September 5, 2026 • 41 mins
The OCR changed this week, The Reserve Bank has upped it from 2.5% to 2.75%.
But mortgages are already high, some unlucky buyers are now finding they owe more than the value of their house as equity erodes.
So if you're in this situation, what can you do? Opes Mortgages Managing Director Peter Norris joins Tim Beveridge to answer your questions.
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Speaker 1 (00:05):
You're listening to the Weekend Collective Podcast from Newstalk ZB.
Speaker 2 (00:09):
I just want.
Speaker 1 (00:13):
To breathe.
Speaker 3 (00:14):
Maybe I just don't believe. Maybe you're the same as me.
We see things I'll never see.
Speaker 1 (00:20):
You and I are gonna make it work.
Speaker 3 (00:27):
I said lately, I don't really want to know. And
your body rolls, cause I just want to fly. Lately,
I feel as if I feel the pain.
Speaker 1 (00:44):
In the morning rain, I'm so itchy today. Welcome back
to the Weekend Collective. I'm Tim Beveridge, and this is
the One Roof Radio Show. We want your calls on
0800 80 1080 to text 9292. But don't forget, if
you missed any of the hours, you can go and
check out the podcast after 6 o'clock. And the reason
I say after 6 o'clock is because you don't want
(01:05):
to miss what's going on right now. I mean, this
is right now. So, by the way, just looking ahead
to after 5 o'clock, we've got Auckland Grammar School Principal
Tim O'Connor is with us, and we're going to talk
about just, among other things, just the whole... way parents should, could,
would interface with their schools through the years. Because, you know,
(01:26):
year one's different to year 12. So we're going to
have a chat and dig into that with Tim O'Connor
at five o'clock. But right now, it's the One Roof
Radio Show. And we want your calls on 0800 80 1080.
0800 80 1080, text 9292. And the talk this week,
before I introduce my guest, the Reserve Bank put the
OCR up. It's moved from 2.5% to 2.75%. There's normally
(01:51):
a bit of a knock-on effect with these things, but
I'm not sure if there has been a hell of
a lot because hasn't everyone seen it coming? I mean, actually,
a question for you if you're listening. Are you waiting
with bated breath for these announcements, or do you think
that the banks have priced them in already so it's
not contributing to your sense of urgency? Because as we know,
the first-time buyers have been a large part of the
(02:13):
market because... properties have come off, come down on the
back of ridiculously cheap money following COVID. And if you
haven't caught up with those headlines, you're looking at the market.
So yeah, but the mortgage rates are already up there.
It's probably been priced in, but it does feel, I mean,
(02:33):
who knows what's going to happen? They're always very careful
with their language. It does feel that there's no way
down from here would be my take. It's not going backwards.
So what does it mean for you and your intentions
with property? Um, because we, even I can, I can
tell by the nature of the conversations we've had on
the show over the past year or two, that there's a,
there's a certain momentum that was present in the market
(02:54):
where there was this urgency. It's like, if you've got to,
you want to get in, you've just got to get
in as soon as you get the deposit, save it up,
get in because you know, um, houses are not getting
any cheaper. Oh, they did get cheaper. Oh, they're still cheaper.
So what does this OCR mean for you? Um, we
want your thoughts on 0800 80, 10 80. What does it,
how does it affect your intentions? All those around you, people,
(03:16):
if you're talking about property, what do you reckon? Is it, oh,
interest rates might be starting to move a little bit.
Maybe now is the time. Anyway, those are some of
the questions we're going to dig into. And my guest
is from AuPair's Mortgages. He's the money man, I guess,
isn't he? His name is Peter Norris, and he's with
me now. Peter, g'day.
Speaker 3 (03:35):
G'day.
Speaker 1 (03:36):
How's things?
Speaker 3 (03:37):
Yeah, real good, thank you.
Speaker 1 (03:37):
Yeah, well, so, I mean, what... Tell us, what was
your reaction leading into the announcement by the Reserve Bank
Governor and where we're going?
Speaker 3 (03:47):
I think the more interesting thing was around what was
said as opposed to what was actually done. The 0.25
move was largely expected.
Speaker 1 (03:55):
Yes.
Speaker 3 (03:56):
And it was more around what was said to the markets.
In my view, had already priced it in, the floating
rates moved almost immediately.
Speaker 1 (04:04):
Yeah. I mean, the floating rate is directly attached to,
you know, the floating rate is the one thing that
does move.
Speaker 3 (04:10):
Yeah, interestingly, yeah, exactly. So the banks moved on those
almost immediately. But in my view, they'd already priced in
the fixed rates. And interestingly, the two-year swap actually came
down off the back of that OCR going up because
of market expectations.
Speaker 1 (04:25):
What's a two-year swap?
Speaker 3 (04:26):
So the swap rates are what kind of tells us
what the markets are expecting interest rates to do over time.
Speaker 1 (04:32):
So where does it get the word swap from? How
does that come into it?
Speaker 3 (04:37):
It's swapping. It's typically what the banks borrow at.
Speaker 1 (04:39):
Okay. Okay, so what happened with the two-year?
Speaker 3 (04:44):
So that came down. So what that suggests is the
markets are expecting that it has already been priced in.
What we saw off the back of Wednesday's announcement was
that ANZ suggested or forecast that the one-year rate would
hit 5 to 5.1 this time next year, which actually
it's not too far off right now.
Speaker 1 (05:02):
I'd better actually have a look at that. I suddenly
realised I need to bring up the website that shows
me what all the different– interest rates are, but you
probably have them off the top of your head, don't you?
Speaker 3 (05:11):
Yeah, we do it pretty regularly.
Speaker 1 (05:13):
Actually, how often do you actually go, let me just check,
let me just update that?
Speaker 3 (05:18):
Well, the swap rates we're checking every day, but in
terms of what the banks are doing, we know that
pretty regularly.
Speaker 1 (05:24):
Okay. So the cash rate is now, sorry, the OCR,
official cash rate, 2.75. So it's gone up 0.25%. Did
we see much, what did we see move apart from
the floating?
Speaker 3 (05:39):
All we've seen so far move is the floating rates.
Speaker 1 (05:42):
Really? So nothing else?
Speaker 3 (05:43):
No, nothing else has moved. Over the last, well, since
the bottom of the swap rates, so the swap rates
have bottomed out around about 2.4. They're about 1% above that.
The OCR has only moved about 0.5 since that time.
So the market has priced in a lot of that
movement already.
Speaker 1 (06:02):
Okay. So they're priced in that movement. What about the
next announcement? I mean, how much have they priced in?
Because some of the, look, I'm not glued to this stuff,
but I listen to enough of the news to hear
that there's anticipation that they will pop it up again.
But what did the Reserve Bank governor say?
Speaker 3 (06:20):
So they're saying that there's a neutral rate that they're
aiming at around between 3 and 3.25. Okay, so logically
it has to go up then. Yeah, exactly.
Speaker 1 (06:28):
Why wouldn't they put it up?
Speaker 3 (06:29):
So by early next year, the Reserve Bank's saying the
OCR will be at that neutral rate or targeting that
neutral rate. So that would suggest that between now and
early next year, there's three announcements. We're probably likely to
see one to two increases.
Speaker 1 (06:43):
So how much of that has been priced in then?
Speaker 3 (06:45):
I think a lot of it has been priced in.
I think we will, you made the point. I don't
think we're going down from here. There's a lot more
likelihood that interest rates are going up rather than down.
Speaker 1 (06:54):
Well, that's the thing. In fact, you'd be, there's no
way it's going down, is there? I mean, I don't
know what would have to happen for there to be
a downward.
Speaker 3 (07:03):
Well, no, I agree. I think you can only take
forecast based on the information you have and invariably forecasts
are wrong. And we've seen that time and time again.
You've seen unforeseen things happen over the last five years
that suggest that anything's possible. But it does look like
the only way is up from here. But not too much,
(07:23):
I don't think.
Speaker 1 (07:25):
Okay. So if we're at 2.75, We're really only, what
did you talk about the neutral rate being maybe 3, 3.25? Yeah, exactly. So,
I mean, we might almost see no movement. So I'm
starting to wonder whether my introduction where I was talking
about people thinking I better dust off my office and
get moving now is all bleh.
Speaker 3 (07:48):
Yeah, well, no, I think there's still movement. I think
based on what the Reserve Bank said, you'll see one
to two more increases and a little bit of that
pushed into the interest rates as well. So I do
think interest rates will trend upwards from here. But again,
I don't think we're going to see the big spike
in interest rates that we saw a couple of years ago.
A bit more of a conservative movement, Reserve Bank's confidence
(08:08):
that they'll get inflation under control by doing this.
Speaker 1 (08:11):
Because that's the other bit of talk is that I
heard that we are not as badly off as we
think we are getting ahead of things, seems to be
the official talk. It's just whether people believe it, I guess,
on the ground, or does that not matter? Wow.
Speaker 3 (08:25):
And yeah, it's interesting because on the ground, it does
feel like things are pretty tough. But based on the
Reserve Bank data, we're heading in the right direction and
they're confident of that.
Speaker 1 (08:34):
Well, that's good. Yeah. What would throw a spanner in
the works? Because we've got so much international turmoil going on.
I don't know what's going on. I've tuned out of
what's going on over in the Strait of Hormuz and
with the Trump administration because it seems to be one
day it's on, then the next day it's off, then
there's Ukraine and all that. We're living in a turbulent world.
I mean, what do you guys keep an eye on
when it comes to the effect on our cash rate?
Speaker 3 (08:56):
Yeah, I mean, there's certain things that we can control.
There's certain things that we can't. The local inflation appears
to be reasonably under control. It's sort of the international-influenced inflation,
which is less under control. And when you say what
could happen, I mean, the geopolitical stuff carries on for longer.
It escalates. Those are the sorts of things that could
maybe push this.
Speaker 1 (09:16):
Why is 3% the sort of– I mean, explain that
for people who go, why does it have to be 3%?
Why is that the number? Why is it not 5?
Why is it not 1.5? And, I mean, it'll be
based on what the reserve banks say probably, but why
do they settle on that as a sort of neutral rate?
Speaker 3 (09:31):
It's where they view sort of neutral meaning that things
can kind of tick along steadily without getting out of control.
They don't need to hike them aggressively, and they don't
need to pull them down overly aggressively either. So it's
where they see that kind of long-term stability or– Yeah,
got a sort of stable economy. So that's where that
neutral rate comes from. What we've seen in the last, well,
(09:54):
pre-COVID and certainly post-COVID was the OCR fall very, very aggressively.
Some would take too far and they'd have to go
very aggressively back the other way. So what they're looking
for is a bit more consistency.
Speaker 1 (10:06):
Okay. So what did you notice following the rate? Do
you notice any change in momentum in the inquiries you
have or the business you guys do at OPS Mortgages?
Speaker 4 (10:16):
No.
Speaker 3 (10:17):
I mean, from our side, things have been reasonably good.
a little bit quieter than what we would expect. We
deal with a lot of investors, and investors are reasonably
quiet at the moment, especially coming up to the election,
a lot of uncertainty around how tax changes will impact investors.
So for that reason, a lot of our sort of
(10:37):
usual buyers are a little bit quieter than they would be,
but we'd expect that to start to change. We've also
seen recent data come out that suggests Auckland's at a
new bottom of the market.
Speaker 1 (10:48):
A new bottom?
Speaker 5 (10:48):
Yeah.
