October 5, 2024 • 41 mins
Recently released Census data shows home ownership has increased nationwide, but Auckland is the exception.
CoreLogic Chief Property Economist Kelvin Davidson joins Tim Beveridge on The Weekend Collective to discuss why.
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Speaker 1 (00:05):
You're listening to the Weekend Collective podcast from news Talk
s B.
Speaker 2 (00:46):
That's it's welcome to the Weekend Collective. I let that
music roll on a bit because hey, it's Billy Joel.
Who doesn't love a bit of Billy Joel. I still
love that Billy Joel did all those concerts. What was
it that you do once a month? It was like
he had a residency at I can't think of the venue.
It was some huge venue. It's sell out all the time.
It's just Billy with a po w is banned. Amazing.
Speaker 3 (01:07):
Anyway, welcome back to the show. If you've missed any
of our panel, you can go and check it out
wherever you get your podcast for the Weekend Collective, iHeartRadio
probably be the place to go. I would suggest now
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(01:30):
You can also, if you're not in a hurry, email
Tim be at Newstalk said bea dot curtit in Z
and when I say lot not in a hurry that
should give you a clue as to the order of
preference eight hundred eighty ten eighty and joining me today
for the one roof radio show. He is chief Property
economist at core Logic and his name is Calvin Davidson.
Good afternoon, excellent. Now let's just quickly touch on can
(01:55):
we do predictions. We've got the upcoming OCR announcement. You
guys probably don't like predictions very much because you're in
the in the world of analyzing data. But actually, are
there particular statistical bits of information that you might have
gleaned from your work at core Logic as an economist
that give a bit of a signal as to whether
(02:17):
we can expect any change.
Speaker 4 (02:19):
Yeah, I mean it's not our it's not a central
part of our job to be forecasters. But I don't
think you can really do it without having a view
about the future. Because now we naturally present about what's
just happened, and then the natural thing as well what's
going to happen, So you kind of have to take
a view.
Speaker 5 (02:33):
I think, I mean.
Speaker 4 (02:35):
That there's definitely going to be an OCR cut on Wednesday.
That's just a question of how much I can see
the arguments both ways, But there's definitely going to be
a cut, and the question is how much.
Speaker 3 (02:45):
How do we know there's definitely going to be a cut?
Is that because he said there's going to be a cup?
Speaker 5 (02:49):
Well, I mean the economic data is just going that way.
Speaker 4 (02:52):
We know the economy itself, things like well the headline
GDP number, but if you look at jobs market, if
you look at manufacturing activity, house sales, all of these
things are really weak. So economic activity is is very soft.
And the Reserve banks focus seems I've shipped onto that
they've got a really really sharp focus now on the
real economy. Still obviously a huge on inflation, but we
(03:16):
know that's down and so yeah, the economy is weak
and they're reacting to that.
Speaker 3 (03:21):
Yeah, so what are the I mean, the options are
either point twenty five or point five of a point,
aren't they? There's nothing there's nothing else realistically on the table.
What do you reckon?
Speaker 4 (03:31):
Yep, that's those are the two options. I mean, well,
it would be an absolute huge surprise if they win
something different to the say a point seven five. I mean,
that's that's emergency sort of territory. They're not going to
be doing that I can see the arguments for both
point two five fur point five. Is their projection from
last time was, I guess, a recently steady path of
(03:52):
zero point two five percent cuts. Nothing really in the
data itself has changed since then, so you can definitely
argue for a point twenty five. However, I'm leaning more
towards a point five because I just think they're the
way they.
Speaker 5 (04:06):
Interpret the data seems to have changed.
Speaker 4 (04:08):
So the data itself isn't changed, but it's it's the
waiting that they're putting on those really weak economic signals,
and so we know inflation is coming down, so I
think they'll react to that, that weak economic data with
a with a point five percent cut. I think there's
a there's a sense now that the bigger risk is
not that inflation stays above target, it's actually that it
goes below target. You know, it falls faster than anybody
(04:30):
is anticipating, so they probably want to get ahead of
the curve in some ways, you know, get the ocr
back to a sort of so called neutral level a
bit faster. So yeah, argues for a point five percent cut,
and certainly there seems to be what the markets are anticipating,
and what the bank economists are anticipating. So I don't
know there's a sense of, well the Reserve bankmar as
well just do it, because that's what everyone's thinking anyway.
Speaker 3 (04:51):
All Actually, actually that excuse me. I've been quite pleased
with myself because I know economists hate giving predictions, but
I think we could probably say we actually have dragged
one out of you then, Calvin, haven't we.
Speaker 4 (05:02):
Well, like I said, you're going to have a view.
It's definitely going to be a cut.
Speaker 5 (05:05):
It's just that scale.
Speaker 4 (05:05):
And I'm leanding more towards point five.
Speaker 3 (05:08):
Actually, what do we know from because some of the
discussions around the ocr and people holding off, But of
course the banks will have The banks in a way
will have expressed their own view prior to this, simply
by the way they're pricing their mortgage rates right now.
Is there a story to be told in what you
guys observe.
Speaker 4 (05:29):
Yeah, I mean we've seen obviously some sharp cuts and
mortgage rates going back sort of six or eight weeks. Really,
mortgage rates been falling for quite some time, and I
suppose that is it's a really good point for people
out there, as you know, you could have further cuts
in the OCR without mortgage rates necessarily reacting as much
or as quickly as they have previously. Because yes, the
(05:50):
banks react, they sort of price it what they think
is going to happen in the future. They price that
into current mortgage rates. So you know, I think we're
certainly not at the bottom for mortgage rates by any means.
I think they will fall further, but it's just that
the speed of that decline might not be quite as
big as what we've seen it in the past couple
of months. So yep, some of that future is already
priced into mortgage rates. But yeah, if we see a
(06:11):
point five percent cut on the OCR, you would think
that mortgage rates will fall further, certainly those floating rates
and potentially some of those fixed terms. Now, the OCR
isn't the only driver of fixed rates. You've got what's
happening off shore. You've got sort of competitive behavior amongst
the banks, lots of factors, and obviously the banks made
their own pricing decisions, but certainly the outlook is for
the OCR to fall further and probably mortgage rates to
(06:33):
fall further as well, So look out for that on Wednesday.
Speaker 3 (06:37):
Yeah, good stuff. Actually, the other interesting that well, will
you often like to talk about a little bit of
data with you guys, given that to your core business
at core Logic. Now, I was curious to know firstly
whether the census story. So the story is with census
home ownership figures, there's a stat that's surprised officials in
(06:59):
that ownership generally has gone up for the first time
since the Night nineteen nineties, but that ownership in Auckland
is down. I guess if you're going to pick any
center in New Zealand for if ownership was to go down,
it probably would be Auckland, wouldn't it, simply just because
of the size of it. But I guess my quick
question is does the sense that do the census figures
(07:22):
match what your own expectations would be given that you
were analyzing data. I mean, Census is once every what
is it five years or something? You guys are analyzing
data literally hourly or daily, aren't you.
Speaker 6 (07:33):
Yeah?
Speaker 4 (07:34):
I must say there was a headline from Stats to
New Zealand and they were saying they were surprised by
the rise and the home ownership rate. I was surprised
that they're surprised because actually the fact that the home
ownership rate went up. I mean, you've got to acknowledge
in a wider context that it only went up a
little bit. We're still only at sixty six percent. It
has peaked some points in the past that somewhere close
(07:55):
to seventy five, So we're still below points we've been
in the past. But what we've seen over the past
couple of years at least is the first over buyers
have been a big share of the market. So yeah,
the fact we've seen that, and the fact that investors
have been a bit less active than normal, you would
you would naturally expect that the home ownership rate will
have gone up because people have been shifting into own occupation,
(08:15):
out of that rental sector into own occupation. So yeah,
I wasn't I wasn't too surprised, And yeah, I think
overall it's a it's a great thing. We all like
to see first home buyers get into the market and
see that home ownership rate go up. You have to
acknowledge there's always going to be people renting. We need
we need landlords too, we need investors to provide those
rental properties. But good that first home buyer has been
(08:36):
active and we're seeing that home ownership rate go up.
Speaker 3 (08:38):
Actually, now that you mentioned that, clearly the people at
Stats in New Zealand haven't been listening to the one
roof radio show because we've been banging on about first
home buyers being back in the market for a while,
so better send them a memo, haven't we.
Speaker 4 (08:51):
Yeah, that's why I say I was a little bit
surprised at their surprised because yeah, we've certainly if people
have been reading call Logic research, they will have seen
that first home buyers have been active for a while. Now,
As you said, the census has only done every five years.
You know, you think about that five year period from
twenty eighteen to twenty twenty three. I mean that's a
crazy period of time and first home buyers weren't active
(09:13):
for all of that period by any means, but certainly
in the past couple of years they've they've been pretty strong.
So so yeah, good to see, like I say, rising
home ownership rate. That's this positive thing.
Speaker 3 (09:23):
Yeah, what are there particular factors that are present that
are going to continue to drive that sort of that
rise in first home buyers getting in there or is
it predicated more in a lack of demand because maybe
the investors still aren't really back in the market.
Speaker 4 (09:42):
Yeah, I think we'll probably see the home ownership rate
continue to trend higher. And I mean there's a few
things around that. I mean, lending rules are in place,
and at the margins, things like DTIs might hinder investors
just a little bit more than first home buyers. So
that's that's probably something arguing for more owner occupiers to
get into the market. But just in general, things like
(10:03):
more housing suppl huge range of announcements last week from
the government on even more measures to try and remp
up the number of new houses in the market. Just
simply a wider range of stock, the right types of stock,
different types of houses, not all just standalone dwellings that
we might have built previously, more townhouses, more smaller houses,
(10:24):
so that range of stock, hopefully in the right places
where people want to live. I think, just we'll put
a bit of a cap on house prices, sort of
restrains affordability or improves affordability, and so should just plan
to own occupy his hands. So yeah, I think, well
this is a we're only going to know every five
years as the census comes out. But I'd be reasonably
optimistic that the home ownership rate will continue to rise.
