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Speaker 1: You're listening to the Saturday Morning with Jack Team podcast

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Speaker 1: from News Talks at b when.

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Speaker 2: We're talking personal finance with Ed McKnight from Opie's Partners.

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Speaker 2: Good morning, sir, Great to talk to you Jack. You

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Speaker 2: know what it feels like, elections come around faster and

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Speaker 2: faster and faster. Maybe that's just my job, but also

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Speaker 2: maybe that is just the experience of anyone who keeps

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Speaker 2: even a cursory eye on the housing market. Because it's funny.

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Speaker 2: In election year, it feels like the date itself and

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Speaker 2: the uncertainty that comes with elections looms over the property market.

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Speaker 3: Well, that's exactly right, and in fact, so many things

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Speaker 3: routinely impact the property market and we can see that.

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Speaker 3: So what I've done is analyze the last eleven MMP

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Speaker 3: elections going back to nineteen ninety three, and looked for

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Speaker 3: patterns about what almost always happens. And what I've found

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Speaker 3: is this a pretty clear trend. Actually, so before the

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Speaker 3: election and up until about a month after the election,

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Speaker 3: kiwis do routinely by fewer houses. Now it's not by

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Speaker 3: a huge amount, it's by kind of somewhere between four

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Speaker 3: to ten percent. Fewer houses before the election and then

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Speaker 3: on average they start making up for lost time after it.

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Speaker 3: And I think what this does come down to is

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Speaker 3: the uncertainty about the outcome, the uncertainty about the policy

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Speaker 3: settings or what might happen afterwards. It just makes some

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Speaker 3: people decide to hold back a little bit, delay that

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Speaker 3: big decision, delay taking out that mess of mortgage or switching,

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Speaker 3: hopes of just saying, oh, wait and see what happens

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Speaker 3: after the election. And I think we all kind of

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Speaker 3: knew or sense that that might be the case. But

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Speaker 3: it's interesting to see that once you look at the data, Hey,

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Speaker 3: that's what actually happens.

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Speaker 2: Yeah, that's interesting. Does if you're going through those different

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Speaker 2: elections and the different results and then mapping it onto

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Speaker 2: activity in the housing market or plopping it against activity

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Speaker 2: in the housing market, can you see any discernible difference

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Speaker 2: depending on who wins?

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Speaker 3: You actually do? I was a little bit surprised by

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Speaker 3: this now bearing by just before I tell you what

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Speaker 3: the results actually are, because we're only looking at eleven elections.

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Speaker 3: I think six of them were won by national, five

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Speaker 3: of them were won by labor, and so we are

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Speaker 3: talking about a very very very small sample size. But

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Speaker 3: when I do split it out like that. We have

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Speaker 3: seen historically that property sales so people buy more houses

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Speaker 3: when national ones. Now that could be for a few reasons, yes, okay,

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Speaker 3: maybe one part is that people think that national might

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Speaker 3: be better for housing policy despite the fact that here's a

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Speaker 3: curly one four you jack. House prices have tended to

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Speaker 3: go up faster under labor than national in the past.

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Speaker 3: But putting that aside, some people think that national might

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Speaker 3: be better for housing policy, so they might pile in.

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Speaker 2: Some of it also.

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Speaker 3: Comes down to just when national have gotten in the past.

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Speaker 3: So if I think about the two most recent times

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Speaker 3: where a national government came in, one happened in the GFC.

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Speaker 3: Now John Key comes in, and what happens is the

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Speaker 3: property market was already in the middle of a downturn

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Speaker 3: right and then we had a rapid recovery. So did

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Speaker 3: we see how sales increase when national came in because

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Speaker 3: John Key got it or was it because there was

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Speaker 3: a recovery happening anyway from the GENFC? And then even

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Speaker 3: if we look at the last election, think about what

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Speaker 3: was happening there. We were in the middle of this

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Speaker 3: absolute housing market downturned. We were well below average in

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Speaker 3: terms of how many properties were being purchased. Then Christopher

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Speaker 3: Luxin gets it. Now, did he change all the policies

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Speaker 3: and back the housing market will better? No, but we

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Speaker 3: started buying more houses because that was the sickly that

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Speaker 3: was the right part of the cycle where people were

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Speaker 3: going to start to purchase more houses. So that's where

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Speaker 3: I've just tried to be a little bit careful and say, hey,

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Speaker 3: it's not all doubt of the politicians. Yes, sometimes it's

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Speaker 3: just what's happening in the property market at the time.

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Speaker 2: It's the old correlation versus causation situation, Right, You've got

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Speaker 2: to be very care So I'm glad that you've given

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Speaker 2: us that you know that that precursor, because that's a

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Speaker 2: very important point. What does this mean though, for people

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Speaker 2: who are thinking about purchasing property property at the moment.

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Speaker 2: Is there anything that can kind of take out of

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Speaker 2: this Well.

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Speaker 3: I think there's a little bit of an opportunity for

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Speaker 3: the wily people out there who are planning a purchase

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Speaker 3: and think, Okay, I know that the property market's going

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Speaker 3: to be a bit quieter in the call it six

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Speaker 3: months before the election. Maybe if I'm not so worried

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Speaker 3: about who's going to get in because I'm buying this

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Speaker 3: for myself to live in. Right, I'm going to eat

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Speaker 3: a house where the labor or national wins the election.

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Speaker 3: If I know that the market's going to be a

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Speaker 3: little bit quieter, maybe I can negotiate a bit. And

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Speaker 3: maybe you start saying to the real estate agent, well,

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Speaker 3: you know the election is going to make a lot

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Speaker 3: of people uncertain. Maybe I'll hold off, but actually, if

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Speaker 3: I can get a good price, if you accept this

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Speaker 3: lower price, yeah, I'll do the deal before the election,

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Speaker 3: because we all know that's going to be If it's

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Speaker 3: quite a market, we can use that to our advantage.

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Speaker 2: Yeah, right, that makes total sense. That's very interesting. Thank

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Speaker 2: you for crunching the numbers for a seat.

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Speaker 3: Thanks.

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Speaker 2: Yeah, we appreciate It'd be very interesting, actually, given the

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Speaker 2: events of the world at the moment, the state of

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Speaker 2: our economy, to go in a year's time and look

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Speaker 2: back at the kind of sales data from this year

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Speaker 2: and see what impact the elections actually had. Ian McKnight

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Speaker 2: there from Opie's partner is our personal finance expert.

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Speaker 1: For more from Saturday Morning with Jack Tame, listen live

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