1
00:00:06,000 --> 00:00:09,080
Speaker 1: Cielda. I'm Chelsea Daniels and this is the Front Page,

2
00:00:09,520 --> 00:00:17,279
Speaker 1: a daily podcast presented by the New Zealand Herald. The

3
00:00:17,360 --> 00:00:21,599
Speaker 1: government has unvowed grand plans to flood the market with

4
00:00:21,760 --> 00:00:25,840
Speaker 1: more houses, announcing new changes to planning rules that will

5
00:00:25,880 --> 00:00:30,000
Speaker 1: require councils to plan for thirty years of housing growth.

6
00:00:30,520 --> 00:00:33,480
Speaker 1: It comes after Housing Minister Chris Bishop said he wants

7
00:00:33,520 --> 00:00:37,600
Speaker 1: to see house prices fall. He's already getting his wish though,

8
00:00:37,880 --> 00:00:40,519
Speaker 1: with prices dropping to a point that in some of

9
00:00:40,560 --> 00:00:45,200
Speaker 1: the country's biggest cities homeowners are delisting their properties rather

10
00:00:45,240 --> 00:00:51,040
Speaker 1: than selling for a discount. So we're flooding the housing

11
00:00:51,120 --> 00:00:54,600
Speaker 1: market work in a country where owning a property is

12
00:00:54,680 --> 00:00:58,560
Speaker 1: the cornerstone of our economy. Today, on the front page,

13
00:00:58,720 --> 00:01:03,160
Speaker 1: Opus Partners economist Ed McKnight joins us to give his

14
00:01:03,320 --> 00:01:11,680
Speaker 1: take on the state of the property market. Ed, can

15
00:01:11,720 --> 00:01:14,279
Speaker 1: you give us a lay of the land? How house

16
00:01:14,319 --> 00:01:16,399
Speaker 1: prices faring on average at the moment?

17
00:01:16,640 --> 00:01:19,399
Speaker 2: Well, we had a bit of a bump between May

18
00:01:19,920 --> 00:01:23,959
Speaker 2: last year and right up until February this year in

19
00:01:24,000 --> 00:01:27,039
Speaker 2: twenty twenty four, but since February we've actually been on

20
00:01:27,080 --> 00:01:30,080
Speaker 2: a bit of a slow decline. So if I take

21
00:01:30,120 --> 00:01:32,280
Speaker 2: people back a couple of years. We all know that

22
00:01:32,319 --> 00:01:35,520
Speaker 2: the housing market peaked in end of twenty twenty one,

23
00:01:35,600 --> 00:01:38,039
Speaker 2: kind of November twenty twenty one, and for eighteen months

24
00:01:38,040 --> 00:01:41,440
Speaker 2: after that, house prices fell about eighteen percent. So this

25
00:01:41,520 --> 00:01:44,760
Speaker 2: big drop the largest drop we've actually ever seen in

26
00:01:44,800 --> 00:01:47,880
Speaker 2: the history since we started tracking house prices back in

27
00:01:47,960 --> 00:01:50,760
Speaker 2: nineteen ninety two. So we had this massive drop. Then

28
00:01:51,360 --> 00:01:53,920
Speaker 2: house prices for about nine months they crept up just

29
00:01:54,040 --> 00:01:57,160
Speaker 2: over five percent, and now they've gone down about three

30
00:01:57,200 --> 00:01:59,160
Speaker 2: percent in the last couple of months. So we've had

31
00:01:59,160 --> 00:02:01,600
Speaker 2: this big drop, a little bit of a recovery, and

32
00:02:01,640 --> 00:02:02,760
Speaker 2: now a bit of a slide.

33
00:02:02,880 --> 00:02:06,040
Speaker 1: I understand in areas like Northland and Auckland, for example,

34
00:02:06,040 --> 00:02:10,919
Speaker 1: people actually delisting their homes because the prices aren't high enough.

35
00:02:11,040 --> 00:02:13,040
Speaker 1: Are things really that bad at the moment?

36
00:02:13,240 --> 00:02:15,560
Speaker 2: Well, the interesting thing is before we ran the start,

37
00:02:15,760 --> 00:02:18,840
Speaker 2: nobody had actually ever looked at this before. And the

38
00:02:18,840 --> 00:02:21,919
Speaker 2: truth of the matter is, over the last call it

39
00:02:22,120 --> 00:02:26,120
Speaker 2: seven years, somewhere between a third and forty percent of

40
00:02:26,200 --> 00:02:30,440
Speaker 2: properties come to mark it and are then eventually delisted.

