People are panic buying homes as prices skyrocket around the world
John Kenel
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"From New Zealand to the United States, Germany, China and Peru, the same phenomenon has taken hold: home prices are skyrocketing, and many buyers are panicking".
The rapid rise in house prices in NZ of late is mostly due to low interest rates and massive money supply growth. Interest rates have been reduced to all time lows at the same time as $100 billion of new money has been poured into the system. This extra money, together with super low interest rates fuels higher house prices.
The government can blame property investors and speculators as much as they want, it doesn't change the fact that they, the government, are the ones stoking the fire and they have no plans to change that. They want to keep rates low and spend, spend, spend.
Expect house price rises to slow a little for the next few months while home buyers digest the slew of rushed legislation, then they’ll rise again, if for no other reason the cost of building new homes is going up at a rapid rate.
Prices rises are coming across my desk almost every day. Building materials costs, delays in supply of products putting construction on hold, councils causing hold ups as they are behind due to increased consent volume and a lack of staff, wage rises, increased staff costs (more holidays, sick days, minimum wage etc). It’s all putting huge pressure on building costs and I expect some builders get caught in a margin squeeze.
More tax on the haves will not create affordable housing for the have nots. The gate for affordable housing in NZ closed years ago. The RMA, the council consenting processes, the continually increasing building standards coming out of central government, the increasing time frames to consent and build. The cost of housing in NZ is rising and will continue to rise. Nothing government is doing now will lower the cost to build a new home.
John Kenel - CEO, Assured Property
#assuredproperty #housing #rentals #propertyinvestment
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