcity of stock.

Property sales business website realestate.co.nz yesterday issued figures showing how for-sale numbers had fallen since 2008.

The listings business's chief executive, Alistair Helm, said: "The most listings Auckland has had lately - that's houses, apartments and lifestyle blocks but not sections - was in April 2008, when there were 18,266 properties listed.

"That fell to 14,154 properties last November, and last month it was down to just 10,685 properties, so that's a significant drop.

"At this current rate of sale, it would only take only 24 weeks to clear all the available stock in Auckland," Mr Helm said.

An Epsom family, with $1 million in cash, searched for three years and found only a few possible buys.


One house, valued at $1 million, sold for $1.73 million leaving the couple surprised and annoyed.

Joss Goodall, a Barfoot & Thompson agent, said the sale illustrated what happened when a scarcity of houses on the market combined with low interest rates and rising economic confidence.

House sellers have the advantage over buyers in 16 out of 19 regions in New Zealand as listing numbers drop and the sector prepares for a spring rush.

"In the space of two months, the regional picture of New Zealand has moved from a buyer's to a seller's market," Mr Helm said.

In all but four of the 19 regions, sellers now hold the upper hand. Despite the emergence of this seller's market, the asking price expectation of vendors fell by 4 per cent," realestate.co.nz said.

However, both realestate.co.nz and Barfoot & Thompson say they are yet to see Auckland's listing shortage push up sale prices.

The listings business showed prices had fallen, and Barfoots said that in May, it sold 889 properties for an average $529,889 but in June it sold 1153 properties for an average $521,119.

Realestate.co.nz said the number of unsold houses fell everywhere except in Northland, Gisborne, Hawkes Bay and Wairarapa.

Pressure was most intense in Auckland, Otago, Nelson, the Otago Lakes area and Waikato, which have inventories well below the long-term average.

"Even in the context of the way the market has been moving, this is a dramatic drop in inventory. Winter is a slow time for new listings, but we're certainly seeing this more acutely than could have been predicted."

Levels may fall further in spring, when sales rise sharply as warmer weather brings out more buyers.

The rental market is also hot. Property managers Crockers said yesterday that two-bedroom places in the city were at an average of $365 a week - 20 per cent above the national average.

Rents for three-bedroom Auckland places jumped early this year and the June average was $486 a week - 30 per cent above the national average.


Sellers gain upper hand as housing stock halves - Residential Property - NZ Herald News


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## anski

*Auckland houses for sale lowest in a decade - Barfoot*

Auckland homeowners put just 1050 new properties up for sale last month, the lowest number in a decade, according to real estate agency Barfoot & Thompson.

The city's biggest real estate firm had just 4,830 properties on its books last month, the smallest number for four years, it said in a statement.

Still, Barfoot sold 778 homes in July, up almost 21 per cent from the same month though down 11 per cent from June.

The average sale price was $530,191, down 1 per cent from July 2010, and up by some $10,000 in June.

"Even though there are buyers out there, prices are increasing at only a nominal rate," managing director Peter Thompson said.

"Buyer are prepared to pay a fair market price, but not over the top."

Winter has bitten into people's enthusiasm for property, which was on the rebound after two years of tepid sales.

Record low interest rates have helped encourage people to return to the market, though the prospect of rising mortgage rates may sap that appetite.


ASB economist Chris Tennent-Brown said it was surprising, given the tightness in the market, that that average house prices from Barfoot and Thompson had been relatively steady over recent months.

"We expect ongoing tightness in the Auckland property market to be supportive of prices in the future, and price gains in Auckland are likely to be stronger than in most other regions over the year ahead."

Auckland houses for sale lowest in a decade - Barfoot - Residential Property - NZ Herald News


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## Song_Si

*House prices stable in July, says QV*
Monday Aug 8, 2011

*Government owned property valuation service Quotable Value (QV) has reported house values were stable nationwide in July.*

But QV said there were signs of strengthening values in central Auckland and Christchurch, while values were falling in Wellington and flat in Hamilton and Dunedin.

"Across the wider Auckland area values have increased 2.4 per cent since January, and as a result are now 1.9 per cent above last year and only 0.6 per cent below the previous market peak of late 2007. 

"Values in Hamilton, Tauranga and Dunedin have all been relatively stable for the past six months, although declines in the six months prior to that mean that all three areas remain below the same time last year" said Ingerson.

