1 00:00:00,000 --> 00:00:02,280 Speaker 1: And more evidence that we have a resuscitation of sorts 2 00:00:02,320 --> 00:00:04,760 Speaker 1: of the New Zealand real estate market. You call logic data. 3 00:00:04,800 --> 00:00:07,880 Speaker 1: This shows we're back to the best levels of affordability 4 00:00:08,560 --> 00:00:10,560 Speaker 1: since COVID. So what's going on here? Call logics to 5 00:00:10,600 --> 00:00:12,960 Speaker 1: your property economist is of course Kelvin Davidson, who's back 6 00:00:12,960 --> 00:00:15,600 Speaker 1: with this. Calvin morning, Good morning. So let's look at 7 00:00:15,600 --> 00:00:17,520 Speaker 1: these factors. You've got prices, you've got wages, you've got 8 00:00:17,520 --> 00:00:20,119 Speaker 1: interest rates. Are they all sort of playing their part 9 00:00:20,120 --> 00:00:22,480 Speaker 1: at the moment we're mixing them up into something sweet 10 00:00:22,480 --> 00:00:22,920 Speaker 1: and lovely? 11 00:00:23,920 --> 00:00:26,279 Speaker 2: Oh? Well, absolutely. I mean, look what's happened in the 12 00:00:26,320 --> 00:00:29,080 Speaker 2: past for the two or three years. Prices down twenty percent, 13 00:00:29,880 --> 00:00:32,320 Speaker 2: incomes have gone up some percentage over that time. I 14 00:00:32,360 --> 00:00:33,800 Speaker 2: don't have to state off the top of my head. They've 15 00:00:33,800 --> 00:00:35,879 Speaker 2: send have gone up. And of course the biggie is 16 00:00:36,000 --> 00:00:39,080 Speaker 2: mortgage rates. You know that those sharp falls really putting 17 00:00:39,200 --> 00:00:42,080 Speaker 2: cash back in people's pockets and making them more confident 18 00:00:42,240 --> 00:00:43,360 Speaker 2: training in the housing market. 19 00:00:43,520 --> 00:00:46,280 Speaker 1: Do you have to move now? Is this a sweet 20 00:00:46,320 --> 00:00:47,680 Speaker 1: spot before it's too late or not? 21 00:00:49,479 --> 00:00:51,440 Speaker 2: I think most fears about the market over the next 22 00:00:51,440 --> 00:00:54,120 Speaker 2: couple of years are still fairly cautious and then yes, 23 00:00:54,400 --> 00:00:57,040 Speaker 2: mortgage rates we've seen before the impact they have. But 24 00:00:57,560 --> 00:00:59,320 Speaker 2: at the same time, the economy is still a little 25 00:00:59,320 --> 00:01:01,880 Speaker 2: bit so there's still a lot of this things. It's 26 00:01:01,880 --> 00:01:05,440 Speaker 2: definitely still a biased market, and we've got debt to 27 00:01:05,480 --> 00:01:08,600 Speaker 2: income ratio restrictions this time, which we aren't doing anything 28 00:01:08,680 --> 00:01:11,280 Speaker 2: right now, but it's sort of lurking out. They're ready 29 00:01:11,319 --> 00:01:14,560 Speaker 2: to restrict loans if and when mortgage rates get even last. 30 00:01:14,640 --> 00:01:16,960 Speaker 2: So I think there's there's a few reasons to be cautious. 31 00:01:17,160 --> 00:01:18,399 Speaker 1: I'm told investors are back. 32 00:01:19,640 --> 00:01:21,880 Speaker 2: Yeah, they definitely are. You see said that in because 33 00:01:21,880 --> 00:01:25,000 Speaker 2: the market share for investors has been rising for six 34 00:01:25,000 --> 00:01:27,360 Speaker 2: and nine months and now it's probably back to about 35 00:01:27,400 --> 00:01:30,560 Speaker 2: where it normally is, so big changes for investors, and 36 00:01:30,600 --> 00:01:32,840 Speaker 2: of course tax bills have got smaller. But I think 37 00:01:32,880 --> 00:01:36,399 Speaker 2: really it's again about those mortgage rates. You have a 38 00:01:36,400 --> 00:01:38,280 Speaker 2: low mortgage rate, the top ups that you have to 39 00:01:38,280 --> 00:01:41,520 Speaker 2: put into a new rental property ownsburg and I guess 40 00:01:41,560 --> 00:01:43,120 Speaker 2: that's just turning activity around. 