to Valu in Review for June 2005. This is a summary of news articles in the press over the last month.

Read, learn, enjoy ..

.. and happy investing!

 

New dwelling consents are down 22% in May on the previous year to 1,977 approvals. This included consents for 111 apartments (down from 10% of all approvals in May 2004 to 6% this year). The residential sector has been offset by the increase in the number of consents issued in the commercial sector which is up 38% on the same time last year.
 

The Real Estate Agents Institute believes a number of agents are being offered rewards such as cash, trips or loyalty rewards points for suggesting to buyers to use a particular lawyer, conveyancing firm or bank. The Institute has not banned the practice but has advised agents that they must declare their commission arrangements with service providers so that vendors are fully aware.
 

Research is about to be undertaken on properties built of monolithic cladding to ascertain if all homes clad with this material suffer from a prejudice against the cladding material by buyers irrespective of if the house is a dry house or a leaky house. Many houses clad with this material are in fact dry. However, initial research in Auckland for sales over a 3 year period indicates that those new houses clad with this material have not had the increase in prices that other houses have (monolithic clad houses were generally 5% - 12%, other Auckland residential values - 31%).
 

Despite predications by many, the median house sale price continues to increase. Of the Real Estate Institutes 11 regions nationwide, 9 had increases in their median price (Nelson/ Marlborough and Otago had a decrease). The nationwide median in May was $275,000 ($272, 000 in April). This is based on sales of 9,280. While sales volumes are lower, the price that buyers were prepared to pay has in general been increasing.
 

NZs houses prices were increasing amongst the fastest in the world. In the edition of the Economist magazine released at the end of June, NZ was placed 5th out of 20 countries. The magazine noted that never before have the increases in house prices risen so long and so fast. The magazine did note that NZs house price inflation had slowed significantly in the last year.
 

NZs largest online trader has launched a Property section and is now providing the ability for Real Estate Agents and private sellers to advertise their properties online for a nominal fee.
 

A large Rental Agency has advised it is seeing rents consistently dropping since the start of the year as an increasing number of rental properties become available and the number of tenant’s drops. This has seen the weekly average rent drop from $342 in April to $336 in May. The average weekly rental in 2004 was $333.
 

The Auckland regions Councils are starting to plan for the extra housing that will be needed by 2050. However, no one wants the extra housing in their neighbourhood and there are many conflicts. Many suburbs are already firing their first salvos to protect their area. The 1/4 acre block will be a thing of the past. Whatever happens it seem that Aucklanders will need to have a cultural change as the need for higher density housing increases. Many overseas cities have had to do it and have done it successfully.
 

A State Housing area in Hamilton East (Hayes Paddock) is under consideration by the Council to make it a protected zone as the Council considers areas of urban design and heritage significance.
 

There were 907 respondents to a survey conducted by the city council on growth options.
54% wanted growth in urban areas
40% suggested grow out to undeveloped area’s.
6% said to do nothing.

If housing had to spread the respondents suggest Ngawhatu and Atawhai to Todds Valley first.