Speaker 3 (10:49):
A new bottom, yeah, where we thought the bottom of
the market was a year or 18 months ago. We've
gone beyond that.
Speaker 1 (10:55):
Okay. So how much value do we put in that
prediction that there's a new bottom when they might go, oh,
that was the new bottom six months, a year ago.
Now we're at the new bottom.
Speaker 3 (11:07):
Yeah, well, hindsight's 20-20, right? But I mean, the Reserve
Bank at the moment is forecasting growth in the property
market over the next couple of years.
Speaker 1 (11:14):
On what basis?
Speaker 3 (11:16):
Well, based on all of the measures they're looking at,
we've been flat to down for quite a long time.
If you look at Auckland, obviously it's at a new low.
Other parts of the country are actually going along pretty well. Christchurch,
Queenstown region are going quite well. So it's not national. Yeah.
Speaker 1 (11:33):
Actually, how much difference is there between the markets at
the moment? Where does Auckland sit in relation to, you
tell me if I get outside York, because I know
you're the mortgage guy, you're not a property, you're not
selling it, but How different are the markets in New Zealand,
one to the other?
Speaker 3 (11:50):
Very different. I mean, as I said, Auckland's hit a
new bottom, and yet if you compare Christchurch or the
likes of Queenstown, you're seeing growth in those areas. In fact,
certain parts of Christchurch are growing faster than anywhere else
in the country. So out sort of Rolleston way, those
satellite centres are growing faster than anywhere else.
Speaker 1 (12:07):
What about Wellington?
Speaker 4 (12:08):
Wellington?
Speaker 1 (12:09):
I don't imagine that's too flash at the moment because
they've got so much infrastructure and challenges.
Speaker 3 (12:13):
Well, Wellington's had a tough time for the last few years.
Speaker 1 (12:15):
They have, haven't they? I really sort of feel for Wellingtonians.
Speaker 3 (12:18):
Yeah, no, their properties, anyone who bought a property back
then at the peak has suffered big.
Speaker 1 (12:24):
Yeah.
Speaker 3 (12:24):
Probably Wellington more so than anywhere else.
Speaker 1 (12:26):
I think they probably have, yeah. Okay. Actually, I've got
lots of questions here to get into, but we're with
Peter Norris. He's Managing Director at OPS Mortgages. So we're
talking about the money. The OCR changed this week. It
went from 2.5% to 2.75%. Has it affected your intentions
or thoughts around the property market based on one simple
(12:49):
idea that it's not going down anytime soon? Or is
there someone out there who thinks, oh, no, no, no, no, no, no, no.
It could go down, you know, because.
Speaker 3 (12:58):
I don't know.
Speaker 1 (12:58):
You'd have to tell me why. 0800 0800 80 1080,
text 9292. This is the Weekend Collective. Love to take
your calls on this and your thoughts on what the
market's doing. 0800 80 1080. It is coming up to
20 past four, Newstalk ZB. Yes, Newstalk ZB, this is
the One Roof Radio Show. I'm Tim Beveridge. My guest
is Peter Norris, Managing Director at OPS Mortgages. And look,
(13:23):
we just want your reckons on what's going to happen
with the housing market. OCR is on the move a
little bit. It's not going to go very far. It's
not going to get a lot more expensive, we don't reckon,
but it's not going down. So what does it mean
for your intentions and what's going to happen with the
property market? I'm taking your calls on 0800 80 1080.
By the way, you don't have to have the answer
(13:45):
to the meaning of life. You might just have a reckon,
and Peter will have a comment on it as well,
and then we'll see if we're both all the wiser
for sharing that point of view. Right, let's go to Neville. G'day.
Speaker 2 (13:56):
G'day. How are you doing?
Speaker 1 (13:58):
Good, thanks. How are you?
Speaker 2 (13:59):
Yeah, good, good, good. About the mortgage interest rates, I
just wanted to make a brief comment, if that's okay.
Speaker 5 (14:04):
Yeah.
Speaker 1 (14:06):
Yeah.
Speaker 2 (14:07):
I listened to the comments about the OCR going 2.5, 2.75,
and then talking about if it goes to three, maybe
three and a quarter.
Speaker 1 (14:16):
Yeah.
Speaker 2 (14:16):
And I think your comment was what's going to put
a spinner in the works.
Speaker 1 (14:20):
Oh, yeah.
Speaker 2 (14:21):
You know? And I'm thinking to myself, hey, this is
just totally taking the wrong approach to all of this.
Speaker 5 (14:26):
Yeah.
Speaker 2 (14:27):
And that's a negative approach.
Speaker 1 (14:28):
Yeah.
Speaker 2 (14:28):
And I think the approach that should be talked more
about is the fact that compared to five years ago,
the median house price is now 6.2 times the median salary,
whereas it was 10.5 times five years ago. So the
affordability factor is way better now than it was. Combine
(14:51):
that with the median household income requires now less than 40%
allocated to debt servicing than it was five, and it
was way above that five years ago. Actually, that sounds
a massive difference.
Speaker 1 (15:09):
That's a massive difference.
Speaker 2 (15:11):
And people, media completely missed the positive aspect of this
picture because it is huge.
Speaker 1 (15:16):
Actually, Neville, you're right. So where did you, and Peter's
sitting here nodding his head. How have I missed it?
Is it just because the property authors have not, It.
Speaker 2 (15:29):
Was published about three weeks ago from the survey that
was carried out and it got about two seconds of
airtime because it's not what banks and it's not what
That's not what a lot of people want people to
hear because it's too positive. The economy is in good shape.
It is in good shape for house buyers. It hasn't
been this good for first-time buyers in a very long time.
Speaker 1 (15:48):
I've got here, I've just done a quick Google, housing affordability.
You can chip in any. Actually, you're nodding there, Peter.
I'll turn your microphone on. That helps.
Speaker 3 (15:56):
Yeah, thanks. No, I totally agree. I think your positive
approach to this is bang on. And I think that
you mentioned banks don't want to hear it. I think
the banks probably do. And I think the banks have
played a reasonably big part in that, especially with the
debt to income ratio. So they're limiting how much people
can borrow. And I think that's had a big effect
on that.
Speaker 2 (16:15):
I totally agree that risk assessment for banks and doing
stress testing is excellent. And that's the only negative. We
don't want people saying, what's going to put a spanner
in the works? Because that's looking at it from the
reality point of view.
Speaker 1 (16:28):
Actually, Neville, I think I'm sort of sitting here sort
of reeling because I hadn't, I hadn't actually looked at
those numbers. I've always just assumed that even with the
housing price drop, that property was bloody expensive. But you're saying, well,
in terms of the percentage of income....
Speaker 2 (16:46):
It might be expensive compared to 2005 and 2010, but.
Speaker 1 (16:53):
What was it then?
Speaker 2 (16:54):
This is 2026. I can't give you the ratios from then,
I don't know.
Speaker 4 (17:00):
OK.
Speaker 1 (17:01):
What's your skin in the game?
Speaker 2 (17:03):
I'm retired.
Speaker 1 (17:05):
You've got too much time on your hands.
Speaker 4 (17:08):
No, I don't.
Speaker 2 (17:10):
I have been involved in a few industries. Can I
make a brief comment on something else that is related
to real estate?
Speaker 1 (17:15):
Yeah, away you go. Yeah, why not?
Speaker 2 (17:17):
Okay. Well, thank you. I listened to the comments previously
about the licensing requirements and the hour and a half
required for relicensing and compulsory professional development for Maori training
and education.
Speaker 1 (17:33):
Oh, no, let's not worry about that one. We're going
to stick with the property side of things, Neville. But
just quickly, can you just give me those numbers again
that you're aware of? Because the Google search I've done,
and it's a very quick one, is that the affordability
of houses in Auckland is 6.7 to 6.9 versus what
was 9.6 to 9.7 about three years ago. Is that
about right, what you understand for Auckland?
Speaker 2 (18:00):
The stat I was referring was a national statistic, not
a local one. Oh, good.
Speaker 1 (18:03):
No, that's great. Hey, good on you, mate. I appreciate
your call. Yeah, the other one's a little off the topic,
so we'll leave that one alone, but we do appreciate
your call. 0800 80 10 80. Actually, why... I mean,
maybe I'm just not reading enough, but, yeah, I mean,
it's taken a talkback call to point that out. To me,
(18:23):
I would have thought that was quite a big sort
of headline, that housing affordability has massively changed.
Speaker 3 (18:29):
Yeah, I think, I mean, you can see that in
the numbers of first-home buyers in the market, right? I
think it's, last check, it's 28% of the market was
first-home buyers, which is awesome. That's a real reflection that
it is a bit more of a buyer's market at
the moment, and first-home buyers are seeing that opportunity to
get in. Investors, obviously, are sitting on their hands until
later this year, see what happens. But the first-home buyers
(18:51):
being in the market is a good sign, and I
do think that banks capping how much, or being capped
on how much they can lend to owner occupiers to
six times income is reflective in those numbers as well.
Speaker 1 (19:03):
Gosh. Yeah. Okay. Let's take some more calls. 0800 80 1080.
Your reckons on what the change in the cash rate means,
because there's another thing that's come up in the conversation,
which to me is the elephant in the room. And
Peter's just mentioned, we've got an election. And if you
were an investor, look, I'm not an investor, but if
I was thinking of doing it, I wouldn't be have
(19:25):
a snowball's chance in hell of doing anything right now
because I don't know what the government's going to be
like in a few months. That's a massive uncertainty for participation,
isn't it?
Speaker 3 (19:33):
Yeah, absolutely. I mean, just to give an example there,
we had a client the other day who said they
want to put a property under contracts just before the
election into due diligence during the election, but not confirm
unless they know what has happened with the election. So
depending on which way that goes, they'll confirm or not confirm,
which is a real sign of thinking.
Speaker 1 (19:52):
Does due diligence give them regal room if there's a
change in government?
Speaker 3 (19:56):
Yeah, because they're not unconditional at that point, right? So
they're just entering.
Speaker 1 (19:59):
What's due diligence? Is that just like until I change
my mind?
Speaker 3 (20:03):
Yeah, it's just a period of time. It's generally 10
to 15 days between the time when they say, yep,
I want to put that property on hold and yep,
I want to confirm and pay a deposit.
Speaker 1 (20:12):
Wow. That's quite the out, isn't it? Well, yeah, absolutely.
Speaker 3 (20:15):
But it's normal if you put a property under contract,
there's some time, you want to make sure you can
get finance, you might want to get a builder's report. Yeah.
Speaker 1 (20:21):
I bet when I was studying law, there was the
out which you'd say it's subject to purchaser solicitor's approval,
and it's been realised that actually that's just an out,
total out.
Speaker 3 (20:31):
Yeah, absolutely.
Speaker 1 (20:32):
So this sounds like the new easy out.
Speaker 3 (20:33):
Yeah, absolutely.
Speaker 1 (20:34):
Okay. We'll be back in... Actually, no, we're going to
be back in just a moment. We're going to take
a call from Kelvin. G'day.
Speaker 4 (20:40):
Good afternoon, Tim. Good afternoon to your guests. Mortgage rates
don't affect me because I don't borrow money. I lend money.
But what I wanted to find out is that I
hear more often than not people being concerned with the
price of houses going down. But I can never understand
what there's any concern about because if you're going to
(21:02):
sell your house and get a lower price than you
would have last month as such, the next house you're
buying must have gone down in price. So everything more
or less balances out.
Speaker 1 (21:13):
Well, if you're buying and selling in the same market,
that's known as, yeah. I mean, Peter, comments?
