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It is still possible to buy a new build starter home within commuting distance of Brisbane for mid $300k and there's no reason why a similar situation shouldn't exist in the 'burbs of NZ's major cities. Aroha Spashett was National's poster girl for deprived suburbs, she could just as easily be the poster girl for promoting Gen-Y home ownership.
Perhaps it's time the government introduced some first time buyer assistance schemes and encouraged developers to build more low cost housing for Gen-Ys? It's worked well over here and I think it will translate across the ditch.
Quote:
Credit reporting bureau Veda is warning that a new generation of young people, dubbed ''property orphans'', may be destined to be renters for life.
New information from the Australasian analytics company suggests Generation Y, defined as those aged under 28, have rapidly declining prospects of owning a home.
It has found that younger New Zealanders are applying for fewer mortgages, and instead borrowing up a storm on the likes of personal loans and credit cards.
You cannot build a half decent 300K house within commuting distance of Brisbane that's a load of garbage, Australia's housing bubble is equally out of control.
The average cookie cutter 4 bed 2 bath is between Au$450-550K in the new bris outer suburbs, and Bris is a cheap Capital city compared to Sydney or Melbourne. The cost of building is roughly the same per M2 in both countries .
The LVR change is a brave move by the NZRB, one of the few reserve banks to actually do something about the housing bubble and all evidence shows its slowing price growth, it will ultimately help first time buyers.
This has been discussed in multiple threads as you well know.
If anyone is interested in this subject, the Australian HASI (Housing Affordability Sentiment Index) 2014 showed that 53% of Gen Y are property owners, an increase of 5% from 2013 and 23% of them own investment properties. I've even seen them described as "the new property moguls." Also, affordable housing is selling like hotcakes, developers are pushing to get the land out as they can't sell it fast enough at the moment.
This is one example
Quote:
A BILLION dollar plus infrastructure program, new retail developments and a growing population has sparked a boom in demand for residential subdivisions north of Brisbane.
Millions of dollars in transactions have been completed in the Moreton Bay Regional Council area as developers snare land while investors and homeowners buy housing lots.
Colliers International's Brendan Hogan said he was involved in about $10 million worth of deals in Caboolture and nearer to Brisbane in North Lakes, Mango Hill and Griffin over the past six months.
"We're seeing renewed interest and real strength in the residential development site market at present," he said.
Quote:
Mr Hogan and colleague Pat George also sold a 3.6ha medium-density parcel at Griffin, a 3.9ha mixed-use residential parcel at Mango Hill, and a 2ha mixed-use site and 9.32ha residential development site both at Caboolture.
He said they were sold on behalf of a variety of vendors and attracted significant inquiry.
Add the recent Costco and the largest Bunnings in Australia, another Ikea store and the billion dollar Moreton Bay Rail Link and it's easy to see that there's massive growth to the north of Brisbane, plus the lifestyle attractions of the Sunshine Coast and Moreton Bay drawing people into the area. We were looking at buying some investment land down Caboolture and building one or two rentals, but are being told that it's cheaper to buy than rent right now so it's not a good time to be getting into rentals. Great news for Gen Y though , it looks like Moreton Bay Council area is the smart place to be for first time buyers right now and there's plenty to be had around the $300-350k price bracket. For example, There's a DJ Roberts Display home for sale on Central Lakes drive, 3 beds for $299,900
The LVR change is a brave move by the NZRB, one of the few reserve banks to actually do something about the housing bubble and all evidence shows its slowing price growth, it will ultimately help first time buyers.
Actually, the evidence is that it has made the top end of the market more affordable but the bottom end has become more unaffordable. Not really a surprising outcome when prices are being driven higher by a lack of supply but the government response is to reduce demand purchase power. NZ's NBL (non-bank lending) sector is tiny compared to Australia. It's around 10% of total Australian lending and it's usually the marginal borrower who goes to a NBL. Any change to bank lending will just push marginal customers to NBL's who are not regulated in the same way.
Actually, the evidence is that it has made the top end of the market more affordable but the bottom end has become more unaffordable. Not really a surprising outcome when prices are being driven higher by a lack of supply but the government response is to reduce demand purchase power. NZ's NBL (non-bank lending) sector is tiny compared to Australia. It's around 10% of total Australian lending and it's usually the marginal borrower who goes to a NBL. Any change to bank lending will just push marginal customers to NBL's who are not regulated in the same way.
Yes there's the problem straight off. It would be better for NZ to release more land and let the banks trade in a less restricted environment: a free market.