41
00:02:30,880 --> 00:02:32,960
Speaker 2: So we have this idea that, yeah, if a property

42
00:02:32,960 --> 00:02:35,480
Speaker 2: comes to market, it will definitely sell, but most of

43
00:02:35,520 --> 00:02:38,000
Speaker 2: the time a third of properties don't end up selling

44
00:02:38,040 --> 00:02:40,680
Speaker 2: because sellers will say, well, you know, I'm not really

45
00:02:40,720 --> 00:02:43,359
Speaker 2: sure if I'm happy selling it for that price. Now,

46
00:02:43,440 --> 00:02:45,520
Speaker 2: at the moment we have seen a bit of an

47
00:02:45,560 --> 00:02:48,519
Speaker 2: increase over the last six months. We were seeing more

48
00:02:48,600 --> 00:02:52,640
Speaker 2: properties be delisted, but it isn't that high by historical

49
00:02:52,720 --> 00:02:56,480
Speaker 2: standards now as you've identified Auckland and Northland though, that's

50
00:02:56,520 --> 00:02:59,720
Speaker 2: where we're seeing most properties be delisted at the moment.

51
00:02:59,800 --> 00:03:03,600
Speaker 2: Some places like Wellington only fourteen percent of properties are

52
00:03:03,639 --> 00:03:06,280
Speaker 2: being delisted, so there's a very high sell through rate

53
00:03:06,800 --> 00:03:07,960
Speaker 2: in the capital. At the moment.

54
00:03:08,360 --> 00:03:11,880
Speaker 1: We seem to be always bothered about something, right, house

55
00:03:11,919 --> 00:03:14,480
Speaker 1: prices are too high. Now they're too low, and people

56
00:03:14,520 --> 00:03:18,080
Speaker 1: are delisting and investors are getting worried. When do you

57
00:03:18,080 --> 00:03:19,360
Speaker 1: think we'll actually be happy.

58
00:03:19,919 --> 00:03:23,080
Speaker 2: Never. We'll never be happy with house prices. And the

59
00:03:23,160 --> 00:03:25,480
Speaker 2: reason is that somebody is always going to be grumpy

60
00:03:25,480 --> 00:03:28,800
Speaker 2: about something. Even if you take the interest rate debate.

61
00:03:29,000 --> 00:03:31,040
Speaker 2: It's so funny. I was on news talk, said b

62
00:03:31,520 --> 00:03:35,200
Speaker 2: talking about interest rates falling, and anybody with a half

63
00:03:35,280 --> 00:03:38,960
Speaker 2: sized mortgage at the moment is really excited about interest

64
00:03:39,000 --> 00:03:41,000
Speaker 2: rates falling. Oh, gosh, yes, that will save us so

65
00:03:41,080 --> 00:03:43,880
Speaker 2: much money. Well, we had one person call up and say, no,

66
00:03:44,200 --> 00:03:46,360
Speaker 2: I don't want the interest rates to go down because

67
00:03:46,520 --> 00:03:48,520
Speaker 2: I'm a retiree. I've got a lot of money in

68
00:03:48,560 --> 00:03:50,040
Speaker 2: the bank at the moment and I want to earn

69
00:03:50,080 --> 00:03:54,360
Speaker 2: a decent income of it. So whenever somebody's happy about something,

70
00:03:54,360 --> 00:03:57,240
Speaker 2: whether it be interesst rates falling or house prices going up,

71
00:03:57,360 --> 00:04:00,280
Speaker 2: somebody else is always going to be unhappy. And those

72
00:04:00,320 --> 00:04:02,600
Speaker 2: are the voices we tend to hear most loudly, because

73
00:04:02,640 --> 00:04:05,160
Speaker 2: when people are happy, they don't shout from the rooftops

74
00:04:05,160 --> 00:04:07,640
Speaker 2: about it. When someone's grumpy, though, you know you're going

75
00:04:07,680 --> 00:04:08,360
Speaker 2: to hear about it.

76
00:04:08,680 --> 00:04:11,960
Speaker 1: The governments announced its plans to flood the market with

77
00:04:12,200 --> 00:04:15,880
Speaker 1: housing by freeing up more land for housing developments with

78
00:04:15,960 --> 00:04:18,599
Speaker 1: the plan of making land and housing cheaper.

79
00:04:20,640 --> 00:04:25,080
Speaker 3: These targets will require councils to live zone feasible development

80
00:04:25,160 --> 00:04:28,560
Speaker 3: capacity to provide for at least thirty years of housing

81
00:04:28,600 --> 00:04:33,400
Speaker 3: demand at any one time. Feasible development capacity means housing

82
00:04:33,440 --> 00:04:36,320
Speaker 3: capacity that is commercially viable for a developer to build

83
00:04:36,720 --> 00:04:39,920
Speaker 3: at a profit. In effect, this will flood the market

84
00:04:39,920 --> 00:04:43,520
Speaker 3: with opportunities for development and over time drive down land

85
00:04:43,520 --> 00:04:45,400
Speaker 3: prices and the cost of housing.

86
00:04:51,520 --> 00:04:53,159
Speaker 1: What do you make of these changes and do you

87
00:04:53,160 --> 00:04:54,640
Speaker 1: think it will actually work well.