(10:46):
Like I said, you always need some investors, You always
need there's always going to people be people who want
to rent. But if we see that home ownership rate
continue to rise and that's going to be a good thing.
Speaker 3 (10:56):
Is that something only the Census really keeps a track
on because you would have I guess you guys would
know when a first home buyers are buying, wouldn't you.
That would be something that you can track. But in
terms of the overall ownership rates, what data can you
collect in that regard.
Speaker 5 (11:11):
Yeah, we have some insights into that.
Speaker 4 (11:14):
We don't pretend that it's full proof by any means,
because it can be hard to track ownership through the
system in terms of quantifying how many properties people actually have.
You get into trust situations and this sort of thing,
so you know, it's not straightforward. Certainly, we track buying
activity and that's very easy, and we do have some
indications within our data of what the ownership rate is
(11:35):
versus the rental rate, but we certainly wouldn't pretend it's
full proof, so that the Census FORNIWA is probably still
the best benchmark. Unfortunately, though only every five years, so
we try and provide partial indicators, but it's only a
partial thing at best.
Speaker 3 (11:50):
What would you put it down to in terms of
the causes of people for instance? Okay, so the nutshell
being ownership in Auckland is down, which is consistent with
what's been happening for since the nineteen nineties. I think
if I read the headline correctly, but it's up elsewhere
is how much of that do you think would be?
Because well, of course we see headlines at christ Church
(12:10):
is the place to be and lots of stories about
people deciding to get out of Auckland. It doesn't really
feel like people are abound in New Auckland necessarily, but
certainly there is a movement of people want to start
their lives that they're looking at other centers. Is that
a genuinely impactful statistic or just a sort of idea
that we get when we're talking about property, like, oh,
apparently such and such as moved out to moved and
(12:32):
bought something in Towering.
Speaker 4 (12:34):
Yeah. I think we get asked this from time to times,
and it's different points in the cycle. People are very
interested in that kind of migration. The big centers out
into kind of provincial towns and cities, if you want
to call it that, and certainly after COVID, that whole
push to get more space, you know, get the lifestyle
dream or whatever it was.
Speaker 5 (12:51):
And you look.
Speaker 4 (12:52):
At the stats and it's definitely not clear cut. There's
always people going both ways, regardless of the point in
the cycle. There's always people moving out to regions, there's
always people moving back into the big cities.
Speaker 5 (13:02):
And so I think.
Speaker 4 (13:04):
Probably in the context you'd have to point to stretched
affordability as being a reason why home ownership rates would
be lower. You know, it's simply costs more to get
a house an Auckland relative to the Auckland income, so
that's going to restrain home ownership a little bit.
Speaker 5 (13:19):
But it's not just an Auckland thing either.
Speaker 4 (13:20):
If you look at like Hamilton City had a recentably
low ownership rate Wellington City.
Speaker 5 (13:24):
So I'd probably make it more general.
Speaker 4 (13:27):
It's about sort of the metropolitan centers versus provincial markets.
And you know, you tend to have the populations tend
to be younger and the big centers, so people move
to the big city start their career, they probably don't
want to be owning a house. They want to have
that flexibility and stay renting because they might not be
there forever. So there's a bunch of demographic factors. Certainly
affordability would be part of it, and potentially different different
(13:50):
ranges of properties, what's available, where it's available, But certainly
the stage of life that people are at, and just
general affordability i'd say, would be two really key drivers.
Speaker 3 (14:00):
Because rent is up, that's one of the negative well,
depending if you're wanting to earn rent as a land,
but if you're a rental that's not great. So rents
up is that for that very reason you've outlined that
people are people are moving to the big centers and
they're choosing not to buy because one they can't really
afford it, and too they want a bit of flexibility,
and they're young people and so there's a bit more
demand on the rental side of things.
Speaker 5 (14:19):
Yeah.
Speaker 4 (14:20):
Yeah, And I mean we've seen in the past couple
of years certainly rents have risen a lot. I can't
quite recall over that four five year period, but soon
over the last year or two, rents have risen a lot.
And that's that's to do a lot with migration we've
seen that big migration boom, a lot of that actually
went into Auckland, so you see pressure going on the
rental stock. The supply of rental properties was reasonably tight
(14:40):
there for a while because of course investors haven't been
purchasing as much as normal, So you've got a supply
and demand influence going.
Speaker 5 (14:47):
On there, and we saw rents go up a lot.
Speaker 4 (14:49):
On our figures, rents right now are the highest in
relation to incomes that they've been for at least twenty years.
So rents aren't just high in dollar terms, they're also
high in relation to people's incomes.
Speaker 5 (15:01):
So yeah, it's not easy being intended.
Speaker 4 (15:03):
Not easy paying mortgage right now either if you're servicing
a big mortgage, but also not easy paying rents either.
So a lot to do with simply that that economics cliche,
supply and demand saw a lot of migration. Demand for
rentals was high. However it is tailing off now. Migration's
tailing off, and we have seen rents actually flattened out.
So yeah, it could be that we're moving slightly into
a more kind of favorable market for tenants.
Speaker 3 (15:25):
I don't know, Actually, you might not have all this
stuff in front of you. What are the migration stats?
Where are we at with the number of people, because
it was we were gaining about one hundred one hundred
thousand people a year, and that was made up by
more than that number of immigrants because there are so many,
so many New Zealanders leaving.
Speaker 5 (15:43):
That's right.
Speaker 4 (15:43):
Yeah, So the rolling twelve month total for net migration
peaked out at about one hundred and thirty thousand, one
hundred and thirty five thousand.
Speaker 5 (15:52):
Something like that.
Speaker 4 (15:53):
It's now fallen down to about sixty five seventy so
in the last kind of year or so, it's halved
so really sharply. And as you've touched on, still a
lot of people leaving, we've got record outflows. It was
just at that peak it was masked by all their arrivals,
you know, just so many people coming in that it
masked the departures. But now we've still got record outflows
of people, and those rivals have slowed down too, so
(16:16):
the net balance is falling very sharply. Now it's still
high and you can still look and say sixty five
thousand and two, that's that's pretty much double the average,
but it's just falling so quickly that you do, only
give it a few more months and it might be
back down on average. So yeah, a lot less heat
in terms of property demand coming from that migration. So
we're seeing rentals flatten out and actually a lot more
(16:37):
rental properties available too. There's been a lot coming into
that kind of rental stock, partly from new builds still
the market, or from townhouses for example. So yeah, that
supply demand balance is definitely shifting around.
Speaker 3 (16:49):
So with the number of well, as I said, nationally,
the number of home buyers home ownerships increasing, and we
know the first time buyers are right in there, how
does this just tying it back to that first thing
we talked about the I don't know when to go
by history, I guess see what's happened. But when it
comes to a drop in the ocr if it does
happen to zero point five percent, that's a I mean
(17:11):
that also can have an effect on prices because maybe
there are suddenly more people are going, right, I can
finally get that loan I want and it's trying to
catch that. Does that mean what does it mean for
the first time buyers versus investors getting back in the market.
Do you think and are there any observations in the
past that tell us, give us, give us some sort
of leading on that.
Speaker 4 (17:31):
Yeah, I mean, you see, and in general, lower interest
rates will tend to translate into a bit more active
demand in the property market and higher house prices. That's
that's absolutely the track record, and I think we've seen
that reinforced since COVID. Look what happened straight after COVID.
Their interest rates collapsed and house price is spiped up
sort of forty percent, and our interest rates have resid
(17:51):
and house prices are fallen. So there's a very strong
kind and various correlation there. So I'd expect that, you know,
as we see mortgage rates.
Speaker 5 (17:58):
Fall, it'll add.
Speaker 4 (17:59):
Demand from all sources. You know, it's going to help
first time buyers paying less on the mortgage, but it's
also going to help investors too, So I think it's
I'd probably tend to look more general. Interest rates are
part of the story, but right now there's also things
like debt to income ratio caps that are just out
there on the horizon, and you slower mortgage rates you
would think would perhaps tend to boost house prices ordinarily
(18:21):
would get into twenty twenty five and lower mortgage rates,
we're pushing up the house prices. So on one hand,
you say a bit of money through lower interest rates,
but you pay more through the house price being higher.
This time around, though, as mortgage rates for we're going
to see those caps on debt to income ratios start
to bind. They'll not doing anything now, but as interest
rates for the amount of money that people can get
(18:42):
in relation to their income might start to be just
limited a little bit by those official rules. And so yeah,
I think there's reason to be relatively cautious about the
speed of any or the size of any reaction from
house prices to lower interest rates.
Speaker 3 (18:57):
What's the rationale for the depth your income rules? Is
there a particular wrong that they are trying to right?
Speaker 4 (19:03):
Well, it's about finding stability. So there's an arm and
for the Reserve Bank that is charged with the official
cash rate and so called monetary policy. And there's another
arm of the bank which is underworth doing financial stability.
So that's where things like the loan to value ratio
rules come in. It's where these debt to income ratio
rules come in. So the idea is that you don't
(19:23):
want big cycles and house prices because it destabilizes the
destabilizes the financial system. So the debt to income ratio
rules are there. They're not doing anything right now because
mortgage rates are capping the size of loans, but as
interest rates for the idea of DTIs is to just
sort of rain things in a bit, you know, And
(19:44):
the idea is actually to protect borrowers. So the LVR
rules are there to protect the banks because people have
to have a deposit, they have to have skin in
the game. The dtiyes are thoroughly about protecting the borrowers.
So it's saying, Okay, you might think you can afford
it right now, but what if interest rates, what if
they rise back, what if they spike unexpectedly. We're going
to try and just limit how much debt you can
(20:04):
have to to sort.
Speaker 5 (20:05):
Of limit that risk.
Speaker 4 (20:06):
So it's not really targeting house prices directly. It's about
financial stability, but house prices are.
