1 00:00:00,240 --> 00:00:02,520 Speaker 1: These days, we're always looking for any little clue that 2 00:00:02,600 --> 00:00:05,360 Speaker 1: the old normal is coming back. It was the fifth 3 00:00:05,440 --> 00:00:09,440 Speaker 1: anniversary of the pandemic yesterday. I don't think the new 4 00:00:09,480 --> 00:00:12,600 Speaker 1: normal is coming back. So let's look at houses. Asb 5 00:00:13,039 --> 00:00:16,160 Speaker 1: lowered its house price inflation forecast for this year, it's 6 00:00:16,280 --> 00:00:19,239 Speaker 1: chief economist Nick Toughly reckons the pickup in sales has 7 00:00:19,320 --> 00:00:21,759 Speaker 1: been sluggish. He says there's a lot of stock on 8 00:00:21,800 --> 00:00:24,959 Speaker 1: the market. They believe prices will fall to the first 9 00:00:24,960 --> 00:00:27,400 Speaker 1: half of this year. Therefore, the bank has more than 10 00:00:27,440 --> 00:00:31,000 Speaker 1: halved its house price growth forecast for twenty twenty five 11 00:00:31,040 --> 00:00:34,839 Speaker 1: from just or to just three point four percent when 12 00:00:34,880 --> 00:00:37,279 Speaker 1: it used to be nine three point four percent. That's 13 00:00:37,320 --> 00:00:40,400 Speaker 1: the capital growth you can expect. That's more in line 14 00:00:40,440 --> 00:00:42,960 Speaker 1: with inflation than for a long time. In other words, 15 00:00:42,960 --> 00:00:44,760 Speaker 1: buying a house at the moment is no longer the 16 00:00:44,800 --> 00:00:48,000 Speaker 1: path to automatic capital gain. Question is how long will 17 00:00:48,000 --> 00:00:50,640 Speaker 1: it last. Anyway, face with the fact that it's just 18 00:00:50,680 --> 00:00:54,080 Speaker 1: three point four percent of house inflation, house owners are 19 00:00:54,120 --> 00:00:56,520 Speaker 1: more likely to stay put. And you remember, back in 20 00:00:56,560 --> 00:00:58,400 Speaker 1: the old normal, churn was the name of the game. 21 00:00:58,440 --> 00:01:01,360 Speaker 1: You'd often buy and sell a lot to climb up 22 00:01:01,400 --> 00:01:04,320 Speaker 1: through the property ladder. I went through five houses in 23 00:01:04,400 --> 00:01:08,760 Speaker 1: five years to get to a better place. In today's climate, 24 00:01:08,760 --> 00:01:10,480 Speaker 1: you're more likely to stay in any house you own 25 00:01:10,480 --> 00:01:12,039 Speaker 1: because a bird in the hand is worth two in 26 00:01:12,040 --> 00:01:14,640 Speaker 1: the bush. And you want some stability, because stability and 27 00:01:14,680 --> 00:01:17,039 Speaker 1: security is now the new normal. So this is why 28 00:01:17,040 --> 00:01:19,360 Speaker 1: we've got more stock. And this, you have to say, 29 00:01:19,440 --> 00:01:22,320 Speaker 1: is more in line with overseas models where people stay 30 00:01:22,319 --> 00:01:25,840 Speaker 1: in their houses for longer, accepting the limitations of the 31 00:01:25,880 --> 00:01:29,039 Speaker 1: market and building a day to day life that they 32 00:01:29,040 --> 00:01:31,759 Speaker 1: can count on. Now in New Zealand, we've been through 33 00:01:31,800 --> 00:01:35,479 Speaker 1: boom and bust periods before and prices have always come back. 34 00:01:35,520 --> 00:01:38,160 Speaker 1: It's sort of like, oh, they always come back. It'll 35 00:01:38,160 --> 00:01:42,000 Speaker 1: come back, mate, But what if they don't? Is that 36 00:01:42,040 --> 00:01:44,920 Speaker 1: such a bad thing. People have often said that our 37 00:01:44,959 --> 00:01:48,720 Speaker 1: property fixation has been at the expense of real productivity growth. Anyway, 38 00:01:48,720 --> 00:01:50,880 Speaker 1: what will happen next is anyone's guest. But I'll tell 39 00:01:50,880 --> 00:01:53,240 Speaker 1: you something else. The bank pointed out something that I 40 00:01:53,280 --> 00:01:57,080 Speaker 1: got worried about. Immigration levels are staying stubbornly low after 41 00:01:57,160 --> 00:02:00,520 Speaker 1: booming right after the pandemic. We are not in attractive 42 00:02:00,560 --> 00:02:04,360 Speaker 1: destination and maybe that's because of the image we're presented 43 00:02:04,360 --> 00:02:08,880 Speaker 1: of ourselves as a basketplace economy. So look, anyway, maybe 44 00:02:08,880 --> 00:02:11,240 Speaker 1: the housing crisis is over, maybe we're going to have 45 00:02:11,240 --> 00:02:13,840 Speaker 1: a stable economy. But I'll tell you one thing. It's 46 00:02:13,880 --> 00:02:16,640 Speaker 1: not a get rich quick paradise anymore right now, but 47 00:02:17,120 --> 00:02:19,600 Speaker 1: it is a nice place to live. For more from 48 00:02:19,639 --> 00:02:22,919 Speaker 1: Early Edition with Ryan Bridge. Listen live to news Talks 49 00:02:22,960 --> 00:02:26,200 Speaker 1: it be from five am weekdays, or follow the podcast 50 00:02:26,240 --> 00:02:27,160 Speaker 1: on iHeartRadio.