We pulled 7 gems from the torrent of property news this week to keep you abreast of the most important insights affecting investors. 1-7 February 2020
In property news this week…
- Provincia Investor Information Evening – Prized Wiri Industrial Property
- Residential Listings Up in January, but Down Massively on Last Year
- Auckland Building Consents Hit Record High
- Prison Building Intentions Triple in 2019
- ANZ Raises Home Loan Rates
- RBNZ Expected to Hold OCR at a Record Low 1% Next Week
- Government $26 Million Out of Pocket on KiwiBuild Houses
Provincia Investor Information Evening – Prized Wiri Industrial Property
Provincia Property Fund has a prized industrial property in Wiri under contract and is nearing the end of the due diligence phase of the acquisition process.
We expect to commence a capital raising shortly and invite you to an investor information evening to find out more…
- DATES: Mondays 10-Feb, 17-Feb and 24-Feb (or by appointment)
- TIME: 6:15 PM for a 6:30 PM start
- WHERE: Our offices at 268 Manukau Rd, Epsom
- NOTE: Refreshments will be served
- RSVP: Reply to this email or email email@example.com or complete the online form here »
Residential Listings Up in January, but Down Massively on Last Year
Data from realestate.co.nz shows that while more people put their homes on the market in January 2020 than in December 2019, the total number homes available for sale nationally is down -21.7% compared to January 2019.
Not one region in New Zealand saw an increase in the number of homes for sale in January 2020 when compared to the same month last year.
Wairarapa and Taranaki saw the biggest drops in the number of homes for sale, seeing decreases of -49.3% and -46.9% respectively when compared to January 2019.
In the Bay of Plenty, total homes available for sale hit an all-time low for the second month in a row, dropping -20.6% since January 2019.
Vanessa Taylor, spokesperson for realestate.co.nz, says “We saw stock levels drop right down in December and they have stayed put ever since. New listings coming onto the market were also flat in the Bay of Plenty through January 2020.”
The silver lining in this dark cloud is that the shortage of listings has brought price pressure, with asking prices continuing to edge up. Good for sellers; not so good for first-home buyers.
Auckland Building Consents Hit Record High
The numbers of new dwellings consented in Auckland in the year ended December 2019 (compared with the December 2018 year) was 15,154 (an all-time record) – up 18%.
Nationally, the number of new dwellings consented was 37,538, up 14% from the December 2018 year.
The seasonally adjusted number of new dwellings consented fell -8.4% in November but bounced back +9.9% in December 2019.
I wouldn’t worry too much about an increase in house supply having a negative effect on rent prices though. The number of consents issued is barely on par with the previous record in 1974. Since then, New Zealand’s population has increased +67% but building consents are about the same. On a per capita basis, therefore, building consents last year were down -44% compared to 1974. It’s safe to say your rental income should keep growing for some time to come.
Prison Building Intentions Triple in 2019
About 3x the value of building work for prisons was consented in the December 2019 year ($229 million) than in 2018 ($75 million), Stats NZ said on Tuesday.
The jump in value of building consents for prisons reflects investments signalled by the Government for work across New Zealand, according to construction statistics manager Melissa McKenzie.
ANZ Raises Home Loan Rates
It’s nothing to do with interest rates in general, though, which are not rising. It’s all to do with buoyant housing market demand, which means ANZ is raising rates because it can.
ANZ’s new 1-year rate is 3.45% (from 3.39%), and 2-year rate is 3.65% (from 3.55%). Current home loan rates from all banks are…
- ASB: 3.39% 1-year; 3.55% 2-years
- TSB: 3.39% 1-year; 3.55% 2-years
- Westpac: 3.39% 1-year; 3.55% 2-years
- Kiwibank: 3.45% 1-year; 3.55% 2-years
- BNZ: 3.49% 1-year; 3.55% 2-years
- ANZ: 3.45% 1-year; 3.65% 2-years
RBNZ Expected to Hold OCR at a Record Low 1% Next Week
ASB economists expect the RBNZ to hold the OCR at a record low 1.00% on Wednesday next week and reiterate that developments do not warrant a change in the monetary policy outlook, but to signal their preparedness to lower the OCR if needed.
ASB still expects the RBNZ to hold out the prospect of further policy stimulus and has pencilled in a 25bp cut in 2020. Provided the economy smoothly navigates various headwinds, they say 1% may be the floor in the OCR this cycle.
Government $26 Million Out of Pocket on KiwiBuild Houses
There are $26 million of unsold KiwiBuild houses on the Government’s books, according to figures provided to interest.co.nz by Kainga Ora.