Speaker 3 (20:12):
Part of that too, secondary effect. I guess, hey, look,
we're going to take a bick break. We'd love to
have your calls in texts I went UNDERD eighty ten
eighty or text nine two nine two. I guess it's
your reaction to the well the idea that the OCI
might be dropping a bit more and what that's going
to do for home ownership rates and your participation in
the market. But we're also going to touch on and
Calvin mentioned this before, some of the some of the
(20:35):
steps that the government are taking, and we're really going
to have a chat about that after the break as well,
because they have made an announcement on something that they
criticized labor for in some respects about underwriting developers. So
Chris Bishop is determined to get houses and dwellings built
in New Zealand and he wants to keep a lit
on property prices, which is possibly a surprise for people
(20:58):
that he's so strong on that, but he really wants
to drive supply. And one of the things the government
are going to do is they're looking at underwriting developed
is to give a bit more confidence that we can
get development started. And do you agree with that for
it for one, we'll have a chat about that with
Calvin Davidson straight after this. He's from Call Logic, I'm
from News Talks. He'd b that is twenty eight past four.
Speaker 6 (21:34):
Honey bugs, maybe you under you take no awarenough.
Speaker 3 (21:50):
Welcome back to the Weekend Collective us. Just having a
conversation with my producer. He said, this is this is
Olton john a kick from Chicken Little like it's from
a movie. It's like think Us from Think Us from
the seventies eight or maybe the eighties. Anyway, Calvin Davidson
can call too young to remember this sort of stuff.
Speaker 4 (22:06):
They wouldn't you, Calvin, Oh, no, no, no, I I'm
a big Elton joint bully Joel fans.
Speaker 5 (22:11):
Yeah.
Speaker 3 (22:12):
Did you see those guys when they both came when
they both came to Auckland quite some time ago, two
of them in concert?
Speaker 4 (22:20):
No I didn't no, no, no, no. Bruce Frankstein fan
to add him to the list.
Speaker 3 (22:24):
Oh there we go. Oh, we've got the playlist sort
of for next time. Calvin's on, Hey, look, I want
to have a chat about this. This is quite a
big deal this announcement. The government has made an announcement
and we were actually it's quite an opinion based announcement.
So if you want to give us your your reckons
on eighty ten eighty So the government is going to
underwrite some property developers, some property developers to ensure that
(22:49):
new housing is brought forward and it's because I gather,
I think Calvin, it's about the fact that there's a
lot of uncertainty and financing these things high interest rates,
and basically a lot of developers are just going this
is really really hard right now. There's too much uncertainty.
Judith Collins a few years ago, as housing spokesperson, called
(23:12):
it was a key we build underwrite, I think a
financial black hole. Is there a difference between I mean,
I don't know how much time you've had to look
into the detail of this, Calvin, But what is your
gut reaction to this, separate to a political reaction?
Speaker 4 (23:24):
Maybe yeah, So this is all about the issue for
a lot of developers at the moment is you need
to get pre sales or a sufficient number of pre
sales or percentage of a units have to be pre
sold so you've got some cash in so you can
keep the project off and sort of satisfy the bank
and keep things rolling. It's about sort of cash flow
and liquidity. Now just recently those pre sales have been
(23:46):
quite hard to get. So this scheme is about I
suppose the government's stepping in and I don't think necessarily
buying the units, but probably the funding effectively becoming the
pre sales without actually owning the units. So the liquidity
goes in and the cash goes in, and you know,
the developer can press ahead. Now it is only it's
big to be is the projects have to be at
(24:06):
least thirty units. They have to have an established trait record.
There's a whole bunch of criteria attached, so you know
it's probably not just going to be you know, your
local builder sort of putting up two units. That's going
to access this sort of established people who can prove
their credentials approve all of that. So yeah, it's it's
it seems to be a pretty good idea. You know,
(24:27):
there's no point sort of wasting these projects just for
a lack of finance. You can get that finance because
we know housing demand will come back. We're going in
there more new builds in future, so we can step
in and kind of fill that Void's it seems to
be a pretty good idea to me.
Speaker 5 (24:42):
Part of a huge suite of meshus.
Speaker 4 (24:44):
The government's doing it, as you said, Chris Busher, really
pushing art on this. Another thing that announced last week
was was streamlining the consending process. So perhaps reducing the
number of authorities that approve building consents.
Speaker 5 (24:57):
Maye that process smoother and streamlined. So so yeah, it
all adds up to that.
Speaker 4 (25:02):
It's all part of this wider push to an and
more housing supply.
Speaker 3 (25:06):
Well do you think those are the two of the
Do you think that this and the streamlining of the
consenting progress process? Do you think those are the two
big things? Or there's some other bigger part that you said,
it's a suite of actions the government's taking. Are there
some other things that have stood out to you as
a as an economist that will make a big difference
to the property market.
Speaker 4 (25:26):
Yeah, there's a ranger. So those a couple of things
that have just been announced recently. You've got the consent
for granny flats which was announced a while ago.
Speaker 3 (25:35):
Sixty that's bloody massive too, by the way, isn't it.
Speaker 4 (25:38):
Yes, Yeah, yeah, yeah, there's a decent sized, decent sized
granny flat for sure, cheaper, important, more allowing important materials
and substitution materials to come in and compete with with
local materials, get importing them in without necessarily having to
meet the same sort of quality standards if they've been
improved overseas they should be fine here. So there's that
as well. But I think for me, probably the biggest
(26:00):
one is more around the land supply stuff, So forcing
councils to plan for thirty years of growth, really putting
pressure on to enable more land to be made to
be made available, because I think that is probably the
big sort of restraint on things, as having enough land
in the right places with the right infrastructure to get
(26:21):
these projects off the ground. So all these things will help,
but probably that that for me, is the biggest one.
It's about forcing councils to zone this land, make sure
the land's available so we can get these houses, and
all these other things will help, but that that supplies
a biggie.
Speaker 7 (26:36):
It's quite a.
Speaker 3 (26:37):
Sort of I might get my terminology wrong here, but
I remember when Chris, when I first heard Chris Bishop
talking really passionately about he wants to keep I'm not
even seeing that it's sortially be said he wants to
drive to house prices down, but he wants to make
housing more affordable. That's probably the mantra, but it is
he's really driving a strong sort of it's almost I
(26:58):
wouldn't say socialist policy, or is it, you know what
I mean, it's what's your take on it. Is it
a surprising policy for someone from maybe center right government,
or or is it just great news that he's trying
to encourage as many key weis to own houses.
Speaker 4 (27:15):
Yeah. I wouldn't wade into the politics necessarily. And I
think what we've said correctly is that the governments of
both sides of the equation were you know, national or labor,
haven't always been that successful in housing supply. So I
think probably we're just in a situation now where you know,
you put aside the politics and you just have to say, great,
they're pushing really hard.
Speaker 5 (27:34):
Let's hope it works.
Speaker 4 (27:36):
Let's get more housing supply, and let's get more people
into the market, different types of houses, different locations, the
right infrastructure, all that. So you know, I'm fully in
behind it. Putting aside the politics. I think it's just
a good idea to try and push really hard on
these things. So let's hope it works, I guess is
the main conclusion for me.
Speaker 7 (27:55):
Yeah.
Speaker 3 (27:55):
The other thing is I was wondering if there's an argument,
and look at some of my arguments are half baked
because I'm not an economist, but you know how we
have this and this is probably slightly outside your remit,
but I'm sure you've got a passing interest in it.
But a lot of the argument around CGTS and all
the sort of thing is about, and a lot of
(28:17):
some of the argument it's about that we have this
obsession with property, and we have the secession as investors
with buying a property, you know, getting some rental, sitting
on it for a number of years, and then selling
it for a big profit, because we've been told to
basically plan for your own retirement. And it seems that
what Bishop is doing is almost in a way, it's
(28:38):
a more organic way of addressing that, because people, it's
encouraging investment into new housing, which might mean that it
might make housing, but does it make housing slightly just
the standard investment model of buying a house, you know,
sitting on it for a while, does it make it
a little less sexy and therefore push money into other
areas of the economy that are more productive. I wish
(28:59):
I could have found a better way of saying that,
but do you.
Speaker 7 (29:01):
Know what I mean?
Speaker 5 (29:02):
Yeah, I mean it could possibly.
Speaker 4 (29:04):
There's been a lot of research done over the past
couple of years into what drives house prices, and I
think interest rates are obviously part of it, credit rules, affordability,
all of that. I suppose the three key things that
have really stood out is that it's about land supply,
it's about your tax system, and it's about mortgit rates.
So if you think about the future from here, well,
(29:24):
it does look like we're going to see more land
supply opened up, perhaps relative to what we've seen historically. Okay,
there's always debate about the tax rules. It does feel
like we're creeping slowly towards perhaps a tax system that's
a little bit less favorable for property. Now it might
not be capital gains, it could be a land tax
(29:44):
down the track, who knows, but it does feel like
we're moving that way. So tax system a bit less
favorable more land supply, the long term trend we've seen,
and interest rates can't continue. You can't go from twenty
you can't keep going lower and low and lower in
terms of interest rates. So those things that have driven
house prices historically are perhaps not going to be as
(30:05):
important as they have, not going to be as important
in the future as they have been in the past.
Then you add in the fact that house prices are
already high, you're adding things like the debt to income ratios.
I think you can build a reasonably solid case that
capital growth in future would be less than what I've
seen historically. Now it's we're probably going to still see
house prices go up because wages go up, that sort
(30:25):
of thing, but perhaps a bit less growth in future
than what I've seen historically.
Speaker 5 (30:29):
So we'll still have properly investors.
Speaker 4 (30:30):
There will still be money to be made, but perhaps
it might be a bit less than what I've seen
in the future, and does not so much argument around
home ownership.
Speaker 3 (30:39):
Not so much fly by night more than sort of
traditional investors who are in for the long term.
Speaker 5 (30:44):
Yeah.