Speaker 3 (21:20):
Yeah. I mean, yeah. I mean, if you sell for
less than what you bought for, then that's when you
realize your loss, right? So our view of that is
to hold. And at the end of the day, if
you own an asset and it's gone down in value,
then at least you own the asset and you can
hold on through that. But yeah, I mean, there is
that argument that you're buying and selling in the same market,
but not everyone's selling in order to buy.
Speaker 1 (21:40):
Is there a bit of an emotional block there that
people just don't like to sell even though they're going
to be– I mean, if you're buying and selling in
the same market and you need to move, then you
just do it anyway, don't you? I don't know.
Speaker 3 (21:52):
Well, if you need to do it, if there's a
real need there, then it's irrespective of what the market's doing.
But I would– yeah, I mean, not everyone is selling
in order to buy.
Speaker 4 (22:01):
But surely most people would be– if they're selling their house,
most people would be buying again on that same market.
They wouldn't be waiting six months or a year or
anything to buy another house, surely.
Speaker 3 (22:14):
It depends on if they're owner-occupiers or if they're relocating.
I would have thought if you're a lender, mortgage rates
would very much affect you.
Speaker 5 (22:21):
Yes.
Speaker 1 (22:22):
Are you talking about lending someone $ 100 or are you
talking about lending someone a couple of hundred thousand, Kelvin?
Speaker 4 (22:28):
Yes, the latter.
Speaker 1 (22:30):
Oh, the latter. Oh. Yeah, the latter, yeah. So do
I come to you if I need a loan? How
do you end up loaning if you've just got money to,
you know.
Speaker 4 (22:40):
Well, a lot of it's to do with not spending it,
isn't it? That's how you accumulate money.
Speaker 1 (22:45):
But who's borrowing money from you?
Speaker 4 (22:47):
Well, the banks borrow money.
Speaker 1 (22:48):
Oh, you mean you deposit it in the bank and
you call it lending?
Speaker 4 (22:52):
Yeah, the banks are borrowing money all the time, aren't they?
Speaker 1 (22:54):
Okay, so you're just talking about when you stick your
money in the bank, you are lending it to the bank.
Is that the way you're talking about it?
Speaker 4 (23:01):
Yeah, yeah. Depending on what the amounts are, of course.
Speaker 1 (23:05):
Yes, okay. And what are they giving you for your money?
Speaker 4 (23:09):
Well, at the moment, I think it's under 5%, so
that part of it doesn't really matter.
Speaker 1 (23:14):
Well, it does matter. Surely it matters to you, doesn't it?
Doesn't it matter to you?
Speaker 4 (23:19):
No, it doesn't make any difference to my life. The
reality is it's only to do with if you've possibly
over-mortgaged yourself. You're borrowing a large amount and then interest
rates go up or down or whatever. Yeah. No, life
just goes on the same.
Speaker 1 (23:36):
You're just fairly sanguine about it. You're pretty relaxed about
these things. It's life. What goes up must come down.
I've got this.
Speaker 2 (23:42):
Oh, yeah.
Speaker 4 (23:42):
I'm extremely relaxed.
Speaker 1 (23:44):
Yeah. Well, that's a good. Lucky old you in that respect. Yep.
Good on you, Kelvin.
Speaker 4 (23:49):
Anyway, that's all the best. Thank you.
Speaker 1 (23:51):
Thanks, mate. I'm not sure what to make of that
from Kelvin. Thoughts, Peter?
Speaker 3 (23:57):
I thought he said he was a lender in so
much case mortgage rates absolutely affect him. But, of course,
if he's an investor as well, then it.
Speaker 1 (24:02):
He's being semantically, instead of depositing his money in the bank,
he's saying that's his money and the bank is borrowing it,
which is not the way that you or I were
thinking of lending. But I know Kelvin from other talkback calls,
and I realize he's just being creative with the way
you can think about these things. Technically, I guess if
(24:23):
you let the bank have your money and they pay
you interest for it, perhaps they are borrowing it.
Speaker 3 (24:27):
Yeah, and he's in a good position to not have
to care what they're paying him.
Speaker 1 (24:30):
And he doesn't need to have a mortgage document because
you can just tell the bank he wants it back. Okay, yeah. Okay.
Let's go– actually, I'll tell you what. Let's take some–
let's go to some texts, I think. Somebody said, due diligence.
It gives the purchaser time to research any underlying problems
that may have been overlooked. It's not just in case
(24:51):
the purchaser changes their mind or time to imply– or
time to apply for a loan, not every person has
to borrow to purchase a property. Yeah, that due diligence
is an interesting one. So you've got a client who's,
they're going to put an offer in and then have
due diligence period. Is there a restriction what they can
(25:15):
justifiably say, look, I've done my due diligence? Do they
have to have particular grounds to get out of it?
Speaker 3 (25:21):
Not for our clients. Our clients have within their contract
basically a get out for whatever reason, you can wake
up on the wrong side of the bed and decide
I'm done and exit. That's within our clients' contracts.
Speaker 1 (25:32):
So what sort of sellers are happy with that? Just
happy to get a buyer, are they?
Speaker 3 (25:36):
Yes, it's developers, so we're selling. Our clients are investing
in new build. Oh, okay.
Speaker 1 (25:43):
It's a bit more complex than that. It's not just
I want to buy your house and I'm going to
do due diligence and now it's a Labour government, I'm out.
Speaker 3 (25:49):
No, no, no, not quite. But the text is right.
I mean, there's different due diligence that can be done
on a property. Some people don't need finance. Some people
don't care if they want a building report or not,
and some people do. But during that time, you can
negotiate what due diligence you want.
Speaker 1 (26:03):
Okay. Hey, how many people are actually getting the building examined?
I'm not thinking developers now, but just when it comes
to buying a property, how many people are getting a
builder's inspection or a vendors supplying those because they're extra
keen to sell it?
Speaker 3 (26:20):
Good question. I think that would depend on the agent
and depend on the deal. All of our clients are
buying new builds.
Speaker 1 (26:26):
Yeah.
Speaker 3 (26:27):
So they'll have certain things that they'll have included in
their contracts. We don't see too much of.
Speaker 1 (26:31):
That in our market. That's your particular area. Yeah, right. Okay. Look,
0800 80 1080 is the number with Peter Norris. He's
Managing Director at OPS Mortgages. And, well, we're having a
general chat about the OCR, what it means for the market.
Is it going to make a big difference to it?
Or I'm getting the sense it's going to make... What's
the technical expression? Bugger all difference. That'd be my conclusion
(26:53):
so far. You can tell me if I'm wrong. 0800
8010 80P to count after the break. It's 24 minutes
to five. Newstalk ZB. I'm Tim Beveridge. We're with Peter Norris.
He's Managing Director. Oh, just dropped my mouse. Hang on. Sorry. Oh, God.
Now it's all gone. I can't even click on a
call if I need to.
Speaker 5 (27:06):
Hold it.
Speaker 1 (27:07):
Hold it.
Speaker 5 (27:08):
Sorry.
Speaker 1 (27:09):
Just dropped the mouse on the floor and we'll just
fix it.
Speaker 3 (27:12):
Sorry.
Speaker 1 (27:15):
Yeah, I think that's working. Let's see.
Speaker 4 (27:17):
Yes, it is.
Speaker 6 (27:18):
Hurrah.
Speaker 1 (27:18):
It means we can say hello to... That would have
been difficult, wouldn't it? If I broke a mouse in
the studio... Anyway, fun times at Newstalk ZB. My guest
is Peter Norris. We're talking about the cash rate, the
effect on the market, where we're going. And actually, I
started the show, by the way, if you've just joined us,
I started the show saying, well, it's not going backwards.
So surely there'd be some momentum to get in and
(27:40):
get cracking. But It's not actually going up much further,
so maybe I'm full of it. So let's see what
you reckon. Oh, 880, 1080. Simon, hello.
Speaker 4 (27:50):
Yo.
Speaker 5 (27:52):
Yeah, how's it going?
Speaker 3 (27:53):
Good, thanks.
Speaker 1 (27:53):
What's up?
Speaker 5 (27:54):
Very well. So I, at the moment, have just gone
down to my yard to unload a load of furniture
because I am under due diligence at the moment in
purchasing a first home. And I was completely new to
all of this. You know, I've been in New Zealand
for 20 years, worked hard all my life.
Speaker 4 (28:13):
Yeah.
Speaker 5 (28:14):
Um, and yeah, Jujula Dinch is awesome. It gives you
a chance to do things like get a building inspector
and to check out the things. I'm a builder. And
even the things that he saw, I didn't see.
Speaker 1 (28:25):
What did he say?
Speaker 5 (28:25):
Um, uh, all sorts, cracked roof tiles, asbestos fence, um, uh,
maybe a leak problem because there was new carpets, um,
all sorts of things, a little bit of rot under here,
a little bit of rot under there. Are you still
going ahead with it? Yeah, yeah, yeah, definitely. Great time
to buy at the moment. I lived in Auckland, as
(28:47):
I say, for 20 years. Lived in Matakana 20 years
ago when it was a farming town. Now look at
that place. Just buying in South Auckland. South Auckland, when
I moved here, was like, oh my gosh, once more warriors.
But not anymore. Everything's changed. Everything.
Speaker 1 (29:02):
That's nice. You know what, that's actually nice.
Speaker 5 (29:04):
My wife's from South America. You know, it's great in
this country. Love it. Wouldn't change it for the world, mate.
Speaker 1 (29:09):
That is so nice to hear, Simon, because we have
so much doom and gloom, isn't it? Good on you.
Speaker 5 (29:14):
My friend, my friend, I've got a 14 month, I'm
41 years old. I've got a 14 month old daughter.
My wife is just a little bit younger than me.
And we've got another one on the way, a little
boy in November, just about to be first home buyers.
We go unconditional on Tuesday and then the real fun begins.
Speaker 1 (29:33):
Wow.
Speaker 5 (29:33):
But yeah, it's a great time to buy. Just look
around people. Don't give up. Anyone can do it. If
I can do it, anyone can do it.
Speaker 1 (29:41):
Don't go anywhere. Hang on, Simon. Peter, you were sort
of nodding along. as well. What do you reckon?
Speaker 3 (29:46):
I was just thinking that. You've got all the positive
callers coming in today. It's great putting a positive spin
on what's going on. I think it's awesome. It's good
to hear. And great work in your first home.
Speaker 5 (29:53):
If I had longer to talk to you, I've been
doing building over here. I'm born to be a builder.
And I've never seen it this quiet in the last
couple of months. A lot of my friends have been
quiet in the last couple of years of work. A
lot of immigration coming in, a lot of builders, but
the difference is there's a lot of builders, but there's
too many wheelbarrow pushers, not enough skilled builders. So we're
(30:18):
still good.
Speaker 3 (30:19):
Are you doing new build houses or renovations?
Speaker 5 (30:22):
I do everything, everything, everything, yeah. So I'm a stonemason
by trade, so I used to build your castles and
your stone walls. Now I'm foundations. dig big holes, fill
them with concrete. I do KO housing, or as they
call it, sorry, TRC, Potamica Regeneration Corporation. I do a
lot of those. We do private builds.
Speaker 1 (30:42):
Yeah.
Speaker 5 (30:42):
We're starting to get back into the 150, 170 plus slabs.
Speaker 1 (30:48):
Yeah.
