We pulled 6 gems from the torrent of property news this week to keep you abreast of the most important insights affecting investors. 2-8 November 2019
It’s been a quiet week and the torrent of news has contained a fair bit of drivel and pontification, but we found six gems that will keep you abreast of matters affecting property investors…
Term Deposit Rates Continue to Fall
In the last week we’ve seen three banks reduce their 12-month term deposit rates. There is now only one bank left offering the top rate of 2.7%. Full details on our ‘NZ Interest Rates Forecast’ page at the link below.
Sandra Has a Problem
The unintended consequences of Government proposals to remove 90-day notice terminations… great for feral tenants; terrible for Sandra and other victims.
Commercial Building Activity Slows
The total volume of building activity remains at historically high levels and the trend has been generally increasing for the past two years. But it fell 1.5% in the June 2019 quarter, driven by slowing non-residential construction activity.
“Although the value of building work put in place continued to grow this quarter, the volume of activity failed to keep up with previous seasonal increases, especially after a very strong March quarter,” Stats NZ construction statistics manager Melissa McKenzie said.
Retail and office space were the two most affected commercial categories.
Auckland Values Still Weaker than a Year Ago
Average dwelling values are continuing to rise across the country but at a much slower rate than previously. And Auckland still lags the rest of the country with the average dwelling value down 1.5% compared to October last year. North Harbour, Gulf Islands and Onewa experienced the biggest declines.
Yield Compression Is Here to Stay
The yield on an Albany bakery shop has dropped by over half a percent in the 3 years since it was built, a signal that continuing yield compression is here to stay.
The shop is in the 252 Oteha Valley Rd neighbourhood centre, at the entrance to the Albany City development. It was built new in 2016 and sold then at a 4.9% yield on initial rent. It sold again at Colliers North Shore’s auction on Wednesday at a 4.36% yield.
Barfoots’ Residential Performance Mainly Negative vs Last Year
Bob Dey does a bit of investigative journalism and finds that, “Barfoot & Thompson lost 40 sales from its October 2018 residential statistics in the figures it presented this week, making its October 2019 performance look less weak. According to the calculations the real estate agency presented last November & December, it sold 884 homes in October 2018. In the statistics out this week, that figure dropped to 844. A 6.8% sales decline thus turned into a less unfavourable 2.4% decline.”