Speaker 4 (30:44):
Well, and that's every property investor I speak to is
that's generally what they're there to do. It's, hey, I
just want to pay down my mortgage. I want to
by the time I retire, I want to have a
mortgage free asset and I can live off the rent,
or at least try to live off the rent. So
that is I think that most people I speak to
are those genuine kind of long term investors who want
to have a good time, don't provide a good property
(31:06):
and pay down that debt. Now, yes, some capital gain
has always helped, and that has been a big benefit
in the past. I think it will continue in future
as well, but perhaps not as strongly as it has done.
Speaker 3 (31:16):
Yeah, certainly, of course. Something that's the thing if you
do research just by reading property headlines, you'll get quite
a skewed version of the market because often the headlines
are the most dramatic stories, like somebody flips property on
for this, and that makes you think that that's the
game everyone's playing, isn't it anyway.
Speaker 4 (31:30):
Yeah, that's right, And there's a lot of stats around this.
It's very hard again to nail down precisely, but there
are stats around saying that most landlords are in perhaps
one property, it might be two tops, so the whole
they are genuine long term landlords. So we want to
provide a good service and they're just sort of trying
to pay off that debt to fund their retirement. That
model is what I hear a lot about. And yes,
(31:51):
there are people outside that group, and they are there
to kind of get some capital game, maybe flip some properties.
But if they are acknowledged by ourd as property traders,
while they'll be text on that anyway. So yeah, there's
sometimes the headlines can can skew the reality.
Speaker 3 (32:07):
Of course, exactly right. We're going to be back with more. Actually,
i'd like to you if you'd like to give us
a call. We'd love to hear from you on you know,
we've on your opinion on the government underwriting some developments
which were funnily enough described as a financial black hole
by five years ago by Nationals a spokesperson for Housing
Judith Collins. But now that they want to get supply going,
(32:27):
they want to give developers, some developers, the reliable ones
that they trust, I guess, some level of surety to
get things going. Do you support this and what the
effect do you think it's going to have on the market.
Will it deliver that sort of maybe more affordable housing
that Chris Bishop has been advocating he wants to see
for all New Zealanders And what does it mean for
the property market in general? Your reckons and opinions on
(32:49):
eight hundred eighty ten eighty it's eighteen minutes to five
news talks. He'd b.
Speaker 8 (32:56):
I get down, Yes, welcome back to the one roof
radio showing with the Chief Property economist at core Logic
for Calvin Davidson actually just probably go into it, Calvin,
(33:18):
just remind people what core Logic do.
Speaker 4 (33:22):
We're data and analytics company and the property markets so
provide a range of services to anybody who's in real estate,
whether that's agents obviously the banks are a big client,
mortgage brokers or aggregators, insurance, construction, the public sectors. But
we provide all the addressing to the emergency services, which
(33:43):
is a really really sort of positive thing within the business.
If you need an ambulance, you need the ambulance needs
to know where to go very quickly, obviously, so we
provide that addressing, make sure that's up to date and maintained.
So yeah, across a wide range of anything that's involved
with property, we're sort of you know, we're touching on.
Speaker 3 (34:02):
And of course, I mean obviously people certain industries will
pay for your advice, but you also do have newsletters
that go on go out about the property market as
well that people can get ahold of.
Speaker 5 (34:12):
Aren't there yep, yep.
Speaker 4 (34:14):
Call Logic dot co dot in z you'll find our research.
So I'm an economist, I mean I'm basically an end
user of all of that other information that goes to
our clients, and I'm there to sort of use that information,
tell some stories about the property market, hopefully give some
insight into what's going on. And we do a lot
of presentations as well. So I suppose the research side
of the business is about it's about education. A lot
(34:37):
of it's free, and it's about just just talking about
the market, sort of a public service in some ways.
Speaker 3 (34:43):
Just on that announcement of the government's under planning to
underwrite some property developments, and it's been I think National
has been criticized for being a bit hypocritical about it
because they criticized the key we build underwrite, But of
course that was the government building houses and underwriting and
doing the whole kitten kerboodle. Whereas I gather here, the
(35:03):
government is not going to be actually invest They're simply
underwriting and if something falls over, they'll own the houses
that haven't been delivered. But beyond that, it's like it's
more of an underwrite rather than we are the government
we're building the world.
Speaker 5 (35:18):
Yeah, I think that's that's right that it seems.
Speaker 4 (35:21):
I mean, it's early days yet, but the criteria criteria
around this new scheme seems to be a lot higher.
It's targeting projects that are already approved. It's just a
liquidity thing. It's with big developers with established track records,
and I guess at this point in the cycle, in
some ways reading between the lines, the government probably hopes
(35:41):
they don't have to put in anything at all because
eventually it will just fund the project, it will get
it quickly off the ground, the money will come back
and effectively they won't be putting in anything at all.
So I'd say it aimed at a sort of a
different funding model, perhaps not as not intended to be
as big, because keep in mind Key we Build was
the grand hundred thousand dollars hundred thousand properties target. Probably
(36:06):
you're just probably operating at a different stage of the
process and maybe with different criteria too.
Speaker 3 (36:13):
That also, I guess the question for the government and
where they'll be accountable is if they back a big
white elephant or something and find themselves with a bit
of a turd where we've got to pay a hold
of money for something that doesn't really have much value,
and that'll that does put a fair a little bit
of pressure on the officials to make sure that they
are working with what one tried and trusted developers on
(36:34):
projects that generally genuinely stack up.
Speaker 5 (36:38):
Yep, that's right, yeah, yeah.
Speaker 4 (36:39):
And if you read some of the documentation around this
new scheme, and it actually says that they're going to
be actively talking with the developers who they think might
be eligible in advance of an application. So they actually
only want sort of one hundred percent applications to come in.
They don't want to be rejecting applications because they want
to filter out the people who might not meet the
(37:00):
criteria before they ever get to that stage. So I
think they really are looking for the sort of cream
of the up, those people who have long track records
with a really financially viable project other than for whatever reason,
you just can't quite get funding or those pre sales.
And then so the white elephants, I suppose you're always
trying to minimize that risk. I guess it's always there,
but they'd hope read that out first.
Speaker 3 (37:22):
Excellent, Well, we're gonna come back in just a moment
with one roof. Property of the Week is next. It's
quite a doozy. You might need to win, and you know,
sort of second or third stage powerball to really afford
this one, but what the hell. I'll give you the description.
You can go and check it out yourself for yourselves,
because it is a beauty. It's ten minutes to five.
News talks'd b start?
Speaker 7 (37:44):
You can't start, guess.
Speaker 3 (37:58):
Welcome back to the Weekend Collective. This is one roof
radio show. Of course, a little bit of Bruce Springsteen,
just because we've eate that bit of an information out
of Calvin Davidson from Core Logic that he quite likes
a bit of the boss.
Speaker 7 (38:09):
It is.
Speaker 3 (38:10):
What's the time? It's coming up to six minutes to five.
Speaker 1 (38:13):
The one roof property of the week on the Weekend Collective.
Speaker 3 (38:18):
Now I sort of sold that I did tease. This
property has been quite spectacular. But it's an interesting one
because it is eight hundred and the address is eight
one five pour Aquino Valley Road, which is in obviously
pour Achino Valley at Southland. Now it is tricky because
there's no estimate of the price. The RV is seven mil,
(38:39):
seven million dollars. It's four bedroom, three bathroom, two car garage,
six hundred square metres, big house, two stories, and it
does look pretty grand. It's got to marble tide floors
in a chandelier, a quite an extravagant stair case. It's
a two story colonial homestead built built in twenty twelve.
But the interesting thing is when you see the photos,
(39:00):
it looks like there's a little bit of work to
be done on just the bit of it. Looks like
it's sitting on a fairly bear patch of land, and
so I reckon, if you're up for this sort of thing,
there could be what do I know, a little bit
of haggling involved. But what did you make of it, Calvin?
Because it does look like there's room to sew a
bit of grass, doesn't there?
Speaker 7 (39:16):
I put it that way.
Speaker 4 (39:17):
Yeah, yeah, I'm a big fan of nice green lawns,
so yeah, you could definitely make those improvements. But yeah,
great looking house and fair Midland too. Looks like some
native forest on there, so yeah, i'd say, incredible opportunity.
I know my wife's from Southland are down near Riverton
there the houses, so I know the area pretty well
and great spots, so yeah, someone would probably pick up
(39:41):
a bargain there.
Speaker 5 (39:41):
I'd say, you think do.
Speaker 3 (39:42):
You think that there'd be room for haggling, isn't it?
Because I was surprised that I just saw that there
was a bit of look like the grass has been
sort of taken out and they're about to resow some
and they just had to get those photos taken.
Speaker 5 (39:54):
Yeah.
Speaker 4 (39:54):
Possibly possibly. Yeah, It's like I say, great, a nice
lawn aroundy property. So yeah, a great opportunity there and
a huge looks like a huge amount of a native
bush around there. So someone I really enjoy that, I'd imagine.
Speaker 3 (40:07):
Yeah, good on you. Actually the rural outlook as well.
I mean people in New Zealand bang on about a
seaview and who doesn't love a good cview on a
mountain view. But there is something about some of the
rural aspects of New Zealand and is the rural outlook
there with the farmland and the bush behind it absolutely gorgeous.
So go and check that out. It is just need
(40:27):
to look on the one roof for radio one roof
site sorry one roof dot Curtain is eight one five
Perchino Valley Road. And as I say that, Calvin time
has raced by. We've covered covered a little bit. But
if people want to check out the work of call logic,
they just go to call Loge dot curtain, is it right?
Speaker 5 (40:42):
Yep, that's right, yep.
Speaker 4 (40:43):
And like I said, we're out there with rest and research.
It's it's all available on our website. We have a podcast.
We do a lot of media work, so people will
have seen our stuff, no doubt, in some shape or form.
And yeah, we're reporting every week on the market. So yeah,
hopefully good pulse.
Speaker 3 (40:58):
Good stuff. Okay, we'll be back with a parent squad
next this News Talks.
Speaker 5 (41:01):
There'd be.
Speaker 1 (41:05):
For more from the Weekend Collective. Listen live to News
Talk ZEDB weekends from three p m. Or follow the
podcast on iHeartRadio.