Wellington values have fallen 1.8 per cent since January and now sitting 2.7 per cent down from a year ago.

The average New Zealand sales price over the last three months was NZ$414,261, up slightly from the $412,746 reported last month. QV said this is a less reliable measure of value change than its index.

QV said values in most provincial towns remained below the same time last year.

Wanganui is the furthest below last year at 6.8 per cent down, with Gisborne down 4.6 per cent, Invercargill down 4 per cent, Whangarei down 2.7 per cent, Rotorua down 2.9 per cent, Hastings down 1.0 per cent, Napier down 1.5 per cent, New Plymouth down 2.6 per cent and Palmerston North down 1.0 per cent.

more


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## Song_Si

*House sales, prices decline*
Last updated 13:39 11/08/2011










*Strong regional differences have emerged in the latest Real Estate Institute of New Zealand housing market figures, although nationwide sales dropped by 2.5 per cent in July, compared to the previous month.*

The national median house price also fell, by $15,000 to $345,000.

REINZ national spokesman Philip Searle said the latest results continued the trend of the last few months and reflected a significant amount of uncertainty in the market due to the global financial markets. 

full article


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## Song_Si

*Real Estate Agent fined for 'disgraceful' behaviour*

many people list their houses for sale on Trade Me to avoid paying real estate agent fees - I'm old the NZ rates are high by international standards (?). Some such as this one are on a sliding scale, others a flat (eg) 4%.

*Agent fined for 'disgraceful' behaviour*
Saturday Aug 13, 2011

*A real estate agent who found a house for sale on Trade Me and helped the owner to sell it without explaining that she was an agent tried to sue the woman for commission.*

The commission rates were 4 per cent on the first $300,000 and 2 per cent thereafter.

But Rita Charles' case was thrown out of court and a Real Estate Agents Disciplinary Tribunal has found her actions "disgraceful

It called Ms Charles' behaviour disgraceful and fined her the maximum of $750.

full article


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## topcat83

Song_Si said:


> many people list their houses for sale on Trade Me to avoid paying real estate agent fees - I'm old the NZ rates are high by international standards (?). Some such as this one are on a sliding scale, others a flat (eg) 4%.
> 
> *Agent fined for 'disgraceful' behaviour*
> Saturday Aug 13, 2011
> 
> *A real estate agent who found a house for sale on Trade Me and helped the owner to sell it without explaining that she was an agent tried to sue the woman for commission.*
> 
> The commission rates were 4 per cent on the first $300,000 and 2 per cent thereafter.
> 
> But Rita Charles' case was thrown out of court and a Real Estate Agents Disciplinary Tribunal has found her actions "disgraceful
> 
> It called Ms Charles' behaviour disgraceful and fined her the maximum of $750.
> 
> full article


We've found NZ real estate agents commission rates scandalous - as your article says, Song Si, they can be up to 4%. Compare that to when we sold my Mums bungalow in the UK for a 1.25% commission (and we could have got 1% at another agent) and you can see just how much higher they are.

One reason for this is that there are so many real estate agents - you can see rows of them on the walls of any real estate office you go in to. So with so much competition they have to charge more as they don't sell so many each - and they have to make their salary reasonable. I say - that's not my fault.

They'll argue that they give a more personal service - but I'd dispute that. We had excellent service for our 1.25% in the UK, and much more professional leaflets were produced. In NZ, I continue to be amazed at the fact there are very few leaflets produced - unless you pay more - and the photos you get on the internet of the houses can be dire. When we rented out our sons house, we sent the agents our own photos as they were so much better than theirs!

There are a few options now apart from Trademe. Look at Homes For Sale New Zealand NZ, Private Sale Real Estate New Zealand NZ and http://www.greendoor.co.nz/ . Both are designed for people who want help with the marketing but are prepared to do most of the work themselves.


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## Song_Si

I have nil respect for any of the NZ real estate agents I've used over the years buying/selling.
Parasites and a lot worse words come to mind.
Regardless of their extortionate commissions, they provide a poor service - so it's not a case of 'value for money'.
On top of the commission fees will be all advertising fees, so the expenses of selling an average house are huge. 
One common complaint is that they take their commission from the buyer's initial deposit - and they're gone! Even if settlement is a month, or months in the future, they've got their $ and you are 'old news' and they're on to their next customer.