88
00:04:54,680 --> 00:04:57,800
Speaker 2: I think the Housing Minister christ Bishop is talking a

89
00:04:57,920 --> 00:05:00,720
Speaker 2: big game, and certainly he's incentivized to do that. Lots

90
00:05:00,720 --> 00:05:03,920
Speaker 2: of people want house prices to be stable over the

91
00:05:04,080 --> 00:05:06,920
Speaker 2: very very long term. I think there will be some

92
00:05:07,279 --> 00:05:10,159
Speaker 2: benefits to it. For instance, they're saying they are going

93
00:05:10,200 --> 00:05:13,880
Speaker 2: to remove any minimum requirement about how big a house

94
00:05:14,000 --> 00:05:16,479
Speaker 2: or an apartment has to be. That will mean we

95
00:05:16,520 --> 00:05:19,280
Speaker 2: get more smaller sized departments built. On top of that,

96
00:05:19,560 --> 00:05:22,240
Speaker 2: councils won't be able to have a say in terms

97
00:05:22,240 --> 00:05:25,719
Speaker 2: of whether apartments have to have balconies or not, or

98
00:05:25,760 --> 00:05:28,560
Speaker 2: how large those balconies have to be. With all of

99
00:05:28,600 --> 00:05:31,359
Speaker 2: those rules gone, we should see some cheaper and certainly

100
00:05:31,480 --> 00:05:35,159
Speaker 2: smaller apartments coming through. And at the margin, yeah, maybe

101
00:05:35,160 --> 00:05:37,880
Speaker 2: a couple more developers will build those sorts of properties,

102
00:05:37,960 --> 00:05:40,040
Speaker 2: and that will be good for people who are okay

103
00:05:40,080 --> 00:05:43,360
Speaker 2: and happy to live in slightly smaller properties. I always

104
00:05:43,520 --> 00:05:46,480
Speaker 2: take what politicians say with a grain of salt, because

105
00:05:46,480 --> 00:05:48,440
Speaker 2: they're very good at saying that they're going to do

106
00:05:48,520 --> 00:05:52,120
Speaker 2: something big and meaningful and then it doesn't always materialize,

107
00:05:52,120 --> 00:05:54,000
Speaker 2: and I'll give you an example of that. The Housing

108
00:05:54,040 --> 00:05:56,880
Speaker 2: Minister is saying that they want every single council in

109
00:05:56,920 --> 00:06:01,080
Speaker 2: the country to open up or zone two years of

110
00:06:01,200 --> 00:06:05,680
Speaker 2: population growth, and often christ Church is the shining example

111
00:06:06,040 --> 00:06:09,560
Speaker 2: that the government holds up because immediately after the earthquakes

112
00:06:09,680 --> 00:06:12,520
Speaker 2: they zoned for thirty years of population growth. There was

113
00:06:12,560 --> 00:06:15,440
Speaker 2: a lot of housing being built and for a time

114
00:06:15,760 --> 00:06:19,000
Speaker 2: house prices were pretty flat down in christ Church. But

115
00:06:19,080 --> 00:06:21,160
Speaker 2: what a lot of people miss is that during the

116
00:06:21,200 --> 00:06:25,480
Speaker 2: COVID boom from twenty nineteen onwards, christ Church house prices

117
00:06:25,560 --> 00:06:28,880
Speaker 2: actually increased at a much faster rate than the likes

118
00:06:28,880 --> 00:06:32,839
Speaker 2: of Wellington, Auckland or Dunedin. And so I'm not sure

119
00:06:32,920 --> 00:06:35,159
Speaker 2: whether zoning a whole heap of land is going to

120
00:06:35,200 --> 00:06:38,320
Speaker 2: fix all of the problem, but it will certainly help.

121
00:06:38,720 --> 00:06:42,280
Speaker 1: We've already seen the growth of new builds in Auckland,

122
00:06:42,480 --> 00:06:45,480
Speaker 1: for example, outpaced population growth. So what do we need

123
00:06:45,560 --> 00:06:47,160
Speaker 1: to keep building more houses?

124
00:06:47,320 --> 00:06:49,120
Speaker 2: Well, if I take you back a couple of years,

125
00:06:49,160 --> 00:06:51,960
Speaker 2: every single media outlet, including the Herald, was talking about

126
00:06:52,000 --> 00:06:54,960
Speaker 2: a massive housing crisis and we needed to build more

127
00:06:54,960 --> 00:06:57,039
Speaker 2: and more and more homes. I think this is just

128
00:06:57,200 --> 00:06:58,240
Speaker 2: part of the catch up.

129
00:06:58,720 --> 00:07:02,119
Speaker 1: Do you worry about their plan to remove the urban

130
00:07:02,240 --> 00:07:03,440
Speaker 1: rural boundaries?