You're listening to the Weekend Collective podcast from news Talk
s B.
Speaker 2 (00:46):
That's it's welcome to the Weekend Collective. I let that
music roll on a bit because hey, it's Billy Joel.
Who doesn't love a bit of Billy Joel. I still
love that Billy Joel did all those concerts. What was
it that you do once a month? It was like
he had a residency at I can't think of the venue.
It was some huge venue. It's sell out all the time.
It's just Billy with a po w is banned. Amazing.
Speaker 3 (01:07):
Anyway, welcome back to the show. If you've missed any
of our panel, you can go and check it out
wherever you get your podcast for the Weekend Collective, iHeartRadio
probably be the place to go. I would suggest now
time for the one roof radio show, and we want
your participation. We'd love it your calls and opinions on
eight hundred eighty ten eighty. You can also text nine
two nine two. Don't forget the standard SEMs charges apply.
(01:30):
You can also, if you're not in a hurry, email
Tim be at Newstalk said bea dot curtit in Z
and when I say lot not in a hurry that
should give you a clue as to the order of
preference eight hundred eighty ten eighty and joining me today
for the one roof radio show. He is chief Property
economist at core Logic and his name is Calvin Davidson.
Good afternoon, excellent. Now let's just quickly touch on can
(01:55):
we do predictions. We've got the upcoming OCR announcement. You
guys probably don't like predictions very much because you're in
the in the world of analyzing data. But actually, are
there particular statistical bits of information that you might have
gleaned from your work at core Logic as an economist
that give a bit of a signal as to whether
(02:17):
we can expect any change.
Speaker 4 (02:19):
Yeah, I mean it's not our it's not a central
part of our job to be forecasters. But I don't
think you can really do it without having a view
about the future. Because now we naturally present about what's
just happened, and then the natural thing as well what's
going to happen, So you kind of have to take
a view.
Speaker 5 (02:33):
I think, I mean.
Speaker 4 (02:35):
That there's definitely going to be an OCR cut on Wednesday.
That's just a question of how much I can see
the arguments both ways, But there's definitely going to be
a cut, and the question is how much.
Speaker 3 (02:45):
How do we know there's definitely going to be a cut?
Is that because he said there's going to be a cup?
Speaker 5 (02:49):
Well, I mean the economic data is just going that way.
Speaker 4 (02:52):
We know the economy itself, things like well the headline
GDP number, but if you look at jobs market, if
you look at manufacturing activity, house sales, all of these
things are really weak. So economic activity is is very soft.
And the Reserve banks focus seems I've shipped onto that
they've got a really really sharp focus now on the
real economy. Still obviously a huge on inflation, but we
(03:16):
know that's down and so yeah, the economy is weak
and they're reacting to that.
Speaker 3 (03:21):
Yeah, so what are the I mean, the options are
either point twenty five or point five of a point,
aren't they? There's nothing there's nothing else realistically on the table.
What do you reckon?
Speaker 4 (03:31):
Yep, that's those are the two options. I mean, well,
it would be an absolute huge surprise if they win
something different to the say a point seven five. I mean,
that's that's emergency sort of territory. They're not going to
be doing that I can see the arguments for both
point two five fur point five. Is their projection from
last time was, I guess, a recently steady path of
(03:52):
zero point two five percent cuts. Nothing really in the
data itself has changed since then, so you can definitely
argue for a point twenty five. However, I'm leaning more
towards a point five because I just think they're the
way they.
Speaker 5 (04:06):
Interpret the data seems to have changed.
Speaker 4 (04:08):
So the data itself isn't changed, but it's it's the
waiting that they're putting on those really weak economic signals,
and so we know inflation is coming down, so I
think they'll react to that, that weak economic data with
a with a point five percent cut. I think there's
a there's a sense now that the bigger risk is
not that inflation stays above target, it's actually that it
goes below target. You know, it falls faster than anybody
(04:30):
is anticipating, so they probably want to get ahead of
the curve in some ways, you know, get the ocr
back to a sort of so called neutral level a
bit faster. So yeah, argues for a point five percent cut,
and certainly there seems to be what the markets are anticipating,
and what the bank economists are anticipating. So I don't
know there's a sense of, well the Reserve bankmar as
well just do it, because that's what everyone's thinking anyway.
Speaker 3 (04:51):
All Actually, actually that excuse me. I've been quite pleased
with myself because I know economists hate giving predictions, but
I think we could probably say we actually have dragged
one out of you then, Calvin, haven't we.
Speaker 4 (05:02):
Well, like I said, you're going to have a view.
It's definitely going to be a cut.
Speaker 5 (05:05):
It's just that scale.
Speaker 4 (05:05):
And I'm leanding more towards point five.
Speaker 3 (05:08):
Actually, what do we know from because some of the
discussions around the ocr and people holding off, But of
course the banks will have The banks in a way
will have expressed their own view prior to this, simply
by the way they're pricing their mortgage rates right now.
Is there a story to be told in what you
guys observe.
Speaker 4 (05:29):
Yeah, I mean we've seen obviously some sharp cuts and
mortgage rates going back sort of six or eight weeks. Really,
mortgage rates been falling for quite some time, and I
suppose that is it's a really good point for people
out there, as you know, you could have further cuts
in the OCR without mortgage rates necessarily reacting as much
or as quickly as they have previously. Because yes, the
(05:50):
banks react, they sort of price it what they think
is going to happen in the future. They price that
into current mortgage rates. So you know, I think we're
certainly not at the bottom for mortgage rates by any means.
I think they will fall further, but it's just that
the speed of that decline might not be quite as
big as what we've seen it in the past couple
of months. So yep, some of that future is already
priced into mortgage rates. But yeah, if we see a
(06:11):
point five percent cut on the OCR, you would think
that mortgage rates will fall further, certainly those floating rates
and potentially some of those fixed terms. Now, the OCR
isn't the only driver of fixed rates. You've got what's
happening off shore. You've got sort of competitive behavior amongst
the banks, lots of factors, and obviously the banks made
their own pricing decisions, but certainly the outlook is for
the OCR to fall further and probably mortgage rates to
(06:33):
fall further as well, So look out for that on Wednesday.
Speaker 3 (06:37):
Yeah, good stuff. Actually, the other interesting that well, will
you often like to talk about a little bit of
data with you guys, given that to your core business
at core Logic. Now, I was curious to know firstly
whether the census story. So the story is with census
home ownership figures, there's a stat that's surprised officials in
(06:59):
that ownership generally has gone up for the first time
since the Night nineteen nineties, but that ownership in Auckland
is down. I guess if you're going to pick any
center in New Zealand for if ownership was to go down,
it probably would be Auckland, wouldn't it, simply just because
of the size of it. But I guess my quick
question is does the sense that do the census figures
(07:22):
match what your own expectations would be given that you
were analyzing data. I mean, Census is once every what
is it five years or something? You guys are analyzing
data literally hourly or daily, aren't you.
Speaker 6 (07:33):
Yeah?
Speaker 4 (07:34):
I must say there was a headline from Stats to
New Zealand and they were saying they were surprised by
the rise and the home ownership rate. I was surprised
that they're surprised because actually the fact that the home
ownership rate went up. I mean, you've got to acknowledge
in a wider context that it only went up a
little bit. We're still only at sixty six percent. It
has peaked some points in the past that somewhere close
(07:55):
to seventy five, So we're still below points we've been
in the past. But what we've seen over the past
couple of years at least is the first over buyers
have been a big share of the market. So yeah,
the fact we've seen that, and the fact that investors
have been a bit less active than normal, you would
you would naturally expect that the home ownership rate will
have gone up because people have been shifting into own occupation,
(08:15):
out of that rental sector into own occupation. So yeah,
I wasn't I wasn't too surprised, And yeah, I think
overall it's a it's a great thing. We all like
to see first home buyers get into the market and
see that home ownership rate go up. You have to
acknowledge there's always going to be people renting. We need
we need landlords too, we need investors to provide those
rental properties. But good that first home buyer has been
(08:36):
active and we're seeing that home ownership rate go up.
Speaker 3 (08:38):
Actually, now that you mentioned that, clearly the people at
Stats in New Zealand haven't been listening to the one
roof radio show because we've been banging on about first
home buyers being back in the market for a while,
so better send them a memo, haven't we.
Speaker 4 (08:51):
Yeah, that's why I say I was a little bit
surprised at their surprised because yeah, we've certainly if people
have been reading call Logic research, they will have seen
that first home buyers have been active for a while. Now,
As you said, the census has only done every five years.
You know, you think about that five year period from
twenty eighteen to twenty twenty three. I mean that's a
crazy period of time and first home buyers weren't active
(09:13):
for all of that period by any means, but certainly
in the past couple of years they've they've been pretty strong.
So so yeah, good to see, like I say, rising
home ownership rate. That's this positive thing.
Speaker 3 (09:23):
Yeah, what are there particular factors that are present that
are going to continue to drive that sort of that
rise in first home buyers getting in there or is
it predicated more in a lack of demand because maybe
the investors still aren't really back in the market.
Speaker 4 (09:42):
Yeah, I think we'll probably see the home ownership rate
continue to trend higher. And I mean there's a few
things around that. I mean, lending rules are in place,
and at the margins, things like DTIs might hinder investors
just a little bit more than first home buyers. So
that's that's probably something arguing for more owner occupiers to
get into the market. But just in general, things like
(10:03):
more housing suppl huge range of announcements last week from
the government on even more measures to try and remp
up the number of new houses in the market. Just
simply a wider range of stock, the right types of stock,
different types of houses, not all just standalone dwellings that
we might have built previously, more townhouses, more smaller houses,
(10:24):
so that range of stock, hopefully in the right places
where people want to live. I think, just we'll put
a bit of a cap on house prices, sort of
restrains affordability or improves affordability, and so should just plan
to own occupy his hands. So yeah, I think, well
this is a we're only going to know every five
years as the census comes out. But I'd be reasonably
optimistic that the home ownership rate will continue to rise.
