Latest Commercial Sales

13 properties were sold under the hammer at Bayleys’ Total Property auction today, including 6 of the 9 outlets in the Foundation development at Albany.


Orakei, 78 Coates Avenue, sold for $2.875 million.
Kohimarama, 301-305 Kepa Rd, sold for $2.72 million.
Albany, The Foundation, 270 Oteha Valley Rd, 9 units
Unit 10, Pita Pit, sold for $575,000
Unit 8, Bruce Lee, sold for $580,000
Unit 12, Tank Juice Bar, sold for $580,000
Unit 13, vacant, sold for $480,000
Unit 20, Whisky to Wine, sold for $1 million
Unit 9, Panscape, passed in at vendor bid of $950,000
Unit 14, Oporto, sold for $930,000
Unit 11, Luxury Nail, passed in at vendor bid of $850,000
Unit 19, vacant, no bid
East Tamaki, 3 adjoining properties
2 Newark Place, sold for $1.09 million
6 Newark Place, sold for $822,000
10 Birmingham Rd, no bid
Mt Eden, 11 Tawari St, sold for $1.61 million,
Wiri, 17C Joval Place, sold for $400,000.
CBD, Mid-City, 239 Queen St, unit 1I, passed in at $775,000.
Penrose, 738 Great South Rd, passed in at $1.45 million.
Takapuna, 43 Anzac St, passed in at $3.225 million.
Sandringham, 581 Sandringham Rd, sold for $1.21 million.
Takanini, 268 Great South Rd, withdrawn.
Whangarei, 3 Bank St, no bid.
Papakura, 64 Boundary Rd, passed in at $2.475 million.
CBD, 17 Albert St, unit 9C, no bid
Avondale, 57 Wolverton St, postponed to 6 August

Steep Decline In Mortgage Lending

 

                

Is this the effect of Winter, interest rates rises, the elections

or the end of the bubble?

 
High-LVR lending on rise again, but overall home lending in steep decline
on Monday 28 July 2014
Housing loans above the 80% loan:value ratio jumped by $75 million in May and by another $30 million in June, but a Reserve Bank survey of overall residential lending shows it declined more sharply in July.

The overall housing loan approvals survey, still in its experimental stage, is done weekly on a rolling 13-week basis. It shows just over 7000 approvals in the 13 weeks to 20 July 2012, dropping by 300 a year later, then another fall to 5700 to 18 April this year.

Excluding 2 short weeks with very low figures, quarterly approvals were above 6000 until the last week of June. Since then, quarterly approvals have been below 6000, falling to 5464 in the 13 weeks to 18 July.

A comparison with the same 13 weeks last year shows the number of approvals down 7.3% in mid-April, and a steadily reducing lending rate since then. The reduction was by 17.5% in the quarter to 11 July, 17.1% to 18 July.

Comparing whole years on a rolling weekly basis, the Reserve Bank figures show a 5.8% decline in mid-April, and that decline steadily growing to reach a 9.4% difference at 18 July.

The value of approvals, $1.07 billion for the 13 weeks to 18 April, was above $1.1 billion for all but the quarters ending in the 2 holiday weeks, but dipped to $996 million in the 18 July week. The difference between this year and the same 13 weeks of 2013 has grown from a 7.3% decline in mid-April to a 12% decline at 18 July. Comparing the whole year against the previous year, the decline has gone from 2.9% in April to 6.5% at 18 July.

New loan commitments above the 80% loan:value ratio (LVR) were halved in the first month they were introduced, last October, from $1.187 billion in September to $585 million. They declined sharply every month, down to $147 million in January, but have since been rising, to $358 million in June.