131
00:07:04,000 --> 00:07:07,280
Speaker 2: I worry more about the infrastructure. It's quite interesting because

132
00:07:07,279 --> 00:07:10,600
Speaker 2: if you remove the rural urban boundary, you're going to

133
00:07:10,640 --> 00:07:13,360
Speaker 2: get more housing sprawl, right, so you are likely to

134
00:07:13,360 --> 00:07:17,120
Speaker 2: see more housing built out Pocono Way just south of Auckland,

135
00:07:17,400 --> 00:07:19,760
Speaker 2: and also down in Poocacoe and some of those more

136
00:07:19,920 --> 00:07:23,640
Speaker 2: rural communities. Now, that obviously has benefits and drawbacks. The

137
00:07:23,640 --> 00:07:26,520
Speaker 2: benefit is that if I am a person who is

138
00:07:26,560 --> 00:07:28,760
Speaker 2: willing to live an hour out of the city because

139
00:07:28,800 --> 00:07:32,120
Speaker 2: I want a standalone house where property prices are a

140
00:07:32,200 --> 00:07:35,080
Speaker 2: bit cheaper and I want that kind of lifestyle, I

141
00:07:35,160 --> 00:07:36,760
Speaker 2: kind of think, well, why do we have all of

142
00:07:36,800 --> 00:07:39,920
Speaker 2: these rules in place? But we also know that we're

143
00:07:39,960 --> 00:07:42,640
Speaker 2: not so good at building infrastructure here in New Zealand.

144
00:07:42,840 --> 00:07:44,280
Speaker 2: So all good, we're going to get rid of the

145
00:07:44,360 --> 00:07:47,720
Speaker 2: rural urban boundary. But now it's Auckland Council and Auckland

146
00:07:47,760 --> 00:07:51,160
Speaker 2: Council rate payers who are now responsible for building that

147
00:07:51,320 --> 00:07:54,760
Speaker 2: infrastructure that goes in there to support those houses. Now, yes,

148
00:07:54,800 --> 00:07:57,880
Speaker 2: the developers have to pay some taxes what's called development

149
00:07:57,960 --> 00:08:01,480
Speaker 2: contributions in order to build those properties, but often my

150
00:08:01,640 --> 00:08:04,640
Speaker 2: understanding is that a lot of that infrastructure is ultimately

151
00:08:04,680 --> 00:08:06,440
Speaker 2: financed by the poor old ratepayer.

152
00:08:06,680 --> 00:08:10,200
Speaker 1: Those plans to decide the minimum size of new apartments,

153
00:08:10,240 --> 00:08:12,520
Speaker 1: could that see kind of like an influx of shoebox

154
00:08:12,640 --> 00:08:15,400
Speaker 1: style apartments, the ones that we see I'm thinking in Japan,

155
00:08:15,560 --> 00:08:17,679
Speaker 1: you know, one by one meter, et cetera.

156
00:08:17,920 --> 00:08:19,800
Speaker 2: Well, that is the risk if you don't have a

157
00:08:19,880 --> 00:08:22,800
Speaker 2: rule in place. A developer will build them if they

158
00:08:22,840 --> 00:08:25,120
Speaker 2: think they can sell them, and if they think they

159
00:08:25,120 --> 00:08:28,520
Speaker 2: can make more money by selling those shoe box apartments

160
00:08:29,040 --> 00:08:32,400
Speaker 2: compared to building something else. So ultimately it comes down

161
00:08:32,440 --> 00:08:36,640
Speaker 2: to what are home buyers or investors willing to purchase.

162
00:08:36,960 --> 00:08:39,720
Speaker 2: And if an investor is buying those kinds of shoebox

163
00:08:39,760 --> 00:08:42,000
Speaker 2: apartments and saying, yeah, okay, I'll buy that at whatever

164
00:08:42,040 --> 00:08:44,600
Speaker 2: price the developer are selling it for, whether people are

165
00:08:44,720 --> 00:08:48,720
Speaker 2: actually willing to rent those properties, I can ciertably foresee

166
00:08:48,720 --> 00:08:51,360
Speaker 2: a future where there are a lot of studio apartments built.

167
00:08:51,760 --> 00:08:54,679
Speaker 2: Investors then purchase them, and there we have new stories

168
00:08:54,720 --> 00:08:57,720
Speaker 2: about how small these properties are and the rents that

169
00:08:57,760 --> 00:08:59,760
Speaker 2: people are paying for them. But it ultimately comes down

170
00:08:59,800 --> 00:09:01,960
Speaker 2: to what are people willing to build, what are people

171
00:09:02,040 --> 00:09:05,720
Speaker 2: willing to buy? And what are people willing to rent?

172
00:09:16,800 --> 00:09:19,240
Speaker 1: The average wage in New Zealand is currently what about

173
00:09:19,400 --> 00:09:22,040
Speaker 1: fifty three thousand dollars? Doesn't that put the dream of

174
00:09:22,080 --> 00:09:26,240
Speaker 1: home ownership out of many young Kiwi's grasps. This idea

175
00:09:26,240 --> 00:09:29,040
Speaker 1: of a kind of nuclear family of the fifties and

176
00:09:29,080 --> 00:09:32,160
Speaker 1: sixties isn't really the benchmark anymore, is it. People are

177
00:09:32,200 --> 00:09:35,680
Speaker 1: staying single and childless for longer. What are the options

178
00:09:35,679 --> 00:09:38,000
Speaker 1: out there when a home costs roughly a million dollars,

179
00:09:38,040 --> 00:09:42,040
Speaker 1: say for a single woman working as a host in Auckland, Well.