(10:46):
Like I said, you always need some investors, You always
need there's always going to people be people who want
to rent. But if we see that home ownership rate
continue to rise and that's going to be a good thing.
Speaker 3 (10:56):
Is that something only the Census really keeps a track
on because you would have I guess you guys would
know when a first home buyers are buying, wouldn't you.
That would be something that you can track. But in
terms of the overall ownership rates, what data can you
collect in that regard.
Speaker 5 (11:11):
Yeah, we have some insights into that.
Speaker 4 (11:14):
We don't pretend that it's full proof by any means,
because it can be hard to track ownership through the
system in terms of quantifying how many properties people actually have.
You get into trust situations and this sort of thing,
so you know, it's not straightforward. Certainly, we track buying
activity and that's very easy, and we do have some
indications within our data of what the ownership rate is
(11:35):
versus the rental rate, but we certainly wouldn't pretend it's
full proof, so that the Census FORNIWA is probably still
the best benchmark. Unfortunately, though only every five years, so
we try and provide partial indicators, but it's only a
partial thing at best.
Speaker 3 (11:50):
What would you put it down to in terms of
the causes of people for instance? Okay, so the nutshell
being ownership in Auckland is down, which is consistent with
what's been happening for since the nineteen nineties. I think
if I read the headline correctly, but it's up elsewhere
is how much of that do you think would be?
Because well, of course we see headlines at christ Church
(12:10):
is the place to be and lots of stories about
people deciding to get out of Auckland. It doesn't really
feel like people are abound in New Auckland necessarily, but
certainly there is a movement of people want to start
their lives that they're looking at other centers. Is that
a genuinely impactful statistic or just a sort of idea
that we get when we're talking about property, like, oh,
apparently such and such as moved out to moved and
(12:32):
bought something in Towering.
Speaker 4 (12:34):
Yeah. I think we get asked this from time to times,
and it's different points in the cycle. People are very
interested in that kind of migration. The big centers out
into kind of provincial towns and cities, if you want
to call it that, and certainly after COVID, that whole
push to get more space, you know, get the lifestyle
dream or whatever it was.
Speaker 5 (12:51):
And you look.
Speaker 4 (12:52):
At the stats and it's definitely not clear cut. There's
always people going both ways, regardless of the point in
the cycle. There's always people moving out to regions, there's
always people moving back into the big cities.
Speaker 5 (13:02):
And so I think.
Speaker 4 (13:04):
Probably in the context you'd have to point to stretched
affordability as being a reason why home ownership rates would
be lower. You know, it's simply costs more to get
a house an Auckland relative to the Auckland income, so
that's going to restrain home ownership a little bit.
Speaker 5 (13:19):
But it's not just an Auckland thing either.
Speaker 4 (13:20):
If you look at like Hamilton City had a recentably
low ownership rate Wellington City.
Speaker 5 (13:24):
So I'd probably make it more general.
Speaker 4 (13:27):
It's about sort of the metropolitan centers versus provincial markets.
And you know, you tend to have the populations tend
to be younger and the big centers, so people move
to the big city start their career, they probably don't
want to be owning a house. They want to have
that flexibility and stay renting because they might not be
there forever. So there's a bunch of demographic factors. Certainly
affordability would be part of it, and potentially different different
(13:50):
ranges of properties, what's available, where it's available, But certainly
the stage of life that people are at, and just
general affordability i'd say, would be two really key drivers.
Speaker 3 (14:00):
Because rent is up, that's one of the negative well,
depending if you're wanting to earn rent as a land,
but if you're a rental that's not great. So rents
up is that for that very reason you've outlined that
people are people are moving to the big centers and
they're choosing not to buy because one they can't really
afford it, and too they want a bit of flexibility,
and they're young people and so there's a bit more
demand on the rental side of things.
Speaker 5 (14:19):
Yeah.
Speaker 4 (14:20):
Yeah, And I mean we've seen in the past couple
of years certainly rents have risen a lot. I can't
quite recall over that four five year period, but soon
over the last year or two, rents have risen a lot.
And that's that's to do a lot with migration we've
seen that big migration boom, a lot of that actually
went into Auckland, so you see pressure going on the
rental stock. The supply of rental properties was reasonably tight
(14:40):
there for a while because of course investors haven't been
purchasing as much as normal, So you've got a supply
and demand influence going.
Speaker 5 (14:47):
On there, and we saw rents go up a lot.
Speaker 4 (14:49):
On our figures, rents right now are the highest in
relation to incomes that they've been for at least twenty years.
So rents aren't just high in dollar terms, they're also
high in relation to people's incomes.
Speaker 5 (15:01):
So yeah, it's not easy being intended.
Speaker 4 (15:03):
Not easy paying mortgage right now either if you're servicing
a big mortgage, but also not easy paying rents either.
So a lot to do with simply that that economics cliche,
supply and demand saw a lot of migration. Demand for
rentals was high. However it is tailing off now. Migration's
tailing off, and we have seen rents actually flattened out.
So yeah, it could be that we're moving slightly into
a more kind of favorable market for tenants.
Speaker 3 (15:25):
I don't know, Actually, you might not have all this
stuff in front of you. What are the migration stats?
Where are we at with the number of people, because
it was we were gaining about one hundred one hundred
thousand people a year, and that was made up by
more than that number of immigrants because there are so many,
so many New Zealanders leaving.
Speaker 5 (15:43):
That's right.
Speaker 4 (15:43):
Yeah, So the rolling twelve month total for net migration
peaked out at about one hundred and thirty thousand, one
hundred and thirty five thousand.
Speaker 5 (15:52):
Something like that.
Speaker 4 (15:53):
It's now fallen down to about sixty five seventy so
in the last kind of year or so, it's halved
so really sharply. And as you've touched on, still a
lot of people leaving, we've got record outflows. It was
just at that peak it was masked by all their arrivals,
you know, just so many people coming in that it
masked the departures. But now we've still got record outflows
of people, and those rivals have slowed down too, so
(16:16):
the net balance is falling very sharply. Now it's still
high and you can still look and say sixty five
thousand and two, that's that's pretty much double the average,
but it's just falling so quickly that you do, only
give it a few more months and it might be
back down on average. So yeah, a lot less heat
in terms of property demand coming from that migration. So
we're seeing rentals flatten out and actually a lot more
(16:37):
rental properties available too. There's been a lot coming into
that kind of rental stock, partly from new builds still
the market, or from townhouses for example. So yeah, that
supply demand balance is definitely shifting around.
Speaker 3 (16:49):
So with the number of well, as I said, nationally,
the number of home buyers home ownerships increasing, and we
know the first time buyers are right in there, how
does this just tying it back to that first thing
we talked about the I don't know when to go
by history, I guess see what's happened. But when it
comes to a drop in the ocr if it does
happen to zero point five percent, that's a I mean
(17:11):
that also can have an effect on prices because maybe
there are suddenly more people are going, right, I can
finally get that loan I want and it's trying to
catch that. Does that mean what does it mean for
the first time buyers versus investors getting back in the market.
Do you think and are there any observations in the
past that tell us, give us, give us some sort
of leading on that.
Speaker 4 (17:31):
Yeah, I mean, you see, and in general, lower interest
rates will tend to translate into a bit more active
demand in the property market and higher house prices. That's
that's absolutely the track record, and I think we've seen
that reinforced since COVID. Look what happened straight after COVID.
Their interest rates collapsed and house price is spiped up
sort of forty percent, and our interest rates have resid
(17:51):
and house prices are fallen. So there's a very strong
kind and various correlation there. So I'd expect that, you know,
as we see mortgage rates.
Speaker 5 (17:58):
Fall, it'll add.
Speaker 4 (17:59):
Demand from all sources. You know, it's going to help
first time buyers paying less on the mortgage, but it's
also going to help investors too, So I think it's
I'd probably tend to look more general. Interest rates are
part of the story, but right now there's also things
like debt to income ratio caps that are just out
there on the horizon, and you slower mortgage rates you
would think would perhaps tend to boost house prices ordinarily
(18:21):
would get into twenty twenty five and lower mortgage rates,
we're pushing up the house prices. So on one hand,
you say a bit of money through lower interest rates,
but you pay more through the house price being higher.
This time around, though, as mortgage rates for we're going
to see those caps on debt to income ratios start
to bind. They'll not doing anything now, but as interest
rates for the amount of money that people can get
(18:42):
in relation to their income might start to be just
limited a little bit by those official rules. And so yeah,
I think there's reason to be relatively cautious about the
speed of any or the size of any reaction from
house prices to lower interest rates.
Speaker 3 (18:57):
What's the rationale for the depth your income rules? Is
there a particular wrong that they are trying to right?
Speaker 4 (19:03):
Well, it's about finding stability. So there's an arm and
for the Reserve Bank that is charged with the official
cash rate and so called monetary policy. And there's another
arm of the bank which is underworth doing financial stability.
So that's where things like the loan to value ratio
rules come in. It's where these debt to income ratio
rules come in. So the idea is that you don't
(19:23):
want big cycles and house prices because it destabilizes the
destabilizes the financial system. So the debt to income ratio
rules are there. They're not doing anything right now because
mortgage rates are capping the size of loans, but as
interest rates for the idea of DTIs is to just
sort of rain things in a bit, you know, And
(19:44):
the idea is actually to protect borrowers. So the LVR
rules are there to protect the banks because people have
to have a deposit, they have to have skin in
the game. The dtiyes are thoroughly about protecting the borrowers.
So it's saying, Okay, you might think you can afford
it right now, but what if interest rates, what if
they rise back, what if they spike unexpectedly. We're going
to try and just limit how much debt you can
(20:04):
have to to sort.
Speaker 5 (20:05):
Of limit that risk.
Speaker 4 (20:06):
So it's not really targeting house prices directly. It's about
financial stability, but house prices are.