Speaker 5 (30:48):
So people are starting to now buy again. You know,
it was a bit worrying, but house prices are definitely alive.
Speaker 1 (30:55):
Hey, can I ask, you know, you talked about you
were in Matakana back when it was a rural community.
Now it's, you know, Matakana. Do you still own something there,
or did you sell out before it became.
Speaker 4 (31:05):
No, I've never owned. I've never owned.
Speaker 1 (31:07):
Oh, I've never... I swear I missed that bit.
Speaker 5 (31:09):
First-time buyer. No, I've earned silly amounts of money.
Speaker 1 (31:14):
So whereabouts have you bought?
Speaker 5 (31:18):
In Papatoe.
Speaker 1 (31:20):
Okay.
Speaker 5 (31:20):
So just off Great South Road. It's a nice little place.
It's one of two dwellings, so it's a split lease.
Speaker 1 (31:28):
Yeah.
Speaker 5 (31:29):
It's at the end. I have the wraparound garden, 400
square land, 100 square house. The garage is a step down,
and it's a third of the house, so I'm going
to change it into a double bedding. I can put
an extension on it that doubles the footprint. You just
turn it from $ 650, 000 to a mil.
Speaker 1 (31:48):
So do you think you're going to live in it,
do it up, and then sell it sort of thing,
like an investor who's living in his own house?
Speaker 2 (31:56):
So.
Speaker 5 (31:57):
As I said, 14-month-old daughter, one on the way, 40
years old.
Speaker 4 (32:01):
Buying a house.
Speaker 1 (32:02):
Mate, you're not going anywhere.
Speaker 5 (32:03):
Mate, I'm happy.
Speaker 1 (32:08):
It's nice to hear that. Can I ask one more question? What,
under due diligence, would you have decided not too much?
Speaker 5 (32:17):
Oh, you see.
Speaker 1 (32:19):
Or is it just thinking time?
Speaker 4 (32:20):
Three weeks ago, we looked at the house.
Speaker 5 (32:22):
Three weeks ago, we looked at the house. It's the
first house we looked at. They say you shouldn't get
the first one that you look at, but this thing
was too good to be true. Before you know it,
the bloody lawyers are involved and the real estate agent.
And then it's like, right, do this, do that, do that.
It goes so fast. Too diligent. You have to be careful.
(32:42):
I noticed earlier on, you said 10 to 15 days.
You have to say working days.
Speaker 2 (32:47):
Yeah, it's a good point.
Speaker 5 (32:48):
Don't get caught out on that.
Speaker 1 (32:51):
Good on you. It's just nice to hear your positivity.
And funny enough, we had an asbestos fence on the
flat that we bought our unit from the landlord. But
the one thing we removed, it turned out to be
an asbestos fence.
Speaker 5 (33:07):
Um but hey i've um i've got to relieve one
of those soon so if you want to buy another
one mate no.
Speaker 1 (33:12):
Mate no no we've we've we replaced ours we replaced
ours with a bit of to do but um yeah
good on you.
Speaker 5 (33:20):
Mate take care excellent great chat be safe take care.
Speaker 1 (33:23):
Bye i haven't heard of that i mean look he's
just going an exciting time in his life child on
the way you know.
Speaker 3 (33:30):
Well to be fair he's one of the he's one
of the first time buyers that i mentioned earlier right
they're they're very much in the market at the moment.
It's a great time to be a first-home buyer.
Speaker 1 (33:36):
What's the... I mean, when you are talking to your
clients on this, I mean, your first-home buyers that you're
dealing with, they're buying into developments, are they?
Speaker 3 (33:45):
Yeah, to be fair, we don't deal with first-home buyers
really at all, a little bit on the mortgage side,
but not so much, definitely not on the property side.
Speaker 1 (33:51):
Okay, yeah. Sorry, I got my wires crossed on that.
Let's have a look at a couple of texts before
we're going to move on and we're going to go to...
The one roof property of the week, actually, is a house...
Quite a unique house, which we'll get onto in a moment.
But I have actually stayed there. So I sort of
know a bit more about the house than just, you know,
(34:12):
the description that's in the real. In fact, I'm looking
forward to going through the photos and seeing how different
it is from when I was staying there on the
shores of Lake Rotorua. So, but we'll do that in
a moment. Let's have a look at a few texts.
As a, here we go. Tim, we just had 30
groups to our open home. Many are first-time buyers. We're upsizing,
and it turns out to be a great time to
(34:32):
do it. Sad for the few who are in negative equity,
but overall lower house prices are great for people in
the economy. Actually, the negative equity situation, that's a tricky one.
It sucks that you bought and you've got negative equity,
but if you're buying to move, I guess you'd make an...
(34:54):
How would you deal with someone who's got negative equity
as a lender?
Speaker 3 (34:57):
Wow. So as a lender, there's really nothing that actually happens, right?
So negative equity is bad when you're selling. First off,
it's great that you've got the asset to begin with.
Speaker 1 (35:07):
Yeah.
Speaker 3 (35:08):
And as long as you're able to hold while interest
rates increase, then over time, our view is that long term,
you'll do all right. If you bought three years ago,
then you're probably not doing all right. And you may
be in that negative equity space. But banks aren't going
to call in loans. They don't go and check LVRs
and just start calling in loans because property values have dropped.
Speaker 1 (35:26):
No.
Speaker 5 (35:26):
No.
Speaker 1 (35:26):
So does it mean that– what's the process when it
comes to you've got to sell and buy? How does
that work if you want to move? Are you stuffed or– Well.
Speaker 3 (35:34):
If you're downsizing, if you're going into a position where
you're selling and you're selling for less than what you owe,
then that's obviously not a good position because you still
owe that money.
Speaker 1 (35:43):
So that's just not going to work. So you just
can't take that borrowing and go and buy a new house.
So it is problematic.
Speaker 3 (35:48):
Yeah, that's problematic. And that person's space, when you're upgrading
at the moment, yeah, it's a great time because you're selling–
buying in the low market as.
Speaker 1 (35:57):
Well okay um another comment here it says as an
old fart with term deposits i hope interest rates go
to about eight or ten percent as they used to
be however i've got a well however i've got a
daughter granddaughter and grandkids in welly who own a house
each that have devalued markedly they desperately want to sell
and go back to live in canada poor buggers are
(36:17):
going to take an articaning um it doesn't sound like
he really wants interest rates to go up there i
mean it If you care about your family.
Speaker 3 (36:25):
Feedback off back to Canada, then what does it impact him, right?
It'll take his 8%. But no, I don't think that's
quite the right way to look at it.
Speaker 1 (36:34):
No, no, indeed. Anyway, look, we're going to come back
with the one roof property of the week in just
a moment. And a little teaser, it belongs to the
owners of one of New Zealand's iconic housing styles slash brand,
And we'll be back with that in just a moment.
(36:55):
And it's in my old neck of the woods in Rotorua,
known as Kawaha Point. I have no idea if you're
supposed to pronounce it Kawaha Point or Kawaha Point, because
we just call it Kawaha Point. So apologies if my
pronunciation is wrong, but I said it for decades. So
there we go. We'll be back in just a moment.
It is 10 and a half minutes to five. The
(37:17):
One Ruth Property of the Week on The Weekend Collective. Yes,
welcome back. The One Roof Property of the Week is,
I'll give you the address, and if you are near,
you know, not when you're driving, of course, don't search
for it. It is 22 Parra, T-U-P-A-R-A, Crescent, Kawaha Point, Rotorua. Now,
it is the house of Joe LeGrew, Joanne and Joe LeGrew,
(37:40):
who are, well, they're the, he's the king of Lockwood,
the Lockwood buildings. And as the article says, what does
the king of Lockwood build for himself? You've got it.
It's an all-wood house. Lockwood on steroids, chateau overlooking the
waters of Lake Rotorua. Now, Joe and Joanne are great
supporters of the arts and through endeavours. I used to
(38:02):
live in Kaua Point when I'd visit Rotorua. I've stayed
with them on a few occasions in this house. And
it's a giant Lockwood. I don't know how to describe it.
The setting is magnificent. The view in from the driveway,
it's 600 odd square metres of Lockwood. What do you reckon, Peter?
Speaker 3 (38:21):
I think the article sums it up beautifully. Lockwood on steroids.
I think it's exactly one of those. Everywhere you look,
it's Lockwood.
Speaker 5 (38:27):
Yes.
Speaker 1 (38:27):
I mean, so he is the owner of Lockwood Homes. Basically,
they designed this architectural legacy. It was designed to stand
the test of time. It's a tricky one to value
because Lockwood is Lockwood, and it really is in the
traditional style in terms of the color of the timber
and everything. I don't know how you'd value it because
even the article and the listing are have a couple
(38:49):
of different sort of values on it. What did you think?
Speaker 3 (38:51):
Yeah, there's a couple of million dollars difference between what
the listing or what OneRoof suggests it could be worth
versus what the article says there's a valuation at.
Speaker 1 (38:58):
Well, it said there's a, this is interesting. It says
that the registered valuation reached 4.58 million, but the rating
valuation is 2.93 million.
Speaker 3 (39:15):
Yeah, so the registered valuation is a proper value of
going to the site and saying this is what it's worth.
So that's what the agents said in the article.
Speaker 1 (39:23):
So it's an interesting one. I wonder who would buy
it because the look inside, what you you almost could
do you'd do nothing with it wouldn't you but it's
it is of an era.
Speaker 3 (39:34):
Yeah absolutely I think you either love it and do
absolutely nothing to it or possibly you hate it and
you do a lot to it right I think that's
really your two options you wouldn't do a bits and
pieces reno to.
Speaker 6 (39:45):
That property right there's no ambivalence involved with it actually
that probably sums up Lockwoods in a way um I reckon,
here's the other thing.
Speaker 1 (39:55):
I mean, it's such a distinctive residence. You could almost
imagine someone taking it over and turning it into a
bit of a B & B sort of thing, you know,
turning it into a guest house. They've got the driveway.
They've got the, I don't know.
Speaker 3 (40:07):
Yeah, I mean, it's quite stunning, really. It's a beautiful location.
It's got some jetty right on the lake.
Speaker 1 (40:12):
Yeah, and it's got the big, I mean, the big
stone fireplace. As I say, it's what we go back
40 years. What are we at? The sort of, oh,
the 80s. Oh. It's funny. It sort of feels a
bit more of a 75.
Speaker 3 (40:25):
Doesn't seem like that far ago, right?
Speaker 1 (40:26):
Yeah, there you go.
Speaker 3 (40:27):
I mean, that house is 600 square metres. That's bigger
than the last caller's lamb that he's just bought.
Speaker 1 (40:31):
Yeah. No, it is fantastic property, and it's totally unique
as well. So do go and check it out. I'll
mention that address again. It was, oh, easy to find
a one roof, but just your 20 Tupara, T-U-P-A-R-A, forgiveness
on the pronunciation, Kawaha Point in Rotorua. And you can
go and check that out. And, hey, Peter, great to
(40:52):
see you, mate.
Speaker 3 (40:53):
Thanks for having me. Yeah, good stuff.
Speaker 1 (40:54):
And thanks for everyone for your participation. We will be
back next with the parent squad. We've got the principal,
the headmaster. Gosh, headmaster sounds sterner, doesn't it? The headmaster
of Auckland Grammar is with us, Tim O'Connor. We're going
to talk about, among other things, just, you know, the
relationship between school and parents and how to manage that
as your children get a little bit older, as the
(41:16):
years go by. We'll be back shortly. This is the
Weekend Collective News Talk ZB, three minutes to five. For
more from the Weekend Collective, listen live to News Talk
ZB weekends from 3 p.m. or follow the podcast on iHeartRadio.