180
00:09:41,960 --> 00:09:44,559
Speaker 2: It's very difficult if you're a single person. But that

181
00:09:44,800 --> 00:09:48,600
Speaker 2: median wage is quite misleading when we're thinking about house prices,

182
00:09:48,760 --> 00:09:50,760
Speaker 2: because we've got to think about, well, what is the

183
00:09:50,840 --> 00:09:54,120
Speaker 2: average household income? The average household income in New Zealand

184
00:09:54,240 --> 00:09:56,880
Speaker 2: is actually about one hundred and thirty k. Just over that,

185
00:09:57,200 --> 00:10:00,000
Speaker 2: the average household income in Auckland does about a hund

186
00:10:00,360 --> 00:10:01,920
Speaker 2: fifty nine thousand dollars.

187
00:10:02,080 --> 00:10:03,960
Speaker 1: Would you look that It'd be couples though, wouldn't it.

188
00:10:04,040 --> 00:10:06,920
Speaker 2: Yeah, that'd primarily be for couples, And so certainly if

189
00:10:06,960 --> 00:10:10,040
Speaker 2: you are a single person it is very, very difficult

190
00:10:10,080 --> 00:10:13,520
Speaker 2: if you think about the average household, though, buying your

191
00:10:13,640 --> 00:10:16,720
Speaker 2: first property is still achievable, and we actually see that

192
00:10:16,800 --> 00:10:20,160
Speaker 2: in the numbers. In fact, almost a quarter of properties

193
00:10:20,200 --> 00:10:23,640
Speaker 2: purchased over the last six months have been purchased by

194
00:10:23,760 --> 00:10:25,920
Speaker 2: first home buyers. Now, of course there are as many

195
00:10:25,920 --> 00:10:28,160
Speaker 2: properties being transacted at the moment because it's quite a

196
00:10:28,679 --> 00:10:31,720
Speaker 2: slow market, but first home buyers are getting out there

197
00:10:31,920 --> 00:10:35,640
Speaker 2: and doing their best, actually buying up quite a large

198
00:10:35,679 --> 00:10:38,679
Speaker 2: percentage of homes, a larger percentage of homes than they

199
00:10:38,679 --> 00:10:40,720
Speaker 2: almost ever have been. So it's a great time to

200
00:10:40,720 --> 00:10:41,680
Speaker 2: be a first home buyer.

201
00:10:41,960 --> 00:10:45,400
Speaker 1: When we look at those figures on first home buyers, though,

202
00:10:45,679 --> 00:10:48,960
Speaker 1: there's no differentiation between whether it's a couple or a

203
00:10:49,000 --> 00:10:49,680
Speaker 1: single person.

204
00:10:50,280 --> 00:10:53,240
Speaker 2: Definitely not. And what I'd say there is that buying

205
00:10:53,240 --> 00:10:55,880
Speaker 2: a house is a single person is difficult and probably

206
00:10:55,920 --> 00:10:58,559
Speaker 2: has always been difficult. If you're a couple, it obviously

207
00:10:58,720 --> 00:11:01,439
Speaker 2: is a lot easier. But what I'd also say that

208
00:11:01,600 --> 00:11:04,439
Speaker 2: is the median age of buys their first home is

209
00:11:04,480 --> 00:11:06,800
Speaker 2: currently thirty seven in New Zealand, and I think we

210
00:11:06,920 --> 00:11:09,319
Speaker 2: sometimes think that, oh, well, you know, the average person

211
00:11:09,320 --> 00:11:12,760
Speaker 2: buys their first home in their twenties and then gradually

212
00:11:12,760 --> 00:11:14,400
Speaker 2: pays it off. It's actually quite a bit older. So

213
00:11:14,440 --> 00:11:16,760
Speaker 2: I'm often saying to people, well, if you're purchasing it

214
00:11:17,200 --> 00:11:20,200
Speaker 2: thirty five or thirty six, that's still great. That is

215
00:11:20,440 --> 00:11:24,000
Speaker 2: below the average. And hey, if you're forty buying your

216
00:11:24,000 --> 00:11:27,160
Speaker 2: first home, it's actually not that late because the average

217
00:11:27,200 --> 00:11:30,319
Speaker 2: or median firm and buyer is aged thirty six point

218
00:11:30,360 --> 00:11:31,120
Speaker 2: seven years old.

219
00:11:31,520 --> 00:11:34,080
Speaker 1: That makes me actually feel a little bit better. Do

220
00:11:34,160 --> 00:11:37,360
Speaker 1: you think I should stop buying avocado and toast?

221
00:11:38,360 --> 00:11:42,440
Speaker 2: I think that buying avocadao toast isn't necessarily the issue.

222
00:11:42,559 --> 00:11:44,960
Speaker 2: I don't even think avocadavo toast is as popular as

223
00:11:44,960 --> 00:11:47,200
Speaker 2: it used to be. But back around that kind of

224
00:11:47,240 --> 00:11:50,920
Speaker 2: twenty fifteen twenty sixteen, it was incredibly popular. That's what

225
00:11:50,960 --> 00:11:53,920
Speaker 2: all of us millennials were out there buying at the cafes.