Speaker 3 (20:12):
Part of that too, secondary effect. I guess, hey, look,
we're going to take a bick break. We'd love to
have your calls in texts I went UNDERD eighty ten
eighty or text nine two nine two. I guess it's
your reaction to the well the idea that the OCI
might be dropping a bit more and what that's going
to do for home ownership rates and your participation in
the market. But we're also going to touch on and
Calvin mentioned this before, some of the some of the
(20:35):
steps that the government are taking, and we're really going
to have a chat about that after the break as well,
because they have made an announcement on something that they
criticized labor for in some respects about underwriting developers. So
Chris Bishop is determined to get houses and dwellings built
in New Zealand and he wants to keep a lit
on property prices, which is possibly a surprise for people
(20:58):
that he's so strong on that, but he really wants
to drive supply. And one of the things the government
are going to do is they're looking at underwriting developed
is to give a bit more confidence that we can
get development started. And do you agree with that for
it for one, we'll have a chat about that with
Calvin Davidson straight after this. He's from Call Logic, I'm
from News Talks. He'd b that is twenty eight past four.
Speaker 6 (21:34):
Honey bugs, maybe you under you take no awarenough.
Speaker 3 (21:50):
Welcome back to the Weekend Collective us. Just having a
conversation with my producer. He said, this is this is
Olton john a kick from Chicken Little like it's from
a movie. It's like think Us from Think Us from
the seventies eight or maybe the eighties. Anyway, Calvin Davidson
can call too young to remember this sort of stuff.
Speaker 4 (22:06):
They wouldn't you, Calvin, Oh, no, no, no, I I'm
a big Elton joint bully Joel fans.
Speaker 5 (22:11):
Yeah.
Speaker 3 (22:12):
Did you see those guys when they both came when
they both came to Auckland quite some time ago, two
of them in concert?
Speaker 4 (22:20):
No I didn't no, no, no, no. Bruce Frankstein fan
to add him to the list.
Speaker 3 (22:24):
Oh there we go. Oh, we've got the playlist sort
of for next time. Calvin's on, Hey, look, I want
to have a chat about this. This is quite a
big deal this announcement. The government has made an announcement
and we were actually it's quite an opinion based announcement.
So if you want to give us your your reckons
on eighty ten eighty So the government is going to
underwrite some property developers, some property developers to ensure that
(22:49):
new housing is brought forward and it's because I gather,
I think Calvin, it's about the fact that there's a
lot of uncertainty and financing these things high interest rates,
and basically a lot of developers are just going this
is really really hard right now. There's too much uncertainty.
Judith Collins a few years ago, as housing spokesperson, called
(23:12):
it was a key we build underwrite, I think a
financial black hole. Is there a difference between I mean,
I don't know how much time you've had to look
into the detail of this, Calvin, But what is your
gut reaction to this, separate to a political reaction?
Speaker 4 (23:24):
Maybe yeah, So this is all about the issue for
a lot of developers at the moment is you need
to get pre sales or a sufficient number of pre
sales or percentage of a units have to be pre
sold so you've got some cash in so you can
keep the project off and sort of satisfy the bank
and keep things rolling. It's about sort of cash flow
and liquidity. Now just recently those pre sales have been
(23:46):
quite hard to get. So this scheme is about I
suppose the government's stepping in and I don't think necessarily
buying the units, but probably the funding effectively becoming the
pre sales without actually owning the units. So the liquidity
goes in and the cash goes in, and you know,
the developer can press ahead. Now it is only it's
big to be is the projects have to be at
(24:06):
least thirty units. They have to have an established trait record.
There's a whole bunch of criteria attached, so you know
it's probably not just going to be you know, your
local builder sort of putting up two units. That's going
to access this sort of established people who can prove
their credentials approve all of that. So yeah, it's it's
it seems to be a pretty good idea. You know,
(24:27):
there's no point sort of wasting these projects just for
a lack of finance. You can get that finance because
we know housing demand will come back. We're going in
there more new builds in future, so we can step
in and kind of fill that Void's it seems to
be a pretty good idea to me.
Speaker 5 (24:42):
Part of a huge suite of meshus.
Speaker 4 (24:44):
The government's doing it, as you said, Chris Busher, really
pushing art on this. Another thing that announced last week
was was streamlining the consending process. So perhaps reducing the
number of authorities that approve building consents.
Speaker 5 (24:57):
Maye that process smoother and streamlined. So so yeah, it
all adds up to that.
Speaker 4 (25:02):
It's all part of this wider push to an and
more housing supply.
Speaker 3 (25:06):
Well do you think those are the two of the
Do you think that this and the streamlining of the
consenting progress process? Do you think those are the two
big things? Or there's some other bigger part that you said,
it's a suite of actions the government's taking. Are there
some other things that have stood out to you as
a as an economist that will make a big difference
to the property market.
Speaker 4 (25:26):
Yeah, there's a ranger. So those a couple of things
that have just been announced recently. You've got the consent
for granny flats which was announced a while ago.
Speaker 3 (25:35):
Sixty that's bloody massive too, by the way, isn't it.
Speaker 4 (25:38):
Yes, Yeah, yeah, yeah, there's a decent sized, decent sized
granny flat for sure, cheaper, important, more allowing important materials
and substitution materials to come in and compete with with
local materials, get importing them in without necessarily having to
meet the same sort of quality standards if they've been
improved overseas they should be fine here. So there's that
as well. But I think for me, probably the biggest
(26:00):
one is more around the land supply stuff, So forcing
councils to plan for thirty years of growth, really putting
pressure on to enable more land to be made to
be made available, because I think that is probably the
big sort of restraint on things, as having enough land
in the right places with the right infrastructure to get
(26:21):
these projects off the ground. So all these things will help,
but probably that that for me, is the biggest one.
It's about forcing councils to zone this land, make sure
the land's available so we can get these houses, and
all these other things will help, but that that supplies
a biggie.
Speaker 7 (26:36):
It's quite a.
Speaker 3 (26:37):
Sort of I might get my terminology wrong here, but
I remember when Chris, when I first heard Chris Bishop
talking really passionately about he wants to keep I'm not
even seeing that it's sortially be said he wants to
drive to house prices down, but he wants to make
housing more affordable. That's probably the mantra, but it is
he's really driving a strong sort of it's almost I
(26:58):
wouldn't say socialist policy, or is it, you know what
I mean, it's what's your take on it. Is it
a surprising policy for someone from maybe center right government,
or or is it just great news that he's trying
to encourage as many key weis to own houses.
Speaker 4 (27:15):
Yeah. I wouldn't wade into the politics necessarily. And I
think what we've said correctly is that the governments of
both sides of the equation were you know, national or labor,
haven't always been that successful in housing supply. So I
think probably we're just in a situation now where you know,
you put aside the politics and you just have to say, great,
they're pushing really hard.
Speaker 5 (27:34):
Let's hope it works.
Speaker 4 (27:36):
Let's get more housing supply, and let's get more people
into the market, different types of houses, different locations, the
right infrastructure, all that. So you know, I'm fully in
behind it. Putting aside the politics. I think it's just
a good idea to try and push really hard on
these things. So let's hope it works, I guess is
the main conclusion for me.
Speaker 7 (27:55):
Yeah.
Speaker 3 (27:55):
The other thing is I was wondering if there's an argument,
and look at some of my arguments are half baked
because I'm not an economist, but you know how we
have this and this is probably slightly outside your remit,
but I'm sure you've got a passing interest in it.
But a lot of the argument around CGTS and all
the sort of thing is about, and a lot of
(28:17):
some of the argument it's about that we have this
obsession with property, and we have the secession as investors
with buying a property, you know, getting some rental, sitting
on it for a number of years, and then selling
it for a big profit, because we've been told to
basically plan for your own retirement. And it seems that
what Bishop is doing is almost in a way, it's
(28:38):
a more organic way of addressing that, because people, it's
encouraging investment into new housing, which might mean that it
might make housing, but does it make housing slightly just
the standard investment model of buying a house, you know,
sitting on it for a while, does it make it
a little less sexy and therefore push money into other
areas of the economy that are more productive. I wish
(28:59):
I could have found a better way of saying that,
but do you.
Speaker 7 (29:01):
Know what I mean?
Speaker 5 (29:02):
Yeah, I mean it could possibly.
Speaker 4 (29:04):
There's been a lot of research done over the past
couple of years into what drives house prices, and I
think interest rates are obviously part of it, credit rules, affordability,
all of that. I suppose the three key things that
have really stood out is that it's about land supply,
it's about your tax system, and it's about mortgit rates.
So if you think about the future from here, well,
(29:24):
it does look like we're going to see more land
supply opened up, perhaps relative to what we've seen historically. Okay,
there's always debate about the tax rules. It does feel
like we're creeping slowly towards perhaps a tax system that's
a little bit less favorable for property. Now it might
not be capital gains, it could be a land tax
(29:44):
down the track, who knows, but it does feel like
we're moving that way. So tax system a bit less
favorable more land supply, the long term trend we've seen,
and interest rates can't continue. You can't go from twenty
you can't keep going lower and low and lower in
terms of interest rates. So those things that have driven
house prices historically are perhaps not going to be as
(30:05):
important as they have, not going to be as important
in the future as they have been in the past.
Then you add in the fact that house prices are
already high, you're adding things like the debt to income ratios.
I think you can build a reasonably solid case that
capital growth in future would be less than what I've
seen historically. Now it's we're probably going to still see
house prices go up because wages go up, that sort
(30:25):
of thing, but perhaps a bit less growth in future
than what I've seen historically.
Speaker 5 (30:29):
So we'll still have properly investors.
Speaker 4 (30:30):
There will still be money to be made, but perhaps
it might be a bit less than what I've seen
in the future, and does not so much argument around
home ownership.
Speaker 3 (30:39):
Not so much fly by night more than sort of
traditional investors who are in for the long term.
Speaker 5 (30:44):
Yeah.