You're listening to the Weekend Collective Podcast from Newstalk ZB.
Speaker 2 (00:09):
I just want.
Speaker 1 (00:13):
To breathe.
Speaker 3 (00:14):
Maybe I just don't believe. Maybe you're the same as me.
We see things I'll never see.
Speaker 1 (00:20):
You and I are gonna make it work.
Speaker 3 (00:27):
I said lately, I don't really want to know. And
your body rolls, cause I just want to fly. Lately,
I feel as if I feel the pain.
Speaker 1 (00:44):
In the morning rain, I'm so itchy today. Welcome back
to the Weekend Collective. I'm Tim Beveridge, and this is
the One Roof Radio Show. We want your calls on
0800 80 1080 to text 9292. But don't forget, if
you missed any of the hours, you can go and
check out the podcast after 6 o'clock. And the reason
I say after 6 o'clock is because you don't want
(01:05):
to miss what's going on right now. I mean, this
is right now. So, by the way, just looking ahead
to after 5 o'clock, we've got Auckland Grammar School Principal
Tim O'Connor is with us, and we're going to talk
about just, among other things, just the whole... way parents should, could,
would interface with their schools through the years. Because, you know,
(01:26):
year one's different to year 12. So we're going to
have a chat and dig into that with Tim O'Connor
at five o'clock. But right now, it's the One Roof
Radio Show. And we want your calls on 0800 80 1080.
0800 80 1080, text 9292. And the talk this week,
before I introduce my guest, the Reserve Bank put the
OCR up. It's moved from 2.5% to 2.75%. There's normally
(01:51):
a bit of a knock-on effect with these things, but
I'm not sure if there has been a hell of
a lot because hasn't everyone seen it coming? I mean, actually,
a question for you if you're listening. Are you waiting
with bated breath for these announcements, or do you think
that the banks have priced them in already so it's
not contributing to your sense of urgency? Because as we know,
the first-time buyers have been a large part of the
(02:13):
market because... properties have come off, come down on the
back of ridiculously cheap money following COVID. And if you
haven't caught up with those headlines, you're looking at the market.
So yeah, but the mortgage rates are already up there.
It's probably been priced in, but it does feel, I mean,
(02:33):
who knows what's going to happen? They're always very careful
with their language. It does feel that there's no way
down from here would be my take. It's not going backwards.
So what does it mean for you and your intentions
with property? Um, because we, even I can, I can
tell by the nature of the conversations we've had on
the show over the past year or two, that there's a,
there's a certain momentum that was present in the market
(02:54):
where there was this urgency. It's like, if you've got to,
you want to get in, you've just got to get
in as soon as you get the deposit, save it up,
get in because you know, um, houses are not getting
any cheaper. Oh, they did get cheaper. Oh, they're still cheaper.
So what does this OCR mean for you? Um, we
want your thoughts on 0800 80, 10 80. What does it,
how does it affect your intentions? All those around you, people,
(03:16):
if you're talking about property, what do you reckon? Is it, oh,
interest rates might be starting to move a little bit.
Maybe now is the time. Anyway, those are some of
the questions we're going to dig into. And my guest
is from AuPair's Mortgages. He's the money man, I guess,
isn't he? His name is Peter Norris, and he's with
me now. Peter, g'day.
Speaker 3 (03:35):
G'day.
Speaker 1 (03:36):
How's things?
Speaker 3 (03:37):
Yeah, real good, thank you.
Speaker 1 (03:37):
Yeah, well, so, I mean, what... Tell us, what was
your reaction leading into the announcement by the Reserve Bank
Governor and where we're going?
Speaker 3 (03:47):
I think the more interesting thing was around what was
said as opposed to what was actually done. The 0.25
move was largely expected.
Speaker 1 (03:55):
Yes.
Speaker 3 (03:56):
And it was more around what was said to the markets.
In my view, had already priced it in, the floating
rates moved almost immediately.
Speaker 1 (04:04):
Yeah. I mean, the floating rate is directly attached to,
you know, the floating rate is the one thing that
does move.
Speaker 3 (04:10):
Yeah, interestingly, yeah, exactly. So the banks moved on those
almost immediately. But in my view, they'd already priced in
the fixed rates. And interestingly, the two-year swap actually came
down off the back of that OCR going up because
of market expectations.
Speaker 1 (04:25):
What's a two-year swap?
Speaker 3 (04:26):
So the swap rates are what kind of tells us
what the markets are expecting interest rates to do over time.
Speaker 1 (04:32):
So where does it get the word swap from? How
does that come into it?
Speaker 3 (04:37):
It's swapping. It's typically what the banks borrow at.
Speaker 1 (04:39):
Okay. Okay, so what happened with the two-year?
Speaker 3 (04:44):
So that came down. So what that suggests is the
markets are expecting that it has already been priced in.
What we saw off the back of Wednesday's announcement was
that ANZ suggested or forecast that the one-year rate would
hit 5 to 5.1 this time next year, which actually
it's not too far off right now.
Speaker 1 (05:02):
I'd better actually have a look at that. I suddenly
realised I need to bring up the website that shows
me what all the different– interest rates are, but you
probably have them off the top of your head, don't you?
Speaker 3 (05:11):
Yeah, we do it pretty regularly.
Speaker 1 (05:13):
Actually, how often do you actually go, let me just check,
let me just update that?
Speaker 3 (05:18):
Well, the swap rates we're checking every day, but in
terms of what the banks are doing, we know that
pretty regularly.
Speaker 1 (05:24):
Okay. So the cash rate is now, sorry, the OCR,
official cash rate, 2.75. So it's gone up 0.25%. Did
we see much, what did we see move apart from
the floating?
Speaker 3 (05:39):
All we've seen so far move is the floating rates.
Speaker 1 (05:42):
Really? So nothing else?
Speaker 3 (05:43):
No, nothing else has moved. Over the last, well, since
the bottom of the swap rates, so the swap rates
have bottomed out around about 2.4. They're about 1% above that.
The OCR has only moved about 0.5 since that time.
So the market has priced in a lot of that
movement already.
Speaker 1 (06:02):
Okay. So they're priced in that movement. What about the
next announcement? I mean, how much have they priced in?
Because some of the, look, I'm not glued to this stuff,
but I listen to enough of the news to hear
that there's anticipation that they will pop it up again.
But what did the Reserve Bank governor say?
Speaker 3 (06:20):
So they're saying that there's a neutral rate that they're
aiming at around between 3 and 3.25. Okay, so logically
it has to go up then. Yeah, exactly.
Speaker 1 (06:28):
Why wouldn't they put it up?
Speaker 3 (06:29):
So by early next year, the Reserve Bank's saying the
OCR will be at that neutral rate or targeting that
neutral rate. So that would suggest that between now and
early next year, there's three announcements. We're probably likely to
see one to two increases.
Speaker 1 (06:43):
So how much of that has been priced in then?
Speaker 3 (06:45):
I think a lot of it has been priced in.
I think we will, you made the point. I don't
think we're going down from here. There's a lot more
likelihood that interest rates are going up rather than down.
Speaker 1 (06:54):
Well, that's the thing. In fact, you'd be, there's no
way it's going down, is there? I mean, I don't
know what would have to happen for there to be
a downward.
Speaker 3 (07:03):
Well, no, I agree. I think you can only take
forecast based on the information you have and invariably forecasts
are wrong. And we've seen that time and time again.
You've seen unforeseen things happen over the last five years
that suggest that anything's possible. But it does look like
the only way is up from here. But not too much,
(07:23):
I don't think.
Speaker 1 (07:25):
Okay. So if we're at 2.75, We're really only, what
did you talk about the neutral rate being maybe 3, 3.25? Yeah, exactly. So,
I mean, we might almost see no movement. So I'm
starting to wonder whether my introduction where I was talking
about people thinking I better dust off my office and
get moving now is all bleh.
Speaker 3 (07:48):
Yeah, well, no, I think there's still movement. I think
based on what the Reserve Bank said, you'll see one
to two more increases and a little bit of that
pushed into the interest rates as well. So I do
think interest rates will trend upwards from here. But again,
I don't think we're going to see the big spike
in interest rates that we saw a couple of years ago.
A bit more of a conservative movement, Reserve Bank's confidence
(08:08):
that they'll get inflation under control by doing this.
Speaker 1 (08:11):
Because that's the other bit of talk is that I
heard that we are not as badly off as we
think we are getting ahead of things, seems to be
the official talk. It's just whether people believe it, I guess,
on the ground, or does that not matter? Wow.
Speaker 3 (08:25):
And yeah, it's interesting because on the ground, it does
feel like things are pretty tough. But based on the
Reserve Bank data, we're heading in the right direction and
they're confident of that.
Speaker 1 (08:34):
Well, that's good. Yeah. What would throw a spanner in
the works? Because we've got so much international turmoil going on.
I don't know what's going on. I've tuned out of
what's going on over in the Strait of Hormuz and
with the Trump administration because it seems to be one
day it's on, then the next day it's off, then
there's Ukraine and all that. We're living in a turbulent world.
I mean, what do you guys keep an eye on
when it comes to the effect on our cash rate?
Speaker 3 (08:56):
Yeah, I mean, there's certain things that we can control.
There's certain things that we can't. The local inflation appears
to be reasonably under control. It's sort of the international-influenced inflation,
which is less under control. And when you say what
could happen, I mean, the geopolitical stuff carries on for longer.
It escalates. Those are the sorts of things that could
maybe push this.
Speaker 1 (09:16):
Why is 3% the sort of– I mean, explain that
for people who go, why does it have to be 3%?
Why is that the number? Why is it not 5?
Why is it not 1.5? And, I mean, it'll be
based on what the reserve banks say probably, but why
do they settle on that as a sort of neutral rate?
Speaker 3 (09:31):
It's where they view sort of neutral meaning that things
can kind of tick along steadily without getting out of control.
They don't need to hike them aggressively, and they don't
need to pull them down overly aggressively either. So it's
where they see that kind of long-term stability or– Yeah,
got a sort of stable economy. So that's where that
neutral rate comes from. What we've seen in the last, well,
(09:54):
pre-COVID and certainly post-COVID was the OCR fall very, very aggressively.
Some would take too far and they'd have to go
very aggressively back the other way. So what they're looking
for is a bit more consistency.
Speaker 1 (10:06):
Okay. So what did you notice following the rate? Do
you notice any change in momentum in the inquiries you
have or the business you guys do at OPS Mortgages?
Speaker 4 (10:16):
No.
Speaker 3 (10:17):
I mean, from our side, things have been reasonably good.
a little bit quieter than what we would expect. We
deal with a lot of investors, and investors are reasonably
quiet at the moment, especially coming up to the election,
a lot of uncertainty around how tax changes will impact investors.
So for that reason, a lot of our sort of
(10:37):
usual buyers are a little bit quieter than they would be,
but we'd expect that to start to change. We've also
seen recent data come out that suggests Auckland's at a
new bottom of the market.
Speaker 1 (10:48):
A new bottom?
Speaker 5 (10:48):
Yeah.
Speaker 3 (10:49):
A new bottom, yeah, where we thought the bottom of
the market was a year or 18 months ago. We've
gone beyond that.
Speaker 1 (10:55):
Okay. So how much value do we put in that
prediction that there's a new bottom when they might go, oh,
that was the new bottom six months, a year ago.
