Investor adds to rising housing market predictions
Veteran property investor Olly Newland is backing a prediction that the housing market will rise for another three years. The prediction was made by the chief economist of the BNZ on 3 News last night.
Mr Newland is sceptical about most ideas for reigning in the market, but he has some ideas for helping one group of buyers.
The Auckland property market has risen faster than anywhere else in the country, which is a problem if, like Shelley Wilkinson, you are trying to sell your house in Wellington to buy a home in Auckland.
“It just never quite got high enough for me to match what I wanted to buy up here,” says Ms Wilkinson.
It doesn't look like it is getting any easier for her, with the BNZ's chief economist, Tony Alexander, predicting prices could rise for another three years – a view backed by Mr Newland.
“Tony is absolutely correct,” says Mr Newland. “I have been saying the same things for the last couple of years. There is no reason why the prices shouldn't rise. We are all going up on the same tide.”
It's fours years, almost to the day, since a Barfoot and Thompson survey showed the first signs the Auckland market was rebounding after a 15-month slump.
Back then, Mr Newland told 3 News it was the start of the housing comeback. Now the New Zealand market is up 16 percent from its low four years ago.
“We have got more people coming into the country than leaving,” says Mr Newland. “We have got not enough building. We have got escalating costs for development.”
Mr Newland is sceptical about many of the ideas for lowering property prices to help buyers like Ms Wilkinson – for example, the suggestion there be restrictions on foreigners buying investment properties.
“It makes no difference who buys a property, whether it’s Asian or a man from Mars. When they pay out the money it's a Kiwi who gets it and he can go back into the market and compete with the same people.”
But he thinks there should be help for first-time buyers. He says that might include a special grant for first-time buyers purchasing a newly built house, or a rebate on their GST or a special, low interest rate.