Speaker 4 (30:44):
Well, and that's every property investor I speak to is
that's generally what they're there to do. It's, hey, I
just want to pay down my mortgage. I want to
by the time I retire, I want to have a
mortgage free asset and I can live off the rent,
or at least try to live off the rent. So
that is I think that most people I speak to
are those genuine kind of long term investors who want
to have a good time, don't provide a good property
(31:06):
and pay down that debt. Now, yes, some capital gain
has always helped, and that has been a big benefit
in the past. I think it will continue in future
as well, but perhaps not as strongly as it has done.
Speaker 3 (31:16):
Yeah, certainly, of course. Something that's the thing if you
do research just by reading property headlines, you'll get quite
a skewed version of the market because often the headlines
are the most dramatic stories, like somebody flips property on
for this, and that makes you think that that's the
game everyone's playing, isn't it anyway.
Speaker 4 (31:30):
Yeah, that's right, And there's a lot of stats around this.
It's very hard again to nail down precisely, but there
are stats around saying that most landlords are in perhaps
one property, it might be two tops, so the whole
they are genuine long term landlords. So we want to
provide a good service and they're just sort of trying
to pay off that debt to fund their retirement. That
model is what I hear a lot about. And yes,
(31:51):
there are people outside that group, and they are there
to kind of get some capital game, maybe flip some properties.
But if they are acknowledged by ourd as property traders,
while they'll be text on that anyway. So yeah, there's
sometimes the headlines can can skew the reality.
Speaker 3 (32:07):
Of course, exactly right. We're going to be back with more. Actually,
i'd like to you if you'd like to give us
a call. We'd love to hear from you on you know,
we've on your opinion on the government underwriting some developments
which were funnily enough described as a financial black hole
by five years ago by Nationals a spokesperson for Housing
Judith Collins. But now that they want to get supply going,
(32:27):
they want to give developers, some developers, the reliable ones
that they trust, I guess, some level of surety to
get things going. Do you support this and what the
effect do you think it's going to have on the market.
Will it deliver that sort of maybe more affordable housing
that Chris Bishop has been advocating he wants to see
for all New Zealanders And what does it mean for
the property market in general? Your reckons and opinions on
(32:49):
eight hundred eighty ten eighty it's eighteen minutes to five
news talks. He'd b.
Speaker 8 (32:56):
I get down, Yes, welcome back to the one roof
radio showing with the Chief Property economist at core Logic
for Calvin Davidson actually just probably go into it, Calvin,
(33:18):
just remind people what core Logic do.
Speaker 4 (33:22):
We're data and analytics company and the property markets so
provide a range of services to anybody who's in real estate,
whether that's agents obviously the banks are a big client,
mortgage brokers or aggregators, insurance, construction, the public sectors. But
we provide all the addressing to the emergency services, which
(33:43):
is a really really sort of positive thing within the business.
If you need an ambulance, you need the ambulance needs
to know where to go very quickly, obviously, so we
provide that addressing, make sure that's up to date and maintained.
So yeah, across a wide range of anything that's involved
with property, we're sort of you know, we're touching on.
Speaker 3 (34:02):
And of course, I mean obviously people certain industries will
pay for your advice, but you also do have newsletters
that go on go out about the property market as
well that people can get ahold of.
Speaker 5 (34:12):
Aren't there yep, yep.
Speaker 4 (34:14):
Call Logic dot co dot in z you'll find our research.
So I'm an economist, I mean I'm basically an end
user of all of that other information that goes to
our clients, and I'm there to sort of use that information,
tell some stories about the property market, hopefully give some
insight into what's going on. And we do a lot
of presentations as well. So I suppose the research side
of the business is about it's about education. A lot
(34:37):
of it's free, and it's about just just talking about
the market, sort of a public service in some ways.
Speaker 3 (34:43):
Just on that announcement of the government's under planning to
underwrite some property developments, and it's been I think National
has been criticized for being a bit hypocritical about it
because they criticized the key we build underwrite, But of
course that was the government building houses and underwriting and
doing the whole kitten kerboodle. Whereas I gather here, the
(35:03):
government is not going to be actually invest They're simply
underwriting and if something falls over, they'll own the houses
that haven't been delivered. But beyond that, it's like it's
more of an underwrite rather than we are the government
we're building the world.
Speaker 5 (35:18):
Yeah, I think that's that's right that it seems.
Speaker 4 (35:21):
I mean, it's early days yet, but the criteria criteria
around this new scheme seems to be a lot higher.
It's targeting projects that are already approved. It's just a
liquidity thing. It's with big developers with established track records,
and I guess at this point in the cycle, in
some ways reading between the lines, the government probably hopes
(35:41):
they don't have to put in anything at all because
eventually it will just fund the project, it will get
it quickly off the ground, the money will come back
and effectively they won't be putting in anything at all.
So I'd say it aimed at a sort of a
different funding model, perhaps not as not intended to be
as big, because keep in mind Key we Build was
the grand hundred thousand dollars hundred thousand properties target. Probably
(36:06):
you're just probably operating at a different stage of the
process and maybe with different criteria too.
Speaker 3 (36:13):
That also, I guess the question for the government and
where they'll be accountable is if they back a big
white elephant or something and find themselves with a bit
of a turd where we've got to pay a hold
of money for something that doesn't really have much value,
and that'll that does put a fair a little bit
of pressure on the officials to make sure that they
are working with what one tried and trusted developers on
(36:34):
projects that generally genuinely stack up.
Speaker 5 (36:38):
Yep, that's right, yeah, yeah.
Speaker 4 (36:39):
And if you read some of the documentation around this
new scheme, and it actually says that they're going to
be actively talking with the developers who they think might
be eligible in advance of an application. So they actually
only want sort of one hundred percent applications to come in.
They don't want to be rejecting applications because they want
to filter out the people who might not meet the
(37:00):
criteria before they ever get to that stage. So I
think they really are looking for the sort of cream
of the up, those people who have long track records
with a really financially viable project other than for whatever reason,
you just can't quite get funding or those pre sales.
And then so the white elephants, I suppose you're always
trying to minimize that risk. I guess it's always there,
but they'd hope read that out first.
Speaker 3 (37:22):
Excellent, Well, we're gonna come back in just a moment
with one roof. Property of the Week is next. It's
quite a doozy. You might need to win, and you know,
sort of second or third stage powerball to really afford
this one, but what the hell. I'll give you the description.
You can go and check it out yourself for yourselves,
because it is a beauty. It's ten minutes to five.
News talks'd b start?
Speaker 7 (37:44):
You can't start, guess.
Speaker 3 (37:58):
Welcome back to the Weekend Collective. This is one roof
radio show. Of course, a little bit of Bruce Springsteen,
just because we've eate that bit of an information out
of Calvin Davidson from Core Logic that he quite likes
a bit of the boss.
Speaker 7 (38:09):
It is.
Speaker 3 (38:10):
What's the time? It's coming up to six minutes to five.
Speaker 1 (38:13):
The one roof property of the week on the Weekend Collective.
Speaker 3 (38:18):
Now I sort of sold that I did tease. This
property has been quite spectacular. But it's an interesting one
because it is eight hundred and the address is eight
one five pour Aquino Valley Road, which is in obviously
pour Achino Valley at Southland. Now it is tricky because
there's no estimate of the price. The RV is seven mil,
(38:39):
seven million dollars. It's four bedroom, three bathroom, two car garage,
six hundred square metres, big house, two stories, and it
does look pretty grand. It's got to marble tide floors
in a chandelier, a quite an extravagant stair case. It's
a two story colonial homestead built built in twenty twelve.
But the interesting thing is when you see the photos,
(39:00):
it looks like there's a little bit of work to
be done on just the bit of it. Looks like
it's sitting on a fairly bear patch of land, and
so I reckon, if you're up for this sort of thing,
there could be what do I know, a little bit
of haggling involved. But what did you make of it, Calvin?
Because it does look like there's room to sew a
bit of grass, doesn't there?
Speaker 7 (39:16):
I put it that way.
Speaker 4 (39:17):
Yeah, yeah, I'm a big fan of nice green lawns,
so yeah, you could definitely make those improvements. But yeah,
great looking house and fair Midland too. Looks like some
native forest on there, so yeah, i'd say, incredible opportunity.
I know my wife's from Southland are down near Riverton
there the houses, so I know the area pretty well
and great spots, so yeah, someone would probably pick up
(39:41):
a bargain there.
Speaker 5 (39:41):
I'd say, you think do.
Speaker 3 (39:42):
You think that there'd be room for haggling, isn't it?
Because I was surprised that I just saw that there
was a bit of look like the grass has been
sort of taken out and they're about to resow some
and they just had to get those photos taken.
Speaker 5 (39:54):
Yeah.
Speaker 4 (39:54):
Possibly possibly. Yeah, It's like I say, great, a nice
lawn aroundy property. So yeah, a great opportunity there and
a huge looks like a huge amount of a native
bush around there. So someone I really enjoy that, I'd imagine.
Speaker 3 (40:07):
Yeah, good on you. Actually the rural outlook as well.
I mean people in New Zealand bang on about a
seaview and who doesn't love a good cview on a
mountain view. But there is something about some of the
rural aspects of New Zealand and is the rural outlook
there with the farmland and the bush behind it absolutely gorgeous.
So go and check that out. It is just need
(40:27):
to look on the one roof for radio one roof
site sorry one roof dot Curtain is eight one five
Perchino Valley Road. And as I say that, Calvin time
has raced by. We've covered covered a little bit. But
if people want to check out the work of call logic,
they just go to call Loge dot curtain, is it right?
Speaker 5 (40:42):
Yep, that's right, yep.
Speaker 4 (40:43):
And like I said, we're out there with rest and research.
It's it's all available on our website. We have a podcast.
We do a lot of media work, so people will
have seen our stuff, no doubt, in some shape or form.
And yeah, we're reporting every week on the market. So yeah,
hopefully good pulse.
Speaker 3 (40:58):
Good stuff. Okay, we'll be back with a parent squad
next this News Talks.
Speaker 5 (41:01):
There'd be.
Speaker 1 (41:05):
For more from the Weekend Collective. Listen live to News
Talk ZEDB weekends from three p m. Or follow the
podcast on iHeartRadio.
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