This is what Campbell's policy boils down to. Get land released in bucket loads and do it quickly enough to satisfy the developers, it creates jobs for builders/ tradespeople (something like 20% of owners on new developments are owner-builders) and generates wealth. Australian banks do their part too. They impose loan to valuation ratios but require customers to take out lenders mortgage insurance or pay a low deposit premium for loans of between 80% and 95% which is added to the loan so there's no upfront payment. It means that first time buyers are able to get on the property ladder with small deposits and copious land releases keeps prices down. I recall doing something like that years ago in England, otherwise we could have never afforded to get a deposit together. Then there's a whole load of government grants and first time buyer stamp duty concessions for first time owners building a home.
I think that's quite heartening for Australia's Gen Ys and it's definitely something that is being denied to their New Zealand counterparts, rather unfairly IMO. Hopefully the NZ government will see sense eventually. When the time comes for my children to buy their homes I'd like to know they're in with a decent chance regardless of where they end up.
Actually, the evidence is that it has made the top end of the market more affordable but the bottom end has become more unaffordable. Not really a surprising outcome when prices are being driven higher by a lack of supply but the government response is to reduce demand purchase power.
Depends on your context, for those that have very little deposit in the short term, sure it less affordable.
Allowing prices to run Rampant is far more damaging for first time buyers in the long run, the problem in Aus/NZ/Canada has never been short supply, I find it rather amusing people still believe this real estate industry myth, however the media of course get a lot of their revenue from banks and the Real Estate industry so we keep seeing blogs like this.
As for Caboolture, Samuel J have you actually been there? its 50K's North of Brisbane, "barely" commutable and lets just say not exactly a nice area unless you like living amongst a lot of welfare recipients, and leave it at that :P . If you go 50K South of even Auckland you can find 300-400K houses no problem.
Last edited by Battleneter; 09-23-2014 at 11:51 PM..
Reason: typo poor Canada
Depends on your context, for those that have very little deposit in the short term, sure it less affordable.
They're distorting the market and pushing people who have the capacity to take on higher value mortgages to overpay for cheaper housing. It's retarded logic because the 20% deposit will be eaten up when the value of the property falls when LVR's are normalised and buyers evaporate. As usual it will be FHB's who cop it. The sensible option is to use a higher theoretical interest rate when determining capacity to pay. The funny thing is it's the same cheer squad (those self righteous idiots over at Macrobusiness who probably have $100 between them) that wanted to do away with the first home owners grant who can't see how this is basically achieving the same outcome (ie fhb's overpaying for property).
They're distorting the market and pushing people who have the capacity to take on higher value mortgages to overpay for cheaper housing. It's retarded logic because the 20% deposit will be eaten up when the value of the property falls when LVR's are normalised and buyers evaporate. As usual it will be FHB's who cop it. The sensible option is to use a higher theoretical interest rate when determining capacity to pay. The funny thing is it's the same cheer squad (those self righteous idiots over at Macrobusiness who probably have $100 between them) that wanted to do away with the first home owners grant who can't see how this is basically achieving the same outcome (ie fhb's overpaying for property).
Your logic is horribly flawed, there has already been a drop off in sales sub 500K where FHB live and price growth is clearly slowing, Supply and demand 101, less demand will equal cheaper prices.
Its like people in this argument have utterly forgotten about US Sub Prime believing the "We are different" despite the evidence there is many similarities.
Gen Y and anyone else that cant afford a house is being protected from over leveraging as interest rates rise, the house market stagnating and ultimately negative equity with mortgages bigger than they need to be. Its extremely sensibly policy.
Foot note, I would have preferred negative gearing tax credits to be rolled back at the same time.
Bearing in mind the aim of this forum is to actually provide data about cities I thought that it would be helpful to give some information about Moreton Bay and Caboolture / North Lakes.
If anyone is thinking about working in Brisbane or moving to SE Queensland it's the next *in place* and one of the fastest developing regions in Australia with one of the best climates. People generally prefer living near the coast not just for the lifestyle, but also for the cooler sea breezes in summer and warmer winters.
There's loads more out there that's just a sample.
Also you should be aware that many of the new developments north of Brisbane are now coming with fibre optic internet networks. But, it will be eons til that new fangled technology works its way out to us up in them thar hills (you pays yer money and you takes yer choice)
No wonder the Aussie media are having a spasm, the banks must be packing their trousers!
That was rather good timing for this thread Samual J , probably wouldn't have bothered posting it.
Last edited by Battleneter; 09-24-2014 at 02:40 AM..
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, it looks like Moreton Bay Council area is the smart place to be for first time buyers right now and there's plenty to be had around the $300-350k price bracket. For example, There's a DJ Roberts Display home for sale on Central Lakes drive, 3 beds for $299,900