226
00:11:54,120 --> 00:11:57,720
Speaker 2: And there's probably some grubby old sixty five year old

227
00:11:58,320 --> 00:12:01,600
Speaker 2: who owns fifty proper that they bought for you know,

228
00:12:01,679 --> 00:12:05,240
Speaker 2: a couple of rasberries back in the fifties probably said

229
00:12:05,280 --> 00:12:07,520
Speaker 2: something along those lines which it came up for. But

230
00:12:07,600 --> 00:12:09,520
Speaker 2: I do want to dig into that point around well,

231
00:12:09,559 --> 00:12:12,400
Speaker 2: what about the single people? It obviously is very difficult.

232
00:12:12,480 --> 00:12:14,679
Speaker 2: Whenever you look at any piece of data, you can

233
00:12:14,720 --> 00:12:17,320
Speaker 2: look at it in two ways. Right. You can say, Okay,

234
00:12:17,360 --> 00:12:19,640
Speaker 2: it's very difficult for single people to go out and

235
00:12:19,640 --> 00:12:21,920
Speaker 2: purchase their first time but that is absolutely true. But

236
00:12:22,000 --> 00:12:24,960
Speaker 2: there are also some positive signs out there that I

237
00:12:24,960 --> 00:12:28,120
Speaker 2: don't think get enough media attention, like the average age

238
00:12:28,120 --> 00:12:30,280
Speaker 2: to buy your first time, or like the fact that

239
00:12:30,400 --> 00:12:33,280
Speaker 2: the average household income in New Zealand is around that

240
00:12:33,320 --> 00:12:36,360
Speaker 2: one hundred and thirty two k, even though the median

241
00:12:36,520 --> 00:12:38,360
Speaker 2: wage is fifty three grand.

242
00:12:38,800 --> 00:12:41,520
Speaker 1: More people are being pushed into the rental market. I

243
00:12:41,640 --> 00:12:44,959
Speaker 1: see a record four hundred and ten thousand rental bonds

244
00:12:44,960 --> 00:12:48,400
Speaker 1: were lodged by November twenty twenty three. That's up thirty

245
00:12:48,440 --> 00:12:51,600
Speaker 1: eight percent from twenty ten. Some of these new housing

246
00:12:51,640 --> 00:12:54,520
Speaker 1: developments are built to rent schemes. Is that a good

247
00:12:54,559 --> 00:12:57,120
Speaker 1: idea when so many people aren't able to get onto

248
00:12:57,160 --> 00:12:58,760
Speaker 1: the property ladder already?

249
00:12:58,960 --> 00:13:01,120
Speaker 2: I think it's definitely there important because the truth of

250
00:13:01,160 --> 00:13:04,400
Speaker 2: the matter is not everybody is able to purchase their

251
00:13:04,440 --> 00:13:07,000
Speaker 2: own home, certainly not straight away. And one of the

252
00:13:07,040 --> 00:13:10,199
Speaker 2: things I've got to remember is even when home ownership

253
00:13:10,280 --> 00:13:14,120
Speaker 2: was at its highest in New Zealand, twenty six percent

254
00:13:14,160 --> 00:13:18,080
Speaker 2: of households still rented. Now it's not just because some people,

255
00:13:18,520 --> 00:13:20,400
Speaker 2: no matter what happens, they're not going to be able

256
00:13:20,440 --> 00:13:22,880
Speaker 2: to get a mortgage. There's kind of a stage of

257
00:13:22,920 --> 00:13:26,280
Speaker 2: life thing here. So when I was twenty two years old, yes,

258
00:13:26,320 --> 00:13:28,320
Speaker 2: I was renting because I didn't have the deposit yet

259
00:13:28,360 --> 00:13:31,160
Speaker 2: to go ahead and purchase the first time. When I

260
00:13:31,200 --> 00:13:33,560
Speaker 2: was at university, there was no way in hell I

261
00:13:33,600 --> 00:13:35,319
Speaker 2: was going to be able to purchase the first time.

262
00:13:35,400 --> 00:13:37,320
Speaker 2: Of course I had to rent. So there's this section

263
00:13:37,679 --> 00:13:41,319
Speaker 2: of the population that, no matter what's happening to house prices,

264
00:13:41,559 --> 00:13:44,680
Speaker 2: around a quarter of us will always need to be

265
00:13:44,800 --> 00:13:47,319
Speaker 2: able to rent. And as New Zealand's houses get older

266
00:13:47,360 --> 00:13:50,600
Speaker 2: and older, yeah, we need new houses being built so

267
00:13:50,640 --> 00:13:54,000
Speaker 2: we can have somewhere safe, warm and dry to rent.

268
00:13:54,000 --> 00:13:55,920
Speaker 2: So I think it's important that there are people out

269
00:13:55,920 --> 00:13:58,360
Speaker 2: there building new properties for renters.

