Don’t give up – work! The state of housing in New Zealand

There’s not much to say about the New Zealand housing market other than it’s unaffordable. New Zealand property is currently among the most unaffordable in the world. Period. Why? Well, that’s another story.

Here is the voice of the Property Investors Federation chief executive Andrew King. Confronted with one of the reasons why property get’s more and more expensive, which is speculation, he answered that he didn’t believe investors are pushing first-home buyers out of the market. His reasoning in the following. With comments.

“Only 7 percent of the population actually owns rental properties. The numbers have to work and at the moment it’s actually quite hard to make a rental property work.”

So, when Nick Godall, economist from CoreLogic, states that 24 percent of homes in New Zealand are owned by investors he means that 17 percent of them are living in their investment?

King said it was pressure from migration driving house prices.

That sounds familiar. There has been in fact a doubling number of immigrants in 2016 (from 32k to 72k). The houseprices however did not follow the peak, although trending up steadily.

It had always been hard to get on the property ladder – but for different reasons, he said.
He had to get a second job to afford the interest on his first home.

Interesting. No explanation though. King delivers at least a solution: Double Hard Work. I remember my grandfather in Germany after the war, working away and getting lucky to build and own his own house. It took fourty years to pay it off. After his return from the eastern front in 1949 (he left 1939), there was work waiting for him and a destroyed balance in his world view. Life can’t get much tougher. But does it need to be tough?

“It will mean hardship, there’s just no way around it. If you want to own your own property you have to forgo other things and you have to save a lot of your income in order to get that deposit.

Even if that means eating junk food, taking the push bike to work or freeze a bit in winter?

I cannot solve your problems, sir, only you can.

King’s advice to first home buyers is “don’t give up”.

Source: Radio NZ

Get rich or die tryin’

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