Steve Jurkovich: Kiwibank CEO on the State of Home Ownership Index

A view more New Zealanders are adapting to get on the property ladder to overcome economic woes. 

Kiwibank's Annual State of Home Ownership Index finds 57% of non-owners feel locked out of the market, improving by 6%. 

It notes 60% still find the cost of living the biggest obstacle to owning a house. 

Chief Executive Steve Jurkovich told Mike Hosking more people are open to exploring different pathways to ownership. 

For example, he says, people are exploring co-owning, getting together with their parents and grandparents to try buy a house.  

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Episode Transcript

Speaker 1 (00:00):
Just a reminder this morning of the role that housing
plays in the key we psyche Qwebank State of Home
Ownership report shows eighty five percent of say owning a
home remains a key goal. Forty three percent believe it's
now more achievable, which is up seven percent, which is good.
Stability and security are your big drivers. Eighty eight percent
wanting the independence of their own space. Steve Yukovic is
the Qewi Bank CEO and he's with us. Steve, morning

(00:21):
to you on morning. It has always been that way
and it always will be. Is that a fair statement
to make we love houses?

Speaker 2 (00:27):
I think yeah, I think it is. It's at the
heart of what people feel about security and how they
feel like they can get ahead and the people.

Speaker 1 (00:34):
What about attitude to debt? To people's attitude to debt change?
For example, were borrowing more? Are we more bullish about
the market at the moment or not?

Speaker 2 (00:42):
I think the big change is how much people are
feeling about what they can do to repay debt as
quickly as they can, which makes a lot of sense
and is a great decision. So lots of customers in
the survey said, you know, when they get the option
they want to pay it down fast. Are they're thinking
about shortening up the term of their loan, thinking about
how they borrow different least, So there's definitely been a
big change around how people feel about borrowing. It used

(01:05):
to be pretty set and forget that's no longer the case.

Speaker 1 (01:07):
Yeah, are you going to view on a fifty year mortgage?

Speaker 2 (01:11):
Yeah? I mean that's that feels like a pretty wild idea.
I honestly don't think that in New Zealand. The market's
deep enough to work out how you would price that.
But you know, the advice I got when I first
bought a home from a very experienced guy was, you know,
pick the shortest team you can and pay it off
as fast as you can. So I still think that
makes sense.

Speaker 1 (01:29):
Yeah, what a most people do initially? Do they go
twenty five to thirty?

Speaker 2 (01:34):
Yeah? They do. Yeah, the default is pretty much twenty years.
A lot of people do twenty five. There is the
option to do thirty, but very few people take that. Right.

Speaker 1 (01:42):
The number in your work that worries me, the forty
three percent of nine owners who think they'll never own.
How real is that versus just it's psychological?

Speaker 2 (01:52):
I think it's pretty rareal. I mean getting together. You know,
one hundred and fifty two hundred thousand dollars is a
deposit with the current cost of living headwinds as a real,
real battle. I think that numbers always been pretty consistent
about how hard it is to get that money together.
So I think that's real.

Speaker 1 (02:10):
So how do we juxtapose what we know is real
the forty three percent who feel they're locked out versus
the twenty seven percent is who are first home buyers
who clearly aren't locked out and they can buy a
house and they're the major players in the market.

Speaker 2 (02:24):
Look, I really, deep down believe that if you know,
whatever you believe is true. So you know, if you
think you can get there and you can save the money,
then that's true. If you think it's too hard, that's
true as well. I mean a lot of people thinking
differently about how they would buy a house might so
I think, you know, it makes total sense. You know,
many cultures pacifica Madi, many Asian countries. You know, generations

(02:47):
living together in the same house is very normal. So
if you think about getting together with your parents and
your grandparents to try and buy a house, and then
you've got different leavers, and so I think as New
Zealand's you know, face and shape chain, you'll see people
buying houses in different ways.

Speaker 1 (03:03):
How big is the bank of mum and Dad now
at the moment?

Speaker 2 (03:06):
Oh? Still huge. I mean a massive amount of money
is supported for the kids getting up on that first
step on the ladder. And I'd probably say thirty to
forty percent of people get supports somehow from a bar
of family or fun.

Speaker 1 (03:18):
Now, okay, I'm getting some mail. Help me out here.
Swap rates are problematic post Hawksby's announcement the other day
fixed rates are going up. Is there an issue here
or not?

Speaker 2 (03:30):
No? I think well, I mean we talked about it
the other day. I'm pretty convinced we're at the bottom.
And if you're at the bottom, then when you look ahead,
normally things are going up. And so market says that
rates are going up early next year. So March April May,
I think we might see a tickup.

Speaker 1 (03:45):
So now's your window to act if you want to
act without giving the financial advice to people is just said,
are we about to turn?

Speaker 2 (03:53):
So?

Speaker 1 (03:53):
In other words, right now is the sweet spot.

Speaker 2 (03:56):
When you look back ten years, this looks like very
close to the bottom. And if you think about what
the average rates over ten to fifteen years are, this
is lower than average. So you've got to say this
is close to the bottom.

Speaker 1 (04:06):
Good stuff to appreciate it as always Steve Yukovic the
Kiwi Bank. Yes, swap rates continuing to trade higher post
the monetary announcement. Two year rates are up thirty one
basis points. And the reason I'm telling you this swap
rate that it's the market going. Hawksby was too blunt.
Hawksby said it's over. The market might have priced in

(04:26):
one more cut in the new year. Because he was
so explicit on his way out. We don't need to
worry about that anymore. In fact, one of the pieces
of mail this morning said Hawksby sabotaged the recovery on
his way out the door. So we're thinking about For
more from the Mic Asking Breakfast, listen live to news talks.

Speaker 2 (04:44):
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