Posts tagged papatoetoe
Property market predictions for the rest of 2019

The activity in the residential property market indicates a continued steady pace and values holding well for the second half of 2019.

Key factors to watch for will be the policy decisions from the Reserve Bank (e.g. LVR and bank capital rules), the landscape for investors’ returns, the potential flattening off of residential building consents, and how buildings insurance premiums might change due to risk based pricing.

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1. Sales volumes to stay pretty flat, with various downward drivers (e.g. slowing GDP growth) largely offset by other positive factors (e.g. low mortgage rates).

2. Average property values still rising but in a restrained fashion, with the more affordable towns and cities in ‘regional NZ’ likely to record the largest increases. By contrast, it wouldn’t be a surprise to see further weakness in Auckland – as buyers bide their time.

3. Further loosening of the LVR rules in November, reflecting our expectation of steady market conditions. Possible options include lowering the owner-occupier deposit requirement from 20% to 15% and/or raising the investor speed limit for high LVR lending from 5% to 10%.

4. Imposition of extra capital requirements on the banks by the end of November, with a phased approach (potentially over five years). This may prompt some consideration of offering different mortgage rates to borrowers with different abilities to service their debt.

5. Banking sector competition to remain intense and ‘rate wars’ to be a recurring theme - regardless of whether or not the Reserve Bank cuts the official cash rate again.

6. Foreign Buyer Ban to remain a contributing factor to softness in the Central Auckland and Queenstown property markets.

7. More homeowners potentially ‘trading up’, or in other words taking advantage of a subdued market, especially in Auckland, to get a bigger or newer property, or in a better location.

8. Rental yields to continue to rise (albeit from a low base), as rental growth continues at a steady pace of about 5% annually, and above the growth in average property values.

9. Residential building consents to flatten off, as capacity constraints around labour and materials bite. However, they will still stay high, and that’ll be necessary to help alleviate housing shortages. A looming ‘re-set’ for KiwiBuild could have implications here too.

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Manukau's property market wrap

The recent sales data from REINZ (NZ's most accurate and up-to-date information provider) shows prices remain stable and flat however the good news — Manukau was up 1.4% this month with a new median sale price of $797,000.

The days on market for both Manukau and across Auckland were 45 days and a total of 379 sales were settled across Manukau last month.

Open home numbers and enquiry continues to be pretty good though on the whole, especially on properties under $1M (comparative to a few months ago).

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Median house prices

The median house prices in Manukau were up by 1.4% this month. In Auckland, this number increased by 1.2% compared to this time last year from $850,000 to $860,000 — the highest price the region has seen for 2019 so far. Across NZ, the median house prices increased by 3.2% in May to $578,000, up from $560,000 in May 2018.

Properties sold

In Auckland, the number of properties sold in May fell by -21.8% from this time last year, however, there was a 13.0% lift in the number of properties sold when we compare May to April.

Days on market

Auckland saw the median number of days to sell a property increase by 5 days from 40 to 45 when compared to the same time last year.

Listings

This morning just 2,187 properties were available on realestate.co.nz in Manukau, so it’s still dropping a few percent each week. I thought it may actually hold or even lift with the last of the post-holiday campaigns hitting the market this past and next week, but that doesn’t appear to the case. As winter nears closer, listings continue to fall.

General commentary

Recent Statistics NZ data shows that population growth remains strong, low interest rates remain and confirmation that there will be no capital gains tax or even an extension of the five year Brightline test indicates positive things for the property market.

Continued stability moving forward is definitely expected, and is what we are already seeing with stock turning over just a little bit better as both vendors and buyers have now adjusted to the new environment.

LVR Policies

The RBNZ didn’t announce any changes to the current LVR policies in their FS report recently. Maybe these will come in November and change in January, as has happened for the past couple of years. But remember they will (likely) only relax them if housing lending continues to decline, and the easing of the property market extends throughout the rest of NZ (currently just Auckland). So, essentially, only if things get worse.

Therefore one could say that if they don’t make adjustments come November, it’s because the market has improved, or at least, isn’t getting any worse. Either way, both are good outcomes. If we were to see cuts, it will likely be in both the 30% minimum deposit for investors and 20% minimum deposit for owner-occupiers — both by 5%.

How to add value in the kitchen on a budget
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Here are some tips on how to get the best out of your existing kitchen without breaking the bank.

1. Ease and flow

First ask yourself if your kitchen functions well or are there some things about it that have always driven you crazy. Is the pantry too small, is the dishwasher too far from the sink or the rubbish bin, is there never enough storage or are the cupboards too high? Consider whether moving an appliance or rejigging those cupboards could significantly improve the flow of your kitchen.

2. A good clean and a lick of paint

One of the simplest ways to freshen up your kitchen is with a coat of paint. Keep it light, airy and neutral – be sure to pick a shade that works with your existing counters and cabinets. Ask for advice at your local paint shop or when in doubt, white is usually a safe bet. A professional clean is a worthwhile investment and should include ceilings and walls. Fly spots and food splatters are big detractors to an otherwise sparkling kitchen.

3. Update your hardware

Updating your cupboards with new handles can give your kitchen a more contemporary feel, but make sure they are still in keeping with the overall style of the room.

4. Declutter storage spaces

Make sure your cupboards and open shelves are clean, orderly and decluttered. Potential buyers will be looking inside your cupboards, and if they are overflowing it gives the impression that the storage space in your kitchen is inadequate.

5. Let the light in

Consider the lighting in your kitchen – you’re looking for that bright, airy feel. Good lighting will make your kitchen seem bigger, brighter and will make it more functional too. No one wants to cook or entertain in a dark, poorly lit kitchen.

6. Help buyers imagine it as their own

Your kitchen may be very personal to you and your tastes, but now is the time to make it clean, simple and neutral. Give buyers a clean canvas to work with.

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