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## topcat83

Song_Si said:


> I have nil respect for any of the NZ real estate agents I've used over the years buying/selling.
> Parasites and a lot worse words come to mind.
> Regardless of their extortionate commissions, they provide a poor service - so it's not a case of 'value for money'.
> On top of the commission fees will be all advertising fees, so the expenses of selling an average house are huge.
> One common complaint is that they take their commission from the buyer's initial deposit - and they're gone! Even if settlement is a month, or months in the future, they've got their $ and you are 'old news' and they're on to their next customer.


A little tip based on purchasing 5 properties since we've been here - don't pay the deposit to the real estate agent. The real estate agent will tell you that you have to pay them - you don't have to. You can quite justifiably pay it into the trust account of your solicitor/lawyer instead. That's what we've done every time.


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## topcat83

topcat83 said:


> A little tip based on purchasing 5 properties since we've been here - don't pay the deposit to the real estate agent. The real estate agent will tell you that you have to pay them - you don't have to. You can quite justifiably pay it into the trust account of your solicitor/lawyer instead. That's what we've done every time.


Also make sure the offer you sign has the statement 'subject to due diligence', don't let them tell you that you must go unconditional in anything less than 10 working days (and if possible get this extended) and get your solicitor to check everything out ASAP. If there is anything wrong, the due diligence clause gives you a get-out. PS this doesn't work when you're dealing with an auction - you buy it as seen.


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## Song_Si

*another NZ real estate fraud*

*Vendors fooled by fake death*
Sunday Sep 4, 2011

*A couple knocked $5000 off the asking price for their house after a former real-estate agent claimed a potential buyer's relative had died and the family needed money to return to Samoa.
*
The only trouble was, nobody had died.

The agent, Rita Charles, was last month found guilty of disgraceful conduct by the Real Estate Agents Disciplinary Tribunal. But vendors Ronika Chand and husband Paul Martin's claim about the fake death was not covered by the tribunal case, which centred on Charles' attempt to act as an agent for them when they were trying to sell the house privately on auction website Trade Me.

Chand said they thought Charles was simply a friend of the purchasers, as she had brought them to view the home in Clover Park, Manukau.

"As far as I was concerned she was just a representative of the family."

Chand said Charles told her the purchasers couldn't afford to buy the house as the husband's mother had died and he was preparing to return to Samoa. "Ten minutes later she called me back and said she'd spoken to the purchaser again."

Charles had said the purchasers were still interested in the house but asked if she could drop the price by $10,000. The couple agreed to come down by $5000 "on compassionate grounds".

read more


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## Song_Si

*Prisoners in their own homes*
Sunday Sep 18, 2011

*Thousands of Kiwi homeowners are trapped in their houses because of negative equity created by the property bubble bursting - and they're being told they need to hold on for a while yet.*

In 2007, it was estimated about 40 per cent of first-home buyers were taking out 100 per cent loans.

Mortgage broker Kris Pedersen says they made up a large chunk of the lending he did between 2006 and 2008.

"If it was at the beginning of 2006, they probably would have gained equity but for borrowers in 2007, a large number would be in negative equity now. It would be thousands."

He says some borrowers were taking out loans of up to 110 per cent of their home's value and 100 per cent for investment properties.

Property prices in Auckland are still 5 per cent down on their peak. And BNZ chief economist Tony Alexander says it will be next year before there is a significant accelerated upturn in the market.

One expert says homeowners should stay in the property until the market bounces back as it is the only way to make sure they don't take a loss.

more


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## topcat83

Song_Si said:


> *Prisoners in their own homes*
> Sunday Sep 18, 2011
> 
> *Thousands of Kiwi homeowners are trapped in their houses because of negative equity created by the property bubble bursting - and they're being told they need to hold on for a while yet.*
> 
> In 2007, it was estimated about 40 per cent of first-home buyers were taking out 100 per cent loans.
> 
> Mortgage broker Kris Pedersen says they made up a large chunk of the lending he did between 2006 and 2008.
> 
> "If it was at the beginning of 2006, they probably would have gained equity but for borrowers in 2007, a large number would be in negative equity now. It would be thousands."
> 
> He says some borrowers were taking out loans of up to 110 per cent of their home's value and 100 per cent for investment properties.
> 
> Property prices in Auckland are still 5 per cent down on their peak. And BNZ chief economist Tony Alexander says it will be next year before there is a significant accelerated upturn in the market.
> 
> One expert says homeowners should stay in the property until the market bounces back as it is the only way to make sure they don't take a loss.
> 
> more


I guess there's a similar negative equity problem in the UK too - we certainly have a couple of apartments that we bought before we left, and if we sold them now we'd make a loss on the deal. There was a similar situation in the UK in the mid-90's too.