270
00:13:58,559 --> 00:14:00,880
Speaker 1: So you know what the new government's thinking and what

271
00:14:00,920 --> 00:14:03,920
Speaker 1: their approach is. Labour's still working on its future tax

272
00:14:04,080 --> 00:14:08,760
Speaker 1: policy plans, but Finance spokesperson Barbara Edmunds has hinted that

273
00:14:08,800 --> 00:14:13,320
Speaker 1: there needs to be a change to discourage property investment.

274
00:14:15,440 --> 00:14:18,840
Speaker 4: We need to remove this incentive that the tax system

275
00:14:18,880 --> 00:14:22,720
Speaker 4: provides for qs to invest in property. Yeah, a seller

276
00:14:22,760 --> 00:14:25,400
Speaker 4: in wag Juna who's a cleaner gets every dollar of

277
00:14:25,440 --> 00:14:28,120
Speaker 4: what they've earned tax, but doesn't get the capital tax.

278
00:14:28,320 --> 00:14:31,280
Speaker 4: We get higher wages when we produce more things, so

279
00:14:31,520 --> 00:14:32,720
Speaker 4: there has to be a balance there.

280
00:14:35,840 --> 00:14:36,240
Speaker 2: She says.

281
00:14:36,240 --> 00:14:40,600
Speaker 1: New Zealand's obsessed with housing investment. Is this a fair

282
00:14:40,640 --> 00:14:43,800
Speaker 1: assumption and could this possibly ever be curbed?

283
00:14:44,320 --> 00:14:47,160
Speaker 2: I do think Kiwis are very interested in property, but

284
00:14:47,200 --> 00:14:50,120
Speaker 2: I think that's because we need it. Everybody talks about, oh,

285
00:14:50,200 --> 00:14:52,920
Speaker 2: property investors are making so much money. But there's a

286
00:14:52,960 --> 00:14:54,480
Speaker 2: flip side to this as well, which is that New

287
00:14:54,600 --> 00:14:58,160
Speaker 2: Zealand needs regial accommodation right and it can't be provided

288
00:14:58,160 --> 00:15:00,520
Speaker 2: by the government. If you think about all of the

289
00:15:00,560 --> 00:15:04,360
Speaker 2: properties that are actually provided out there for renters, only

290
00:15:04,480 --> 00:15:08,920
Speaker 2: fifteen percent is provided by the government or by community

291
00:15:08,920 --> 00:15:13,200
Speaker 2: housing providers. Eighty five percent of rental accommodation is provided

292
00:15:13,240 --> 00:15:15,360
Speaker 2: by mums and dads who put their own house on

293
00:15:15,400 --> 00:15:17,360
Speaker 2: the line most of the time to borrow a lot

294
00:15:17,400 --> 00:15:19,240
Speaker 2: of money to go and buy a house. Now do

295
00:15:19,280 --> 00:15:21,000
Speaker 2: they expect or do they hope that they're going to

296
00:15:21,040 --> 00:15:22,560
Speaker 2: make a few bob out of it and that it's

297
00:15:22,600 --> 00:15:25,480
Speaker 2: going to help them for their retirement. Absolutely, they hope that.

298
00:15:25,720 --> 00:15:29,080
Speaker 2: But at the same time, we need people out there

299
00:15:29,200 --> 00:15:31,800
Speaker 2: owning rental accommodation, and in many cases, I think of

300
00:15:31,840 --> 00:15:34,480
Speaker 2: it a bit like the supermarkets. So we need people

301
00:15:34,480 --> 00:15:36,960
Speaker 2: who are going to be out there providing food so

302
00:15:37,000 --> 00:15:39,600
Speaker 2: we can all cook dinner on a Wednesday or Thursday

303
00:15:39,680 --> 00:15:42,800
Speaker 2: night before we sit down and watch some Netflix. But

304
00:15:43,880 --> 00:15:45,840
Speaker 2: is it fair that the supermarkets make money? I guess

305
00:15:45,920 --> 00:15:48,240
Speaker 2: we need the supermarkets to make some amount of money.

306
00:15:48,280 --> 00:15:50,360
Speaker 2: We can argue how much it is, but we need

307
00:15:50,480 --> 00:15:53,080
Speaker 2: owning a supermarket to be profitable so that there are

308
00:15:53,320 --> 00:15:55,760
Speaker 2: supermarkets that provide us with food and groceries.

309
00:15:56,080 --> 00:15:59,600
Speaker 1: And do home owners looking to sell have to wait

310
00:15:59,640 --> 00:16:02,280
Speaker 1: for ends rest rates to fall before listing their properties

311
00:16:02,480 --> 00:16:04,240
Speaker 1: or should they just buy the bullet now if the

312
00:16:04,240 --> 00:16:06,880
Speaker 1: market is truly set to be flooded by new homes.