Now we're at the new bottom.
Speaker 3 (11:07):
Yeah, well, hindsight's 20-20, right? But I mean, the Reserve
Bank at the moment is forecasting growth in the property
market over the next couple of years.
Speaker 1 (11:14):
On what basis?
Speaker 3 (11:16):
Well, based on all of the measures they're looking at,
we've been flat to down for quite a long time.
If you look at Auckland, obviously it's at a new low.
Other parts of the country are actually going along pretty well. Christchurch,
Queenstown region are going quite well. So it's not national. Yeah.
Speaker 1 (11:33):
Actually, how much difference is there between the markets at
the moment? Where does Auckland sit in relation to, you
tell me if I get outside York, because I know
you're the mortgage guy, you're not a property, you're not
selling it, but How different are the markets in New Zealand,
one to the other?
Speaker 3 (11:50):
Very different. I mean, as I said, Auckland's hit a
new bottom, and yet if you compare Christchurch or the
likes of Queenstown, you're seeing growth in those areas. In fact,
certain parts of Christchurch are growing faster than anywhere else
in the country. So out sort of Rolleston way, those
satellite centres are growing faster than anywhere else.
Speaker 1 (12:07):
What about Wellington?
Speaker 4 (12:08):
Wellington?
Speaker 1 (12:09):
I don't imagine that's too flash at the moment because
they've got so much infrastructure and challenges.
Speaker 3 (12:13):
Well, Wellington's had a tough time for the last few years.
Speaker 1 (12:15):
They have, haven't they? I really sort of feel for Wellingtonians.
Speaker 3 (12:18):
Yeah, no, their properties, anyone who bought a property back
then at the peak has suffered big.
Speaker 1 (12:24):
Yeah.
Speaker 3 (12:24):
Probably Wellington more so than anywhere else.
Speaker 1 (12:26):
I think they probably have, yeah. Okay. Actually, I've got
lots of questions here to get into, but we're with
Peter Norris. He's Managing Director at OPS Mortgages. So we're
talking about the money. The OCR changed this week. It
went from 2.5% to 2.75%. Has it affected your intentions
or thoughts around the property market based on one simple
(12:49):
idea that it's not going down anytime soon? Or is
there someone out there who thinks, oh, no, no, no, no, no, no, no.
It could go down, you know, because.
Speaker 3 (12:58):
I don't know.
Speaker 1 (12:58):
You'd have to tell me why. 0800 0800 80 1080,
text 9292. This is the Weekend Collective. Love to take
your calls on this and your thoughts on what the
market's doing. 0800 80 1080. It is coming up to
20 past four, Newstalk ZB. Yes, Newstalk ZB, this is
the One Roof Radio Show. I'm Tim Beveridge. My guest
is Peter Norris, Managing Director at OPS Mortgages. And look,
(13:23):
we just want your reckons on what's going to happen
with the housing market. OCR is on the move a
little bit. It's not going to go very far. It's
not going to get a lot more expensive, we don't reckon,
but it's not going down. So what does it mean
for your intentions and what's going to happen with the
property market? I'm taking your calls on 0800 80 1080.
By the way, you don't have to have the answer
(13:45):
to the meaning of life. You might just have a reckon,
and Peter will have a comment on it as well,
and then we'll see if we're both all the wiser
for sharing that point of view. Right, let's go to Neville. G'day.
Speaker 2 (13:56):
G'day. How are you doing?
Speaker 1 (13:58):
Good, thanks. How are you?
Speaker 2 (13:59):
Yeah, good, good, good. About the mortgage interest rates, I
just wanted to make a brief comment, if that's okay.
Speaker 5 (14:04):
Yeah.
Speaker 1 (14:06):
Yeah.
Speaker 2 (14:07):
I listened to the comments about the OCR going 2.5, 2.75,
and then talking about if it goes to three, maybe
three and a quarter.
Speaker 1 (14:16):
Yeah.
Speaker 2 (14:16):
And I think your comment was what's going to put
a spinner in the works.
Speaker 1 (14:20):
Oh, yeah.
Speaker 2 (14:21):
You know? And I'm thinking to myself, hey, this is
just totally taking the wrong approach to all of this.
Speaker 5 (14:26):
Yeah.
Speaker 2 (14:27):
And that's a negative approach.
Speaker 1 (14:28):
Yeah.
Speaker 2 (14:28):
And I think the approach that should be talked more
about is the fact that compared to five years ago,
the median house price is now 6.2 times the median salary,
whereas it was 10.5 times five years ago. So the
affordability factor is way better now than it was. Combine
(14:51):
that with the median household income requires now less than 40%
allocated to debt servicing than it was five, and it
was way above that five years ago. Actually, that sounds
a massive difference.
Speaker 1 (15:09):
That's a massive difference.
Speaker 2 (15:11):
And people, media completely missed the positive aspect of this
picture because it is huge.
Speaker 1 (15:16):
Actually, Neville, you're right. So where did you, and Peter's
sitting here nodding his head. How have I missed it?
Is it just because the property authors have not, It.
Speaker 2 (15:29):
Was published about three weeks ago from the survey that
was carried out and it got about two seconds of
airtime because it's not what banks and it's not what
That's not what a lot of people want people to
hear because it's too positive. The economy is in good shape.
It is in good shape for house buyers. It hasn't
been this good for first-time buyers in a very long time.
Speaker 1 (15:48):
I've got here, I've just done a quick Google, housing affordability.
You can chip in any. Actually, you're nodding there, Peter.
I'll turn your microphone on. That helps.
Speaker 3 (15:56):
Yeah, thanks. No, I totally agree. I think your positive
approach to this is bang on. And I think that
you mentioned banks don't want to hear it. I think
the banks probably do. And I think the banks have
played a reasonably big part in that, especially with the
debt to income ratio. So they're limiting how much people
can borrow. And I think that's had a big effect
on that.
Speaker 2 (16:15):
I totally agree that risk assessment for banks and doing
stress testing is excellent. And that's the only negative. We
don't want people saying, what's going to put a spanner
in the works? Because that's looking at it from the
reality point of view.
Speaker 1 (16:28):
Actually, Neville, I think I'm sort of sitting here sort
of reeling because I hadn't, I hadn't actually looked at
those numbers. I've always just assumed that even with the
housing price drop, that property was bloody expensive. But you're saying, well,
in terms of the percentage of income....
Speaker 2 (16:46):
It might be expensive compared to 2005 and 2010, but.
Speaker 1 (16:53):
What was it then?
Speaker 2 (16:54):
This is 2026. I can't give you the ratios from then,
I don't know.
Speaker 4 (17:00):
OK.
Speaker 1 (17:01):
What's your skin in the game?
Speaker 2 (17:03):
I'm retired.
Speaker 1 (17:05):
You've got too much time on your hands.
Speaker 4 (17:08):
No, I don't.
Speaker 2 (17:10):
I have been involved in a few industries. Can I
make a brief comment on something else that is related
to real estate?
Speaker 1 (17:15):
Yeah, away you go. Yeah, why not?
Speaker 2 (17:17):
Okay. Well, thank you. I listened to the comments previously
about the licensing requirements and the hour and a half
required for relicensing and compulsory professional development for Maori training
and education.
Speaker 1 (17:33):
Oh, no, let's not worry about that one. We're going
to stick with the property side of things, Neville. But
just quickly, can you just give me those numbers again
that you're aware of? Because the Google search I've done,
and it's a very quick one, is that the affordability
of houses in Auckland is 6.7 to 6.9 versus what
was 9.6 to 9.7 about three years ago. Is that
about right, what you understand for Auckland?
Speaker 2 (18:00):
The stat I was referring was a national statistic, not
a local one. Oh, good.
Speaker 1 (18:03):
No, that's great. Hey, good on you, mate. I appreciate
your call. Yeah, the other one's a little off the topic,
so we'll leave that one alone, but we do appreciate
your call. 0800 80 10 80. Actually, why... I mean,
maybe I'm just not reading enough, but, yeah, I mean,
it's taken a talkback call to point that out. To me,
(18:23):
I would have thought that was quite a big sort
of headline, that housing affordability has massively changed.
Speaker 3 (18:29):
Yeah, I think, I mean, you can see that in
the numbers of first-home buyers in the market, right? I
think it's, last check, it's 28% of the market was
first-home buyers, which is awesome. That's a real reflection that
it is a bit more of a buyer's market at
the moment, and first-home buyers are seeing that opportunity to
get in. Investors, obviously, are sitting on their hands until
later this year, see what happens. But the first-home buyers
(18:51):
being in the market is a good sign, and I
do think that banks capping how much, or being capped
on how much they can lend to owner occupiers to
six times income is reflective in those numbers as well.
Speaker 1 (19:03):
Gosh. Yeah. Okay. Let's take some more calls. 0800 80 1080.
Your reckons on what the change in the cash rate means,
because there's another thing that's come up in the conversation,
which to me is the elephant in the room. And
Peter's just mentioned, we've got an election. And if you
were an investor, look, I'm not an investor, but if
I was thinking of doing it, I wouldn't be have
(19:25):
a snowball's chance in hell of doing anything right now
because I don't know what the government's going to be
like in a few months. That's a massive uncertainty for participation,
isn't it?
Speaker 3 (19:33):
Yeah, absolutely. I mean, just to give an example there,
we had a client the other day who said they
want to put a property under contracts just before the
election into due diligence during the election, but not confirm
unless they know what has happened with the election. So
depending on which way that goes, they'll confirm or not confirm,
which is a real sign of thinking.
Speaker 1 (19:52):
Does due diligence give them regal room if there's a
change in government?
Speaker 3 (19:56):
Yeah, because they're not unconditional at that point, right? So
they're just entering.
Speaker 1 (19:59):
What's due diligence? Is that just like until I change
my mind?
Speaker 3 (20:03):
Yeah, it's just a period of time. It's generally 10
to 15 days between the time when they say, yep,
I want to put that property on hold and yep,
I want to confirm and pay a deposit.
Speaker 1 (20:12):
Wow. That's quite the out, isn't it? Well, yeah, absolutely.
Speaker 3 (20:15):
But it's normal if you put a property under contract,
there's some time, you want to make sure you can
get finance, you might want to get a builder's report. Yeah.
Speaker 1 (20:21):
I bet when I was studying law, there was the
out which you'd say it's subject to purchaser solicitor's approval,
and it's been realised that actually that's just an out,
total out.
Speaker 3 (20:31):
Yeah, absolutely.
Speaker 1 (20:32):
So this sounds like the new easy out.
Speaker 3 (20:33):
Yeah, absolutely.
Speaker 1 (20:34):
Okay. We'll be back in... Actually, no, we're going to
be back in just a moment. We're going to take
a call from Kelvin. G'day.
Speaker 4 (20:40):
Good afternoon, Tim. Good afternoon to your guests. Mortgage rates
don't affect me because I don't borrow money. I lend money.
But what I wanted to find out is that I
hear more often than not people being concerned with the
price of houses going down. But I can never understand
what there's any concern about because if you're going to
(21:02):
sell your house and get a lower price than you
would have last month as such, the next house you're
buying must have gone down in price. So everything more
or less balances out.
Speaker 1 (21:13):
Well, if you're buying and selling in the same market,
that's known as, yeah. I mean, Peter, comments?