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## saltybroad

Great advice about deposits and clauses...we are just entering the market so appreciate the tips!

A slightly different perspective on the commissions and market conditions: we thought we were getting a bargain when we found out it was 4% here... in the US, the standard is 6%! I know NZ was hit hard by the market collapses (as most places were), but in the market we just came out of, people are HUNDREDS of thousands in the hole. So housing prices are still artificially inflated because most can't afford to sell for anything approximating true market value. We're quite happy to be shopping in NZ!, whatever the current challenges!!


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## Song_Si

easy to blame the banks, but when i read _"some borrowers were taking out loans of up to 110 per cent of their home's value and 100 per cent for investment properties"_ . . . easy to see how a negative equity situation arises, the borrowers had none to begin with, add eg 10% interest and it's a disaster in the making.
Late 1980s interest rates were around 20% for mortgages, higher for unsecured loans, knew people then who were forced to sell up to get out of debt situations. I bought my first house then, mortgage at a discounted rate through a government dept - just 15.9%.


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## kiwigser

saltybroad said:


> Great advice about deposits and clauses...we are just entering the market so appreciate the tips!
> 
> A slightly different perspective on the commissions and market conditions: we thought we were getting a bargain when we found out it was 4% here... in the US, the standard is 6%! I know NZ was hit hard by the market collapses (as most places were), but in the market we just came out of, people are HUNDREDS of thousands in the hole. So housing prices are still artificially inflated because most can't afford to sell for anything approximating true market value. We're quite happy to be shopping in NZ!, whatever the current challenges!!


Yes we had our market fall, but as always not over the whole country, Auckland has almost got back to peak. 

Have a look at this website: 
QV - Latest property news


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## Song_Si

hopefully this is a one-off incident, seems they may have hitched a ride with the home owners.

More common are borer (link for info) they are more common in older houses; once got put off buying a property when the building report noted _'borer infestation'_. No thanks.



> *Invader termites found in Waikanae house*
> 27/09/2011
> 
> 
> 
> 
> 
> 
> 
> 
> 
> 
> Thousands of termites from South America, never seen before in New Zealand, have been discovered in a Waikanae home.
> 
> The Ministry of Agriculture and Forestry plan to fumigate the Queens Rd house next month to eradicate colonies of West Indian drywood termite, which is considered one of the most damaging drywood termites internationally because it tunnels into and destroys dry timber.
> 
> If left unchecked, the termites have the potential to significantly damage timber framed homes and impact on the country's sawn timber export industry.
> 
> The home owners returned from working in South America 10 years ago and did not notice the presence of the termites until the past summer when they noticed some flying around - the winged termites are about 1mm in length.
> 
> The family contacted a pest control company which alerted MAF.
> 
> After investigating the termite, which is found in Australia and America, MAF decided to fumigate the house in mid October after the termites' hibernation season.
> 
> MAF Biosecurity response manager Glen Neal says investigations indicate that the colonies of termites in the house are unlikely to have moved beyond the home where they were first detected, but nearby homes will be checked.
> 
> After being fumigated with sulphuryl fluoride imported from Australia, the house will be checked for 10 years.
> 
> Two specialists from Australia will assist a New Zealand team fumigate the house.
> 
> The fumigation and inspection project will cost $400,000.
> 
> source


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## Song_Si

this refers to one franchise, not the whole country; I'll be interested to see how this develops in terms of the customers who have already paid deposits/have part-completed homes.

From the 'home' of Signature Homes website:
_Signature Homes offers the best guarantee programme in N.Z. to its clients, including its industry-leading 'Home Completion Guarantee'​_
*Signature Homes franchise-holder in receivership *
22/11/2011

*Cunningham Building and Construction, the company that holds the Southland franchise of Signature Homes, has been placed in receivership.*

The receivership, which came into effect on Friday last week, was listed on the Companies Office website late yesterday. Recievers Colin Gower and Stephen Tubbs of BDO Christchurch Limited were appointed on Friday. The first receivers' report is due on January 26.