41 00:01:43,440 --> 00:01:46,559 Speaker 1: The bank's writing money. Are people flooding and going yes please? 42 00:01:47,480 --> 00:01:51,280 Speaker 2: Yeah, the mortgage lending has definitely picked up, and it's 43 00:01:51,320 --> 00:01:54,640 Speaker 2: been driven a lot by certainly trading houses. But also 44 00:01:54,640 --> 00:01:57,080 Speaker 2: we have seen a bit of bank switching activity. So 45 00:01:57,760 --> 00:02:01,440 Speaker 2: now those are the ability or people on floating rates 46 00:02:01,480 --> 00:02:03,840 Speaker 2: or short fixes, so they do actually have the ability 47 00:02:03,840 --> 00:02:04,600 Speaker 2: to switch banks. 48 00:02:04,760 --> 00:02:06,160 Speaker 1: Interesting, we're actually. 49 00:02:05,840 --> 00:02:08,000 Speaker 2: Sitting there a bit going on, and I guess some 50 00:02:08,120 --> 00:02:10,200 Speaker 2: keen deals from some of the banks have been entitled 51 00:02:10,280 --> 00:02:10,920 Speaker 2: people across. 52 00:02:11,080 --> 00:02:13,640 Speaker 1: Now you're commentary on rentals. Now what I thought there 53 00:02:13,680 --> 00:02:16,440 Speaker 1: was a flood of rentals on the market, therefore prices 54 00:02:16,440 --> 00:02:18,360 Speaker 1: were going down. Why are you trying to tell us 55 00:02:18,360 --> 00:02:19,080 Speaker 1: that things are tight? 56 00:02:20,520 --> 00:02:22,919 Speaker 2: So at the moment, the ratio of rents to household 57 00:02:22,960 --> 00:02:25,160 Speaker 2: incomes is at a record high, and I guess it 58 00:02:25,200 --> 00:02:27,840 Speaker 2: reflects what's happened over previous years. We did see a 59 00:02:27,840 --> 00:02:31,200 Speaker 2: big rental boom that pushed rents up in relationship incomes. 60 00:02:31,200 --> 00:02:33,680 Speaker 2: That that rental boom has pizzas out. And I mean 61 00:02:33,720 --> 00:02:36,440 Speaker 2: rents aren't necessarily falling. You don't tend to see them 62 00:02:36,480 --> 00:02:38,760 Speaker 2: fall very much. They tend to flatten off. And I 63 00:02:38,800 --> 00:02:40,680 Speaker 2: guess that's sort of just what's happened in the past 64 00:02:40,720 --> 00:02:43,639 Speaker 2: twelve or eights in months, But certainly attendant's market, there 65 00:02:43,680 --> 00:02:46,200 Speaker 2: is a lot of choice out there. Net migrations come down. 66 00:02:46,360 --> 00:02:49,040 Speaker 2: So yeah, just a little bit difficult for landlords to 67 00:02:49,080 --> 00:02:51,240 Speaker 2: be pushing through rent increases at the moment. But at 68 00:02:51,240 --> 00:02:53,880 Speaker 2: the same time, you don't tend to see rents fall. 69 00:02:54,040 --> 00:02:55,519 Speaker 2: There could be a flattering period. 70 00:02:55,440 --> 00:02:58,120 Speaker 1: Good stuff for come. Appreciate the expertise as always, Kelvin Davidson, 71 00:02:58,160 --> 00:02:59,680 Speaker 1: Core Logic, Chief Property and Manner. 72 00:03:00,120 --> 00:03:02,880 Speaker 2: For more from The Mic Asking Breakfast, listen live to 73 00:03:03,000 --> 00:03:06,079 Speaker 2: news Talks at B from six am weekdays, or follow 74 00:03:06,120 --> 00:03:07,679 Speaker 2: the podcast on iHeartRadio.