Tuesday, May 14, 2013

The New Zealand Housing Market - Tumble Weed Alert

If you were a bit cynical like me, you might think the Real Estate industry here in New Zealand was keeping deliberately quiet about the latest house price figures for April 2013.

You see, the figures aren't so good. OK, so its not they are that bad, however the the prices are down 3% overall in New Zealand and 1.25% specifically in Auckland.

No headlines spruiking the increase in house values and buy now before they get higher talk. Nope, just tumble weed blowing through that abandoned marketing hoohaa . The silence says it all.

Next month there could well be an increase, but the latest falls are signalling a stalling top.

Cautioning young house-hunters right now should be the mantra of all involved in the housing industry. Coaxing young workers into large mortgages could almost be considered .... but I shouldn't really say that.

Banks have been at the forefront of this frenzy to lend the easy money gained from the US, Japan and European money printing craziness. Foistering their wares on starry eyed house investors. Since when did banks care anyway, after all, next time they get into trouble they are taking at least 10% of YOUR money through bail-ins. Don't think so? Think again, think Cyprus.

Note too that once the Chinese, who make up a considerable portion of the current Auckland market, get spooked by government policy (subsidised housing) or Council rhetoric (opening up green fields) then watch this market bubble burst in a hurry.

Tomorrow we look at the housing verses gold chart for April 2013.

Gold in New Zealand dollars: $1736.00 per oz
Previous all-time high: $2311.02 per oz (15 Nov, 2011)

Silver in New Zealand dollars: $28.53 per oz
Previous all-time high: $59.19 per oz (30 Apr, 2011)
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