Yesterday, directors of Signature Homes continued to refuse to speak about the company's position despite out-of-pocket tradesmen, angry suppliers and unhappy Signature Homes customers contacting The Southland Times.

read more

and not the first franchise to collapse - further reading: Signature will finish Queenstown house 21 Nov 2011

from same article:









Winton woman Vicki Cameron with the plans for her Signature Home that left her $150,000 out of pocket.
.....Winton residents Vicki and Paul Cameron were left almost $160,000 out of pocket and left to finish building their home themselves when the Otago franchise of Signature Homes owned by Murwil Construction was placed in voluntary liquidation in August 2009.


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## topcat83

Song_Si said:


> this refers to one franchise, not the whole country; I'll be interested to see how this develops in terms of the customers who have already paid deposits/have part-completed homes.
> 
> From the 'home' of Signature Homes website:
> _Signature Homes offers the best guarantee programme in N.Z. to its clients, including its industry-leading 'Home Completion Guarantee'​_
> *Signature Homes franchise-holder in receivership *
> 22/11/2011
> 
> *Cunningham Building and Construction, the company that holds the Southland franchise of Signature Homes, has been placed in receivership.*
> 
> The receivership, which came into effect on Friday last week, was listed on the Companies Office website late yesterday. Recievers Colin Gower and Stephen Tubbs of BDO Christchurch Limited were appointed on Friday. The first receivers' report is due on January 26.
> 
> Yesterday, directors of Signature Homes continued to refuse to speak about the company's position despite out-of-pocket tradesmen, angry suppliers and unhappy Signature Homes customers contacting The Southland Times.
> 
> read more
> 
> and not the first franchise to collapse - further reading: Signature will finish Queenstown house 21 Nov 2011
> 
> from same article:
> 
> 
> 
> 
> 
> 
> 
> 
> 
> Winton woman Vicki Cameron with the plans for her Signature Home that left her $150,000 out of pocket.
> .....Winton residents Vicki and Paul Cameron were left almost $160,000 out of pocket and left to finish building their home themselves when the Otago franchise of Signature Homes owned by Murwil Construction was placed in voluntary liquidation in August 2009.


Most building companies are franchises - which I suppose gives some guarantee if the franchisee goes bust as at least you can then apply for help to the 'mother company'.

But because they are all franchises this also means that the quality can vary from area to area. We did a lot of investigation into building our own house before purchasing a 'nearly new' Golden Home. We're very happy - but the owner who built it was also working for Golden Homes so I guess he could keep an eye on the quality. Another friend of ours built with Golden Homes to the north of Auckland (Silverdale way) and has had nothing except extra costs and bother. They're currently taking them to court over an electricity cable that wasn't buried deep enough (and was subsequently hit by a digger)


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## Song_Si

I think (?) this would be the case in many countries at present as people 'hold tight' rather than borrow more $ for a new house . . . 

*NZ home building activity holds at lowest level in 18yrs*
Monday Dec 5, 2011

*New Zealand residential building activity was little changed in the third quarter at its lowest level in about 18 years.*

The volume of value of building work put in place held unchanged, seasonally adjusted, at the lowest level since the second quarter of 1993, according to Statistics New Zealand. The value of residential work put in place rose 0.6 per cent to $1.3 billion.

Non-residential building activity fell 4.6 per cent in the third quarter, returning to levels last seen in the final three months of 2009. The value of work fell 4.3 per cent to $1.1 billion.

Companies including Fletcher Building, New Zealand's largest construction firm, say weak demand for residential housing is eroding earnings and they're waiting for the rebuild of Christchurch to get underway to help offset slack demand nationally.

"Today's data confirms that the construction sector will act as a drag" on third-quarter economic growth, "although the weakness was not as large as we had feared," said Philip Borkin, economist at Goldman Sachs NZ.


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## Song_Si

*Housing bubble set to burst: Report*
By Anne Gibson
5:30 AM Tuesday Dec 6, 2011

*New Zealand homes are overvalued by 25 per cent and the country is one of nine under threat of a housing bubble burst, says the Economist.*

But the leading international publication's feature report - headlined _House of Horrors_ - has been rubbished by real estate industry insiders.