313
00:16:07,320 --> 00:16:09,800
Speaker 2: In many ways, I think it depends what you're trying

314
00:16:09,840 --> 00:16:11,840
Speaker 2: to do. You know, most people say, well, if you're

315
00:16:11,880 --> 00:16:14,080
Speaker 2: buying and selling in the same market, so if you're

316
00:16:14,080 --> 00:16:16,280
Speaker 2: selling your own home to go and buy something, it

317
00:16:16,280 --> 00:16:18,560
Speaker 2: doesn't really matter. But the way that I think about

318
00:16:18,600 --> 00:16:22,040
Speaker 2: it is. If you are trying to buy a bigger, better,

319
00:16:22,240 --> 00:16:25,560
Speaker 2: more expensive house, it's generally better to do it when

320
00:16:25,600 --> 00:16:29,600
Speaker 2: house prices are lower, because that upgrade isn't quite as

321
00:16:29,640 --> 00:16:32,000
Speaker 2: expensive and you've got more time to do it now.

322
00:16:32,040 --> 00:16:35,520
Speaker 2: If you're doing the opposite, if you're downsizing, you generally

323
00:16:35,560 --> 00:16:37,960
Speaker 2: want to do it when house prices are really high,

324
00:16:38,080 --> 00:16:40,960
Speaker 2: because then you're maximizing the difference between what you sell

325
00:16:41,080 --> 00:16:42,320
Speaker 2: for and what you buy for.

326
00:16:42,680 --> 00:16:45,640
Speaker 1: And for those looking to buy their first home like

327
00:16:45,800 --> 00:16:48,200
Speaker 1: me in Auckland, is there any hope there at all?

328
00:16:48,560 --> 00:16:50,320
Speaker 1: Or do I need to consider moving to perhaps to

329
00:16:50,320 --> 00:16:51,000
Speaker 1: the West Coast.

330
00:16:51,160 --> 00:16:53,800
Speaker 2: I don't know how much you d your situation, Chelsea,

331
00:16:53,880 --> 00:16:56,360
Speaker 2: but I can tell you there is hope out there

332
00:16:56,400 --> 00:16:59,160
Speaker 2: for you. And I think it's important that we acknowledge

333
00:16:59,160 --> 00:17:01,800
Speaker 2: both the bad side, as often happens, but also a

334
00:17:01,800 --> 00:17:04,040
Speaker 2: good data that says, actually, it's a great time to

335
00:17:04,040 --> 00:17:06,960
Speaker 2: be a first home buyer. There are fewer properties out

336
00:17:07,000 --> 00:17:09,200
Speaker 2: there that are going up for auction now. First home

337
00:17:09,240 --> 00:17:12,280
Speaker 2: buyers hate auctions because every time you put your hand

338
00:17:12,320 --> 00:17:15,679
Speaker 2: up it's an unconditional offer. That means that before you

339
00:17:15,760 --> 00:17:17,840
Speaker 2: even raise your hand at auction, you as a first

340
00:17:17,840 --> 00:17:20,359
Speaker 2: home buyer need to get a pre approval from the bank.

341
00:17:20,640 --> 00:17:22,800
Speaker 2: That takes time. You've got to do all of your

342
00:17:22,840 --> 00:17:25,960
Speaker 2: checks beforehand, like getting a building inspector getting your lawyer

343
00:17:26,040 --> 00:17:27,520
Speaker 2: to look at the property. And if you do that

344
00:17:27,560 --> 00:17:30,200
Speaker 2: for a couple of different auctions, it starts to get really,

345
00:17:30,240 --> 00:17:33,000
Speaker 2: really expensive. So the fact that it's taking longer for

346
00:17:33,080 --> 00:17:35,880
Speaker 2: properties to sell, the fact that fewer properties are coming

347
00:17:35,960 --> 00:17:38,280
Speaker 2: up at auction, the fact that there is a higher

348
00:17:38,359 --> 00:17:41,360
Speaker 2: percentage or a very high percentage of first home buyers

349
00:17:41,520 --> 00:17:43,680
Speaker 2: purchasing properties at the moment, they make out a big

350
00:17:43,720 --> 00:17:45,840
Speaker 2: part of the market. I think it's really good for you,

351
00:17:45,960 --> 00:17:48,240
Speaker 2: and we need to acknowledge that it is a buyer's market,

352
00:17:48,320 --> 00:17:50,240
Speaker 2: so you, as a buyer have the upper hand.

353
00:17:51,359 --> 00:17:59,680
Speaker 1: Thanks for joining us. Ed that's it for this episode

354
00:17:59,720 --> 00:18:02,679
Speaker 1: of The Front Page. You can read more about today's

355
00:18:02,720 --> 00:18:06,440
Speaker 1: stories and extensive news coverage at enzied Herald dot co

356
00:18:06,680 --> 00:18:10,600
Speaker 1: dot nz. The Front Page is produced by Ethan Sills

357
00:18:10,680 --> 00:18:15,639
Speaker 1: and sound engineer Patti Fox. I'm Chelsea Daniels. Subscribe to

358
00:18:15,680 --> 00:18:19,400
Speaker 1: the Front Page on iHeartRadio or wherever you get your podcasts,

359
00:18:19,720 --> 00:18:23,280
Speaker 1: and tune in on Monday for another look behind the headlines,