Auckland property market ready to boil over
Wed, 05 Dec 2012 6:35p.m.
By Tony Field
An already hot Auckland property market seems to be boiling over.
The city's biggest real estate company says its average selling price has hit a new record, and tomorrow the Reserve Bank will be making a statement.
The average price for a home sold by Barfoot & Thompson last month was $627,000.
“The high price, the million-dollar properties, we had 146 sales over a million dollars which is quite phenomenal at the current time,” says Peter Thompson of Barfoot & Thompson.
Prices had been subdued in most of the rest of the country, but that appears to be changing.
“Over the last few months you have seen a distinct pickup in the number of house sales outside of Auckland,” says Westpac’s chief economist Dominic Stephens. “I think that's an indicator that in the near future house prices will start rising a little more rapidly in areas of New Zealand outside of Auckland.”
The housing market is one of the factors the Reserve Bank is pondering as it considers whether to move the official cash rate (OCR) tomorrow.
Most economists predict new Reserve Bank governor Graeme Wheeler will keep the OCR at 2.5 percent - but if he does make a move, it's thought he'll cut rates.
Exporters hope such a cut would lead to a lower dollar, but there are no guarantees. Australia cut its official cash rate to 3 percent yesterday - and their dollar went up.
“The market was so geared up for a rate cut that everyone sold the Australian dollar ahead of the announcement and so when they actually did it, everyone bought the Australian dollar back and that resulted in the Australian dollar lifting higher again,” says Derek Rankin of Rankin Treasury.
So it looks like there is no easy way to lower house prices - or the dollar.
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21/12/2012 9:50:36 p.m.
House prices only go on based on speculation of equity gains. This is the problem with fiat money and if the world economu went back on a gold standard we wouldn't have this borrowing against assets such as houses based on a speculated equity gain to build/buy more properties.
21/12/2012 6:46:19 a.m.
taking flight wrote:
The real reason is that the global economy driven by ponzi scheme debt is flying in from off shore to nest anywhere it can BEFORE Joe public figures out that that nest is being filled with zombie vultures not golden swans, omg when duck season starts blood will drench the skys.
6/12/2012 10:16:33 a.m.
When you have unfettered overseas access to limited property, it a ever expanding bubble, property prices never crash here. I'l be saving 100k and fleeing to Thailand when I retire. If you stay here you retire you will be squeezed dry.
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