High-LVR loans made up 25.1% of the total in September 2013, were cut to 12.8% in October and fell to 4.8% in January & March. They’ve since risen to 8% of all loans. After construction-lending exemptions, the high-LVR share of mortgages fell from 11.5% last October to 3.6% in January & March, but has steadily risen in the last 3 months to reach 6.7% in June.\(

(BOB DEY)

 

Latest Apartment Sales

4 apartments sold under the hammer out of 6 offered at Ray White City Apartments’ auction today. They included a leasehold unit in Q Central (at the top of Queen St, in photo) with $12,500/year of outgoings, which was marked down to $1473/m².

Q Central, 50 Liverpool St, unit 2A:
Features:
leasehold, 65m², 2 bedrooms
Outgoings: rates $1014/year including gst; body corp levy $3616/year, ground rent $8862/year
Income assessment: $500/week, currently vacant
Outcome: sold for $95,100

Santa Fe, 21 Day St, unit 3:
Features:
82m², 2 bedrooms, balcony, secure parking space; a remedial reclad was completed in 2006
Outgoings: rates $1231/year including gst; body corp levy $3759/year
Income assessment: $550-650/week depending on furnishings
Outcome: passed in at $300,000

Harvard, 147 Hobson St, unit GG:
Features:
37m², 2 bedrooms, parking space
Outgoings: rates $857/year including gst; body corp levy $4496/year
Income assessment: $400/week for the unit, $50/week for the parking space
Outcome: passed in at $195,000

Heritage Tower, 22 Nelson St, unit 911:
Features:
furnished studio, deck
Outgoings: rates $2197/year including gst; body corp levy $5041/year
Income assessment: $522/month + gst; the unit is under hotel management but can become on 30 September
Outcome: sold for $147,500 + gst

Imperial Gardens, 135 Hobson St, unit 521:
Features:
35m², one bedroom, parking space
Outgoings: rates $952/year including gst; body corp levy $3068/year
Income assessment: $380/week until 11 October
Outcome: sold for $227,000

Memphis, 5 Charlotte St, unit 2C:
Features:
65m², one bedroom, garage
Outgoings: rates $1030/year including gst; body corp levy $3117/year
Income assessment: long-term lease just ended
Outcome: sold for $233,000

( Bob Dey)

News Flash! Renting Is Cheaper Than Owning!

It makes one despair when an article such as the one below appears. Renting has always been cheaper than owning for as long as I have been in the business, and well before then too.

How come an expert such as Dominck Stephens of Westpac  has only just woken up to the fact?

Higher interest rates may well make renting even more attractive than before, but that is on the single  view point of money in versus money out .

“Renting or buying is roughly in balance (now),” he says.

Yeah right.

Owing your own home is still the dream of most people, but so is Lotto and the Casino.

I reproduce the article only to demonstrate that the bleeding obvious is still lost on many who are supposed to be knowledgable  in these matters


Mortgage rate rises favour renting vs buying

16/07/2014

As interest rates continue to rise, house prices may fall in the next couple of years, according to a report by Westpac Bank.
And as interest rates rise, the picture will tip in favour of renting, rather than buying, Westpac says.

“Renting or buying is roughly in balance (now),” Westpac chief economist Dominick Stephens said.
Last year when interest rates were low, it was seen as much better to buy a home than rent.
“When mortgage rates have gone up another 1 per cent or so, the decision may well favour renting,” Stephens said.

Asked if it was better to hold off buying now when house prices might fall, he said “I’d be cautious”. Because interest rates were likely to rise and it would be a good idea to fix borrowing costs, but there were still opportunities to invest in property.

Floating mortgage rates are heading towards 8 per cent and fixed term rates to about 7 per cent and may stay up for an extended period as the Reserve Bank tries to tame inflation, especially in the construction sector.

Link:

http://www.stuff.co.nz/business/money/10270520/Mortgage-rate-rises-favour-renting-vs-buying

Rogue Landlords & Managers Accused

I find this story hard to believe.