The _Economist_ ranked New Zealand in the world's top overpriced markets along with Australia, Belgium, Canada, France, Britain, the Netherlands, Spain and Sweden.

It described the nine countries as being at the same stage as the United States towards the peak of its housing bubble.

It said that the countries could be at a danger point and that householders had extremely high levels of borrowings, making them more vulnerable to a house-price shock.

New Zealand's QV agency has found house prices nationally have dropped only 4.4 per cent below the peak in 2007, and yesterday Barfoot & Thompson released data showing the November average selling price rose by 2.5 per cent on October to $567,489, its second-highest average monthly price ever.

The _Economist_ warned that the "bursting of the global housing bubble is only half way through".

But two leading New Zealand real estate agencies rubbished the claims.

Barfoot & Thompson managing director Peter Thompson said house values were set by the buyer and the vendor, and the article was "basically calling all buyers and vendors fools".

He believed the value of homes was influenced by a quickly growing urban population and an increasing housing shortage.

"A lot of the houses these days are sold by auction and when you have limited choice, especially in the inner city, like Mt Eden, Epsom, you get three or four parties that are wanting that one property. That's how the prices go up."

Bayleys senior property research analyst Ian Little said it was "bemusing" when economists assessed the value of homes "on such a broad generalisation".

"In effect, the real assessment of a property's value comes from the market itself - that is, what any one individual is prepared to pay for any one home.

"Those New Zealanders 'trading up' to new homes are doing so with a new-found financial NZ houses 25 per cent too dear: top journal

understanding which has become evident over the past three years.

"People have become extremely 'savvy' with their funds in recent years, and this is reflected in how they value a potential new home, and the offers coming through."

But Shamubeel Eaqub, principal economist for the NZ Institute of Economic Research, said New Zealanders had a housing obsession which he wanted broken.

"Our housing woes are a symptom of a rotting core. Misdirected liquidity and incentives have led to wasteful pursuit of capital gains in housing, rather than entrepreneurship and sustainable economic growth. These are issues we should tackle," Mr Eaqub said, calling for deep structural and political change redress.

Demographia, an international survey, has also regularly found New Zealand housing overpriced. Auckland was labelled the 12th most "severely unaffordable" housing market in its annual survey out in February.

Some economists have challenged Demographia's findings, saying wages are low in New Zealand so comparing those to house prices gives an artificially gloomy view.

Darren Gibbs of Deutsche Bank said inflation-adjusted prices had dropped 15 per cent since the end of 2007. He said prices were now rising in Auckland "and that couldn't be happening if houses were unaffordable".

Calculation devices employed by the _Economist_ to put houses into the over-priced category were a price-to-income ratio and a price-to-rent ratio.

"Based on the average of the two measures," the magazine said, "home prices are overvalued by about 25 per cent or more in Australia, Belgium, Canada, France, New Zealand, Britain, the Netherlands, Spain and Sweden.

"Indeed, in the first four of those countries, housing looks more overvalued than it was in America at the peak of its bubble.


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## anski

*What the property industry experts say*

With the uncertainty of the election over, New Zealand homeowners and buyers are hoping they can look forward to a prosperous 2012; but with unsteady European markets, it is unlikely the New Zealand economy and housing market will remain unscathed.

Property industry heads give Gill South their views of the current situation and what might be in store for us next year.

To read the rest of the article 

What the property industry experts say - Property - NZ Herald News


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## Song_Si

*another building company collapse*

not huge in terms of the finances involved, but sure it is 'huge' for the people involved as unsecured creditors



> *Dream Homes comes to a halt*
> 10/02/2012
> 
> *High-flying Taranaki building company Dream Homes is in financial difficulty. *
> 
> Dream Homes owner Thomas Buckthought and his solicitors held an hour-long meeting with creditors to discuss the company's future yesterday.
> 
> Bruce Richards from Staples Rodway Taranaki accountants attended the meeting and said it was understood Mr Buckthought would go into voluntary liquidation. This would mean creditors were unlikely to get their money back, he said.
> 
> "They'll get nothing," Mr Richards said.
> 
> The Taranaki Daily News understands unsecured creditors will be seeking as much as $700,000 and secured creditors around $800,000.
> 
> It was not known what would happen regarding homeowners who had paid for Dream Homes to build their abodes but left them incomplete.
> 
> read more


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