 | Welcome |
| | to Valu in Review for December 2004. This is a summary of news articles in the press over the last month. We hope you
Read, learn, enjoy ……
…… and happy investing!
We will be back in the New Year with a summary of news articles that are relevant to property.
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| Interest Rates. |
| | The Reserve Bank left the Official Cash Rate at 6.5% on 9 December. The Bank believes that there is still inflationary pressure in the economy so is warning that interest rates may not decrease as expected. Some economists now believe rates will not come down until the later half of next year It appears that the current battle of the 2-year interest rate between the major banks is over. The ASB, National Bank and BNZ Banks have increased their rates from below 7% to 7.6% - 7.7%. The BNZ signalled that it might offer another series of competitive rates next year. A survey conducted by KPMG on savings institutions has indicated that, due to the uncertainty of the housing market in the short term (will the market continue to be buoyant or will it stagnate?), some institutions will be more conservative in their lending practices.
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| Did they call it incorrectly? |
| | The latest figures from the REINZ indicate that the market has not collapsed or burst as some suggested. Only 3 of the 11 house regions did not experience a gain in their median house price in November compared to October.
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| And you think Auckland Apartments are expensive? Try US$44m! |
| | Rupert Murdoch has paid $44m (NZ $62m) for an apartment on 5th Avenue in New York. The apartment is spread over 3 floors (743 sqm). The apartment currently consists of 20 rooms but apparently needs to be refurbished before Murdoch can move in. The monthly maintenance bill is approximately $21,000.
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| Leaky Building – Owners claiming $19.2m. |
| | The claim comprises of $4.7m to demolish and rebuild 51 of the 153 Sacramento unit development in Botany Downs, Auckland. Another $6.6m is to re-clad the dwellings (including garages). The case is expected to go to the High Court next year and involves 20 Defendants.
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| Same Statistics. |
| | 1986 - 73% of people owned or had a mortgage
2004 - 67% of people own or have a mortgage
2011 - 62% of people are expected to own or have a mortgage. Since 1987 rents have increased 166% while wages have increased at less than half of that rate (59%). The rent in 2001 was approximately 17% of the take home pay. Building Research Association of New Zealand estimates that maintenance of a house is 0.5% to 2% of the house’s value.
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| Mortgage Brokers – Personal Disclosure Statement. |
| | From February next year all mortgage brokers who belong to the national association must provide the above to their clients. At a minimum the Statement will include the brokers qualifications, experience, the date they became a broker, how they get paid, and details of their professional indemnity insurance.
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We have tried to include a variety of articles and viewpoints on property recently contained in the media. Please note that the articles are a summary of the main points and we endeavour to reflect these as accurately as possible. The contents do not constitute professional advice and should not be relied upon as such. We strongly recommend that you seek professional advice at all times. The information is in no way a reflection of views held by Valuit Asset Appraisals Ltd or its staff.
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