There may be a few rogue landlords or managers around but they would be totally out numbered by the number rogue tenants. The quicker the Residential Tenancy Act is overhauled to reflect true fairness  – or better still abolished all together – the sooner we will have a mature and civilised rental market

Rental agents ‘milking’ tenants
TESS MCCLURE
14/07/2014

Rental agents in Christchurch’s tight housing market are “milking” vulnerable tenants by charging them to renew their lease,  social agencies say.
The practice has been labelled “contentious” and welfare organisations want it banned.

Selina, who did not want her last name used, had been living in her home for more than a year when the lease came up for renewal. This year, however, it came with a price tag: $450 in “letting fees”.
“I couldn’t believe it,” Selina said.
“$450 just for signing a piece of paper? This is taking food out my kids’ mouths.”
Selina’s rent had increased $50 in the last year.

A single mother with four children, she has a fixed income and said riding out the rent increases was “hard enough”.
When the unexpected bill hit she was afraid of losing her home.
Her rental agent would not back down.
With the help of the Mayor’s Welfare Fund, Selina could eventually cover the cost. However, she was already terrified of her next renewal.
“I’m worried I’m gonna be in the same boat next year,” she said.

Letting fees were designed for agents to cover the cost of setting up a new tenancy.
In Christchurch, tenants simply renewing leases are being faced with bills of up to $1000.
By law, letting fees must be a fair and reasonable representation of the cost of re-leasing a home.
There is no cap on the amount charged, but common practice is one week’s rent plus GST.
One rental agent, who wished to remain anonymous, said tenants should not pay renewal fees.
“There’s no admin involved in renewing a tenancy except changing the date in the system,” the agent said.
Tenant’s Protection Agency manager Helen Gatonyi said tenants could approach the tenancy tribunal about renewal fees, but many were afraid of losing their homes if they spoke up.

Link:

http://www.stuff.co.nz/business/money/find-a-home/10262953/Rental-agents-milking-tenants

Lates House Sales Statistics

House sales continue slide

14/07/2014


House sales in June continued to drag their heels, although the national median price was supported by housing-short Auckland and Christchurch.
Figures from the Real Estate Institute of New Zealand showed the number of house sales fell 6.1 per cent in the year to June and 12.3 per cent on the previous month.

Houses were taking 39 days to sell, five days longer than a year ago.
But the national house price continued to defy gravity at $427,250, virtually flat against May but up 8.4 per cent on a year ago.

link:

http://www.stuff.co.nz/business/money/10264381/House-sales-continue-slide

Confidence Still Strong

Asking price of homes remained at record levels during May
June 13th, 2014 |


The average asking price of homes remains at record levels, not only in Auckland but across the country.

The national average asking price of house sellers in May was $483,524, only marginally below the all time record set in March of $484,263. In Auckland, the average asking price was $685,246, practically the same as the new record set in April of $685,426.  In Wellington the average asking price in May was $453,850, while Canterbury came to $442,784.

Despite the strong prices sought by sellers, there are still plenty of Kiwis looking for homes to buy throughout the country.  Traffic to Realestate.co.nz has risen 50% over the last 12 months, showing that buyer interest hasn’t dissipated. And traffic from mobile devices specifically, including smartphones and tablets, has grown by 90% in the last year.

link:

http://unconditional.co.nz/blog/propertyreport-may/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+unconditionalconz+%28Unconditional.co.nz%29

Where And When To Buy


Is now a good time to buy property in Auckland?
Tamsyn Parker

NZ Herald
Jul 8, 2014
Four experts give their views

Is it a bad idea to buy a property in Auckland?
Property prices in Auckland are continuing to rise despite lending restrictions and higher interest rates pushing up the cost of borrowing.
Figures released yesterday by QV show the Auckland market increased 12.3 per cent year on year and values are up 31.4 per cent since 2007 peak.
NZ Herald.co.nz talked to four experts about the issue...