Speaker 3 (21:20):
Yeah. I mean, yeah. I mean, if you sell for
less than what you bought for, then that's when you
realize your loss, right? So our view of that is
to hold. And at the end of the day, if
you own an asset and it's gone down in value,
then at least you own the asset and you can
hold on through that. But yeah, I mean, there is
that argument that you're buying and selling in the same market,
but not everyone's selling in order to buy.
Speaker 1 (21:40):
Is there a bit of an emotional block there that
people just don't like to sell even though they're going
to be– I mean, if you're buying and selling in
the same market and you need to move, then you
just do it anyway, don't you? I don't know.
Speaker 3 (21:52):
Well, if you need to do it, if there's a
real need there, then it's irrespective of what the market's doing.
But I would– yeah, I mean, not everyone is selling
in order to buy.
Speaker 4 (22:01):
But surely most people would be– if they're selling their house,
most people would be buying again on that same market.
They wouldn't be waiting six months or a year or
anything to buy another house, surely.
Speaker 3 (22:14):
It depends on if they're owner-occupiers or if they're relocating.
I would have thought if you're a lender, mortgage rates
would very much affect you.
Speaker 5 (22:21):
Yes.
Speaker 1 (22:22):
Are you talking about lending someone $ 100 or are you
talking about lending someone a couple of hundred thousand, Kelvin?
Speaker 4 (22:28):
Yes, the latter.
Speaker 1 (22:30):
Oh, the latter. Oh. Yeah, the latter, yeah. So do
I come to you if I need a loan? How
do you end up loaning if you've just got money to,
you know.
Speaker 4 (22:40):
Well, a lot of it's to do with not spending it,
isn't it? That's how you accumulate money.
Speaker 1 (22:45):
But who's borrowing money from you?
Speaker 4 (22:47):
Well, the banks borrow money.
Speaker 1 (22:48):
Oh, you mean you deposit it in the bank and
you call it lending?
Speaker 4 (22:52):
Yeah, the banks are borrowing money all the time, aren't they?
Speaker 1 (22:54):
Okay, so you're just talking about when you stick your
money in the bank, you are lending it to the bank.
Is that the way you're talking about it?
Speaker 4 (23:01):
Yeah, yeah. Depending on what the amounts are, of course.
Speaker 1 (23:05):
Yes, okay. And what are they giving you for your money?
Speaker 4 (23:09):
Well, at the moment, I think it's under 5%, so
that part of it doesn't really matter.
Speaker 1 (23:14):
Well, it does matter. Surely it matters to you, doesn't it?
Doesn't it matter to you?
Speaker 4 (23:19):
No, it doesn't make any difference to my life. The
reality is it's only to do with if you've possibly
over-mortgaged yourself. You're borrowing a large amount and then interest
rates go up or down or whatever. Yeah. No, life
just goes on the same.
Speaker 1 (23:36):
You're just fairly sanguine about it. You're pretty relaxed about
these things. It's life. What goes up must come down.
I've got this.
Speaker 2 (23:42):
Oh, yeah.
Speaker 4 (23:42):
I'm extremely relaxed.
Speaker 1 (23:44):
Yeah. Well, that's a good. Lucky old you in that respect. Yep.
Good on you, Kelvin.
Speaker 4 (23:49):
Anyway, that's all the best. Thank you.
Speaker 1 (23:51):
Thanks, mate. I'm not sure what to make of that
from Kelvin. Thoughts, Peter?
Speaker 3 (23:57):
I thought he said he was a lender in so
much case mortgage rates absolutely affect him. But, of course,
if he's an investor as well, then it.
Speaker 1 (24:02):
He's being semantically, instead of depositing his money in the bank,
he's saying that's his money and the bank is borrowing it,
which is not the way that you or I were
thinking of lending. But I know Kelvin from other talkback calls,
and I realize he's just being creative with the way
you can think about these things. Technically, I guess if
(24:23):
you let the bank have your money and they pay
you interest for it, perhaps they are borrowing it.
Speaker 3 (24:27):
Yeah, and he's in a good position to not have
to care what they're paying him.
Speaker 1 (24:30):
And he doesn't need to have a mortgage document because
you can just tell the bank he wants it back. Okay, yeah. Okay.
Let's go– actually, I'll tell you what. Let's take some–
let's go to some texts, I think. Somebody said, due diligence.
It gives the purchaser time to research any underlying problems
that may have been overlooked. It's not just in case
(24:51):
the purchaser changes their mind or time to imply– or
time to apply for a loan, not every person has
to borrow to purchase a property. Yeah, that due diligence
is an interesting one. So you've got a client who's,
they're going to put an offer in and then have
due diligence period. Is there a restriction what they can
(25:15):
justifiably say, look, I've done my due diligence? Do they
have to have particular grounds to get out of it?
Speaker 3 (25:21):
Not for our clients. Our clients have within their contract
basically a get out for whatever reason, you can wake
up on the wrong side of the bed and decide
I'm done and exit. That's within our clients' contracts.
Speaker 1 (25:32):
So what sort of sellers are happy with that? Just
happy to get a buyer, are they?
Speaker 3 (25:36):
Yes, it's developers, so we're selling. Our clients are investing
in new build. Oh, okay.
Speaker 1 (25:43):
It's a bit more complex than that. It's not just
I want to buy your house and I'm going to
do due diligence and now it's a Labour government, I'm out.
Speaker 3 (25:49):
No, no, no, not quite. But the text is right.
I mean, there's different due diligence that can be done
on a property. Some people don't need finance. Some people
don't care if they want a building report or not,
and some people do. But during that time, you can
negotiate what due diligence you want.
Speaker 1 (26:03):
Okay. Hey, how many people are actually getting the building examined?
I'm not thinking developers now, but just when it comes
to buying a property, how many people are getting a
builder's inspection or a vendors supplying those because they're extra
keen to sell it?
Speaker 3 (26:20):
Good question. I think that would depend on the agent
and depend on the deal. All of our clients are
buying new builds.
Speaker 1 (26:26):
Yeah.
Speaker 3 (26:27):
So they'll have certain things that they'll have included in
their contracts. We don't see too much of.
Speaker 1 (26:31):
That in our market. That's your particular area. Yeah, right. Okay. Look,
0800 80 1080 is the number with Peter Norris. He's
Managing Director at OPS Mortgages. And, well, we're having a
general chat about the OCR, what it means for the market.
Is it going to make a big difference to it?
Or I'm getting the sense it's going to make... What's
the technical expression? Bugger all difference. That'd be my conclusion
(26:53):
so far. You can tell me if I'm wrong. 0800
8010 80P to count after the break. It's 24 minutes
to five. Newstalk ZB. I'm Tim Beveridge. We're with Peter Norris.
He's Managing Director. Oh, just dropped my mouse. Hang on. Sorry. Oh, God.
Now it's all gone. I can't even click on a
call if I need to.
Speaker 5 (27:06):
Hold it.
Speaker 1 (27:07):
Hold it.
Speaker 5 (27:08):
Sorry.
Speaker 1 (27:09):
Just dropped the mouse on the floor and we'll just
fix it.
Speaker 3 (27:12):
Sorry.
Speaker 1 (27:15):
Yeah, I think that's working. Let's see.
Speaker 4 (27:17):
Yes, it is.
Speaker 6 (27:18):
Hurrah.
Speaker 1 (27:18):
It means we can say hello to... That would have
been difficult, wouldn't it? If I broke a mouse in
the studio... Anyway, fun times at Newstalk ZB. My guest
is Peter Norris. We're talking about the cash rate, the
effect on the market, where we're going. And actually, I
started the show, by the way, if you've just joined us,
I started the show saying, well, it's not going backwards.
So surely there'd be some momentum to get in and
(27:40):
get cracking. But It's not actually going up much further,
so maybe I'm full of it. So let's see what
you reckon. Oh, 880, 1080. Simon, hello.
Speaker 4 (27:50):
Yo.
Speaker 5 (27:52):
Yeah, how's it going?
Speaker 3 (27:53):
Good, thanks.
Speaker 1 (27:53):
What's up?
Speaker 5 (27:54):
Very well. So I, at the moment, have just gone
down to my yard to unload a load of furniture
because I am under due diligence at the moment in
purchasing a first home. And I was completely new to
all of this. You know, I've been in New Zealand
for 20 years, worked hard all my life.
Speaker 4 (28:13):
Yeah.
Speaker 5 (28:14):
Um, and yeah, Jujula Dinch is awesome. It gives you
a chance to do things like get a building inspector
and to check out the things. I'm a builder. And
even the things that he saw, I didn't see.
Speaker 1 (28:25):
What did he say?
Speaker 5 (28:25):
Um, uh, all sorts, cracked roof tiles, asbestos fence, um, uh,
maybe a leak problem because there was new carpets, um,
all sorts of things, a little bit of rot under here,
a little bit of rot under there. Are you still
going ahead with it? Yeah, yeah, yeah, definitely. Great time
to buy at the moment. I lived in Auckland, as
(28:47):
I say, for 20 years. Lived in Matakana 20 years
ago when it was a farming town. Now look at
that place. Just buying in South Auckland. South Auckland, when
I moved here, was like, oh my gosh, once more warriors.
But not anymore. Everything's changed. Everything.
Speaker 1 (29:02):
That's nice. You know what, that's actually nice.
Speaker 5 (29:04):
My wife's from South America. You know, it's great in
this country. Love it. Wouldn't change it for the world, mate.
Speaker 1 (29:09):
That is so nice to hear, Simon, because we have
so much doom and gloom, isn't it? Good on you.
Speaker 5 (29:14):
My friend, my friend, I've got a 14 month, I'm
41 years old. I've got a 14 month old daughter.
My wife is just a little bit younger than me.
And we've got another one on the way, a little
boy in November, just about to be first home buyers.
We go unconditional on Tuesday and then the real fun begins.
Speaker 1 (29:33):
Wow.
Speaker 5 (29:33):
But yeah, it's a great time to buy. Just look
around people. Don't give up. Anyone can do it. If
I can do it, anyone can do it.
Speaker 1 (29:41):
Don't go anywhere. Hang on, Simon. Peter, you were sort
of nodding along. as well. What do you reckon?
Speaker 3 (29:46):
I was just thinking that. You've got all the positive
callers coming in today. It's great putting a positive spin
on what's going on. I think it's awesome. It's good
to hear. And great work in your first home.
Speaker 5 (29:53):
If I had longer to talk to you, I've been
doing building over here. I'm born to be a builder.
And I've never seen it this quiet in the last
couple of months. A lot of my friends have been
quiet in the last couple of years of work. A
lot of immigration coming in, a lot of builders, but
the difference is there's a lot of builders, but there's
too many wheelbarrow pushers, not enough skilled builders. So we're
(30:18):
still good.
Speaker 3 (30:19):
Are you doing new build houses or renovations?
Speaker 5 (30:22):
I do everything, everything, everything, yeah. So I'm a stonemason
by trade, so I used to build your castles and
your stone walls. Now I'm foundations. dig big holes, fill
them with concrete. I do KO housing, or as they
call it, sorry, TRC, Potamica Regeneration Corporation. I do a
lot of those. We do private builds.
Speaker 1 (30:42):
Yeah.
Speaker 5 (30:42):
We're starting to get back into the 150, 170 plus slabs.
Speaker 1 (30:48):
Yeah.
Speaker 5 (30:48):
So people are starting to now buy again. You know,
it was a bit worrying, but house prices are definitely alive.
Speaker 1 (30:55):
Hey, can I ask, you know, you talked about you
were in Matakana back when it was a rural community.