Property consultant Olly Newland says renting is cheaper than owning at the moment but renting has its own pitfalls.
"I agree that renting is cheaper than owning at the moment but you are always at the mercy of the landlord."
Newland says buying a house gives the home-owner access to potential capital growth and at the same time they are paying off a mortgage.
"Interest rates are still historically low. Prices have gone up crazily in some areas but not everywhere."
Newland says while certain areas in Auckland have skyrocketed in price if you go south there is still options for under $450,000 in Clevedon or Takanini.
He predicted higher house prices in central Auckland would drive the gentrification of outer neighbourhoods like Panmure and Glen Innes.
Newland also warned that rents were likely to rise with landlords expected to pass on increased interest rate costs.

Read the whole article here:

http://www.nzherald.co.nz/personal-finance/news/article.cfm?c_id=12&objectid=11289606

 

Guaranteeing a mortgage for others, family or not, can be fraught with danger. Anyone considering that should get sound financial advice before signing on the dotted line.

Some of the points to consider:

(1) Is the guarantee for a fixed period or for the term of the loan?

(2) Is the guarantee for a fixed amount or all encompassing?

(3) At what point will the guarantee be allowed to lapse?

(4) Is the guarantee joint or several?

If you don’t know or what to find out more  contact us for advice.

First-home buyers use parents as guarantors

DEIDRE MUSSEN
08/07/2014

Twice as many Wellington first-home buyers are using parents as guarantors for mortgages since a tougher deposit criterion was introduced last October, according to a Wellington mortgage broker. \
The latest monthly property values, issued yesterday, highlighted major challenges for the capital's first-home buyers because few city properties had a price tag under $400,000.
That put many homes beyond their reach thanks to the 20 per cent deposit cap imposed by the Reserve Bank last October.

"We are seeing some first-home buyers finding ways around the caps, for instance by getting parental guarantees," QV Wellington registered valuer Kerry Buckeridge said.
Wellington mortgage broker Craig Pope agreed, saying first-home buyers were forced to be "creative" about meeting bank criteria to get a mortgage.

About one in 10 of his clients used family as guarantors for their mortgages, double the number relying on that help before the Reserve Bank introduced the tougher loan-to-value ratios.
However, he believed the biggest change had been increasing numbers of people using KiwiSaver to augment their deposit - about 60 per cent.
"That has been a massive help for home buyers. As time goes on, more people fit the criteria and can use KiwiSaver to buy a house."
KiwiSaver had two features to assist people buying their first home, including its deposit subsidy and savings withdrawal schemes. Under the deposit subsidy, people could withdraw up to $5000 if they had been in KiwiSaver for    more than three years.

Statistics from Housing New Zealand, which managed the subsidy scheme, showed its payouts to first-home buyers had increased exponentially during the past three years.

Read the rest here:

http://www.stuff.co.nz/business/money/mortgages/10241956/First-home-buyers-use-parents-as-guarantors

Smaller Industrial Units – Sales Results

Industrial units sell at similar prices, vacant or tenanted 8 July 2014  
2 small warehouse units in a cul-de-sac off Rosedale Rd on the North Shore – one vacant, the other with a tenant – sold at similar prices a square metre at Colliers International’s auction today. The vacant unit went for $1880/m² and the occupied unit went for $8/m² more. An Onehunga property, where 3 warehouses have been combined into one business unit, was passed in without a bid. 3B Henry Rose Place: Features: 241m² – 113m² warehouse, 128m² office & amenities, 6 parking spaces Rent: $30,000/year Outcome: sold for $455,000 at 6.6% yield, $1888/m² 3G Henry Rose Place: Features: 258m² – warehouse 138m², low-stud storage & workshop 52m², entry, stairs, amenities & office 68m², 7 parking spaces Rent: vacant Outcome: sold for $485,000 at $1880/m² 22 Patrick St: Onehunga Features: 1971m² site, established tenant in recently refurbished 1508m² of building – 1141m² in 3 adjoining warehouses, office & amenity 232m², storage 47m², canopy 85m² Rent: $154,844/year net, 3% annual Outcome: passed in at vendor’s bid of $2 million Attr