Now it's, you know, Matakana. Do you still own something there,
or did you sell out before it became.
Speaker 4 (31:05):
No, I've never owned. I've never owned.
Speaker 1 (31:07):
Oh, I've never... I swear I missed that bit.
Speaker 5 (31:09):
First-time buyer. No, I've earned silly amounts of money.
Speaker 1 (31:14):
So whereabouts have you bought?
Speaker 5 (31:18):
In Papatoe.
Speaker 1 (31:20):
Okay.
Speaker 5 (31:20):
So just off Great South Road. It's a nice little place.
It's one of two dwellings, so it's a split lease.
Speaker 1 (31:28):
Yeah.
Speaker 5 (31:29):
It's at the end. I have the wraparound garden, 400
square land, 100 square house. The garage is a step down,
and it's a third of the house, so I'm going
to change it into a double bedding. I can put
an extension on it that doubles the footprint. You just
turn it from $ 650, 000 to a mil.
Speaker 1 (31:48):
So do you think you're going to live in it,
do it up, and then sell it sort of thing,
like an investor who's living in his own house?
Speaker 2 (31:56):
So.
Speaker 5 (31:57):
As I said, 14-month-old daughter, one on the way, 40
years old.
Speaker 4 (32:01):
Buying a house.
Speaker 1 (32:02):
Mate, you're not going anywhere.
Speaker 5 (32:03):
Mate, I'm happy.
Speaker 1 (32:08):
It's nice to hear that. Can I ask one more question? What,
under due diligence, would you have decided not too much?
Speaker 5 (32:17):
Oh, you see.
Speaker 1 (32:19):
Or is it just thinking time?
Speaker 4 (32:20):
Three weeks ago, we looked at the house.
Speaker 5 (32:22):
Three weeks ago, we looked at the house. It's the
first house we looked at. They say you shouldn't get
the first one that you look at, but this thing
was too good to be true. Before you know it,
the bloody lawyers are involved and the real estate agent.
And then it's like, right, do this, do that, do that.
It goes so fast. Too diligent. You have to be careful.
(32:42):
I noticed earlier on, you said 10 to 15 days.
You have to say working days.
Speaker 2 (32:47):
Yeah, it's a good point.
Speaker 5 (32:48):
Don't get caught out on that.
Speaker 1 (32:51):
Good on you. It's just nice to hear your positivity.
And funny enough, we had an asbestos fence on the
flat that we bought our unit from the landlord. But
the one thing we removed, it turned out to be
an asbestos fence.
Speaker 5 (33:07):
Um but hey i've um i've got to relieve one
of those soon so if you want to buy another
one mate no.
Speaker 1 (33:12):
Mate no no we've we've we replaced ours we replaced
ours with a bit of to do but um yeah
good on you.
Speaker 5 (33:20):
Mate take care excellent great chat be safe take care.
Speaker 1 (33:23):
Bye i haven't heard of that i mean look he's
just going an exciting time in his life child on
the way you know.
Speaker 3 (33:30):
Well to be fair he's one of the he's one
of the first time buyers that i mentioned earlier right
they're they're very much in the market at the moment.
It's a great time to be a first-home buyer.
Speaker 1 (33:36):
What's the... I mean, when you are talking to your
clients on this, I mean, your first-home buyers that you're
dealing with, they're buying into developments, are they?
Speaker 3 (33:45):
Yeah, to be fair, we don't deal with first-home buyers
really at all, a little bit on the mortgage side,
but not so much, definitely not on the property side.
Speaker 1 (33:51):
Okay, yeah. Sorry, I got my wires crossed on that.
Let's have a look at a couple of texts before
we're going to move on and we're going to go to...
The one roof property of the week, actually, is a house...
Quite a unique house, which we'll get onto in a moment.
But I have actually stayed there. So I sort of
know a bit more about the house than just, you know,
(34:12):
the description that's in the real. In fact, I'm looking
forward to going through the photos and seeing how different
it is from when I was staying there on the
shores of Lake Rotorua. So, but we'll do that in
a moment. Let's have a look at a few texts.
As a, here we go. Tim, we just had 30
groups to our open home. Many are first-time buyers. We're upsizing,
and it turns out to be a great time to
(34:32):
do it. Sad for the few who are in negative equity,
but overall lower house prices are great for people in
the economy. Actually, the negative equity situation, that's a tricky one.
It sucks that you bought and you've got negative equity,
but if you're buying to move, I guess you'd make an...
(34:54):
How would you deal with someone who's got negative equity
as a lender?
Speaker 3 (34:57):
Wow. So as a lender, there's really nothing that actually happens, right?
So negative equity is bad when you're selling. First off,
it's great that you've got the asset to begin with.
Speaker 1 (35:07):
Yeah.
Speaker 3 (35:08):
And as long as you're able to hold while interest
rates increase, then over time, our view is that long term,
you'll do all right. If you bought three years ago,
then you're probably not doing all right. And you may
be in that negative equity space. But banks aren't going
to call in loans. They don't go and check LVRs
and just start calling in loans because property values have dropped.
Speaker 1 (35:26):
No.
Speaker 5 (35:26):
No.
Speaker 1 (35:26):
So does it mean that– what's the process when it
comes to you've got to sell and buy? How does
that work if you want to move? Are you stuffed or– Well.
Speaker 3 (35:34):
If you're downsizing, if you're going into a position where
you're selling and you're selling for less than what you owe,
then that's obviously not a good position because you still
owe that money.
Speaker 1 (35:43):
So that's just not going to work. So you just
can't take that borrowing and go and buy a new house.
So it is problematic.
Speaker 3 (35:48):
Yeah, that's problematic. And that person's space, when you're upgrading
at the moment, yeah, it's a great time because you're selling–
buying in the low market as.
Speaker 1 (35:57):
Well okay um another comment here it says as an
old fart with term deposits i hope interest rates go
to about eight or ten percent as they used to
be however i've got a well however i've got a
daughter granddaughter and grandkids in welly who own a house
each that have devalued markedly they desperately want to sell
and go back to live in canada poor buggers are
(36:17):
going to take an articaning um it doesn't sound like
he really wants interest rates to go up there i
mean it If you care about your family.
Speaker 3 (36:25):
Feedback off back to Canada, then what does it impact him, right?
It'll take his 8%. But no, I don't think that's
quite the right way to look at it.
Speaker 1 (36:34):
No, no, indeed. Anyway, look, we're going to come back
with the one roof property of the week in just
a moment. And a little teaser, it belongs to the
owners of one of New Zealand's iconic housing styles slash brand,
And we'll be back with that in just a moment.
(36:55):
And it's in my old neck of the woods in Rotorua,
known as Kawaha Point. I have no idea if you're
supposed to pronounce it Kawaha Point or Kawaha Point, because
we just call it Kawaha Point. So apologies if my
pronunciation is wrong, but I said it for decades. So
there we go. We'll be back in just a moment.
It is 10 and a half minutes to five. The
(37:17):
One Ruth Property of the Week on The Weekend Collective. Yes,
welcome back. The One Roof Property of the Week is,
I'll give you the address, and if you are near,
you know, not when you're driving, of course, don't search
for it. It is 22 Parra, T-U-P-A-R-A, Crescent, Kawaha Point, Rotorua. Now,
it is the house of Joe LeGrew, Joanne and Joe LeGrew,
(37:40):
who are, well, they're the, he's the king of Lockwood,
the Lockwood buildings. And as the article says, what does
the king of Lockwood build for himself? You've got it.
It's an all-wood house. Lockwood on steroids, chateau overlooking the
waters of Lake Rotorua. Now, Joe and Joanne are great
supporters of the arts and through endeavours. I used to
(38:02):
live in Kaua Point when I'd visit Rotorua. I've stayed
with them on a few occasions in this house. And
it's a giant Lockwood. I don't know how to describe it.
The setting is magnificent. The view in from the driveway,
it's 600 odd square metres of Lockwood. What do you reckon, Peter?
Speaker 3 (38:21):
I think the article sums it up beautifully. Lockwood on steroids.
I think it's exactly one of those. Everywhere you look,
it's Lockwood.
Speaker 5 (38:27):
Yes.
Speaker 1 (38:27):
I mean, so he is the owner of Lockwood Homes. Basically,
they designed this architectural legacy. It was designed to stand
the test of time. It's a tricky one to value
because Lockwood is Lockwood, and it really is in the
traditional style in terms of the color of the timber
and everything. I don't know how you'd value it because
even the article and the listing are have a couple
(38:49):
of different sort of values on it. What did you think?
Speaker 3 (38:51):
Yeah, there's a couple of million dollars difference between what
the listing or what OneRoof suggests it could be worth
versus what the article says there's a valuation at.
Speaker 1 (38:58):
Well, it said there's a, this is interesting. It says
that the registered valuation reached 4.58 million, but the rating
valuation is 2.93 million.
Speaker 3 (39:15):
Yeah, so the registered valuation is a proper value of
going to the site and saying this is what it's worth.
So that's what the agents said in the article.
Speaker 1 (39:23):
So it's an interesting one. I wonder who would buy
it because the look inside, what you you almost could
do you'd do nothing with it wouldn't you but it's
it is of an era.
Speaker 3 (39:34):
Yeah absolutely I think you either love it and do
absolutely nothing to it or possibly you hate it and
you do a lot to it right I think that's
really your two options you wouldn't do a bits and
pieces reno to.
Speaker 6 (39:45):
That property right there's no ambivalence involved with it actually
that probably sums up Lockwoods in a way um I reckon,
here's the other thing.
Speaker 1 (39:55):
I mean, it's such a distinctive residence. You could almost
imagine someone taking it over and turning it into a
bit of a B & B sort of thing, you know,
turning it into a guest house. They've got the driveway.
They've got the, I don't know.
Speaker 3 (40:07):
Yeah, I mean, it's quite stunning, really. It's a beautiful location.
It's got some jetty right on the lake.
Speaker 1 (40:12):
Yeah, and it's got the big, I mean, the big
stone fireplace. As I say, it's what we go back
40 years. What are we at? The sort of, oh,
the 80s. Oh. It's funny. It sort of feels a
bit more of a 75.
Speaker 3 (40:25):
Doesn't seem like that far ago, right?
Speaker 1 (40:26):
Yeah, there you go.
Speaker 3 (40:27):
I mean, that house is 600 square metres. That's bigger
than the last caller's lamb that he's just bought.
Speaker 1 (40:31):
Yeah. No, it is fantastic property, and it's totally unique
as well. So do go and check it out. I'll
mention that address again. It was, oh, easy to find
a one roof, but just your 20 Tupara, T-U-P-A-R-A, forgiveness
on the pronunciation, Kawaha Point in Rotorua. And you can
go and check that out. And, hey, Peter, great to
(40:52):
see you, mate.
Speaker 3 (40:53):
Thanks for having me. Yeah, good stuff.
Speaker 1 (40:54):
And thanks for everyone for your participation. We will be
back next with the parent squad. We've got the principal,
the headmaster. Gosh, headmaster sounds sterner, doesn't it? The headmaster
of Auckland Grammar is with us, Tim O'Connor. We're going
to talk about, among other things, just, you know, the
relationship between school and parents and how to manage that
as your children get a little bit older, as the
(41:16):
years go by. We'll be back shortly. This is the
Weekend Collective News Talk ZB, three minutes to five. For
more from the Weekend Collective, listen live to News Talk
ZB weekends from 3 p.m. or follow the podcast on iHeartRadio.
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