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Average home prices in New Zealand reaches 8.8 times average household income

businessdesk.co.nz

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Re: Average home prices in New Zealand reaches 8.8 times average household income

#101

Post by zimpenfish »

mattclarkdotnet wrote: post #56
berkut wrote: post #25

Earlier quoted context omitted.

In Wellington at least (where I live), there are limits on the density of housing that can be built (and height). Recently, the council was going to free up some of these restrictions a bit, but there was a lot of backlash by residents who didn't want the "character" of their neighbourhoods to be affected, so the relaxation in the rules has been a lot less. Wellington is a bit different in that there is a limit on th…

“pinned in” - meaning “penned in”? I can see they’d sound the same in a New Zealand accent so just idly wondering

"penned for pinned" is in the Eggcorn database[1] - doesn't look like "pinned for penned" is yet but probably worth a contribution (also see the pen pin dictionary definition in the linked thread.)

[1] http://eggcorns.lascribe.net/forum/viewtopic.php?id=7251

Re: Average home prices in New Zealand reaches 8.8 times average household income

#102

Post by zimpenfish »

dazc wrote: post #18
dijit wrote: post #17

Earlier quoted context omitted.

That's not normal? I paid half my income to rent when living in London 10 years ago, and prices have only gone up since then.

I lived up North 10 years ago and my rent for a 2 bedroom house was £320 a month. It wasn't in bad area either.

Similar - 20 years ago in Newcastle, 3 bed terraced, rented for ~£330 a month, pretty good suburb.

Re: Average home prices in New Zealand reaches 8.8 times average household income

#103

Post by smcl »

Markoff wrote: post #60
NiekvdMaas wrote: post #11

Compared to some other countries: The Netherlands: €31.5k average household income, average house price €387k - so 12.3x. UK: £31.4k average household income, average house price £274k - so 8.7x.

Czechia - 220K CZK per person with average household 2.1 people makes 462K CZK / 18823 EUR with average real estate price 3.751M CZK /153K EUR (65m2, data from end 2021) so roughly 8 yearly average household incomes to get average 65 m2 apartment with prices varying a lot across regions (in Prague would such apartment cost almost exactly double price) https://www.kurzy.cz/zpravy/630209-prijmy-a-zivotni-podminky... ht…

It spreads too, in the little towns around Brno prices are raised as relatively wealthy people (who aren't quite able to find something suitable in their budget range in the city itself) seek to buy something near the city and commute or work remotely. I don't imagine the salaries of the people who were previously living in these towns and villages have risen the same way salaries in the city have.

Re: Average home prices in New Zealand reaches 8.8 times average household income

#104

Post by ido »

Escapado wrote: post #100
lqet wrote: post #51

Where I live (southern Germany), you cannot find a house under 600,000 EUR. The average net household income in Germany is around 43,000 EUR. That means that house prices here are over 16 times the average household income. Yupp, it's bad. My wife and I both have university degrees, we have good and secure jobs, and our net household income is above average. But we have generally accepted the fact that it is impossib…

It's pretty much the same for anything around the city of hamburg in the north and most of the time it's less about the houses and more about the land they sit on. Building got more expensive but land even more so. 1.000 EUR/m² of land for adjacent cities are becoming the norm. Most of my friends graduated from university with either a bachelor or a masters degree and only those who stand to inherit a sizable sum of…

I don't disagree that the housing market in german cities is overheated, but isn't it pretty standard to take 30+ year mortgages? Keep in mind that 20+ years into paying this back your monthly payment will not increase to 2042 levels but remain in current 2022 levels.

Re: Average home prices in New Zealand reaches 8.8 times average household income

#105

Post by refurb »

msh wrote: post #10
muchtest wrote: post #6

It annoys me when they compare countries and don't consider income tax - you don't pay with pre tax income... If you earn 150k in High Tax Euro Country you're losing 50% of that. In low tax US state you're closer to 33%. Thats the difference between 75k and 100k.

But then you also have to consider what services are included in the tax that the lower tax rate might have to pay out of pocket.

Such as? At that income level you have great health insurance, can still qualify for state schools, maybe childcare?

I agree at lower taxes the difference is more stark.

Re: Average home prices in New Zealand reaches 8.8 times average household income

#106

Post by incomingpain »

lqet wrote: post #51

Where I live (southern Germany), you cannot find a house under 600,000 EUR. The average net household income in Germany is around 43,000 EUR. That means that house prices here are over 16 times the average household income. Yupp, it's bad. My wife and I both have university degrees, we have good and secure jobs, and our net household income is above average. But we have generally accepted the fact that it is impossib…

>Where I live (southern Germany), you cannot find a house under 600,000 EUR. The average net household income in Germany is around 43,000 EUR. That means that house prices here are over 16 times the average household income. Yupp, it's bad.

1.65 % for a 5 year fixed mortgage at sparda bank. While inflation is at 7.4% in germany...

Each year you don't pay any interest, you are paid 5.75% to have debt. They(mainly retirees) are giving you roughly $34,500 each year to buy a house. Mind you, they(mainly retirees) want to sell their homes. Hence the beneficial arrangement for you.

Even when inflation gets under control and they get back to ~2%. You'll still be earning some small stipend.

If you don't buy a house, your rent is literally equity that you lost. That's coming out of your retirement fund.

Moreover, that $600,000 isn't going to be paid in 5 years. You'll amortize it for ~25 years. In 15 years the remaining mortgage will feel like it's nothing. Your salary will be $100,000 or more and the remaining mortgage will be nothing.

In high inflation, low interest rate environments. Buying a house is a no brainer with only 1 exception. Are you betting the housing market will crash? That you'll be able to buy homes for much cheaper and possibly cheaper rates? That's the only bet you're playing right now.

Re: Average home prices in New Zealand reaches 8.8 times average household income

#107

Post by nsonha »

mpol wrote: post #37
xupybd wrote: post #14

I live in NZ and my home has more than doubled in value over the last 5 years. The rapid increase in prices is scary.

Can you explain what the cause of this sharp rise is? The linked article has nothing on that. It even feels a bit alarming without much depth. And is anything being done? In the Netherlands, many investors, big and small, are buying up houses to rent out. Airbnb renting was a part of this as well. Many local governments are now creating rules, like, you have to live in the house when you buy it. Also, some taxes for…

I'm not a kiwi but I heard until recently, or still, New Zealand either has low or no tax on foreign property investments? If it's true, it's like an open invitation to regional millionaires from a certain country where people can't even legally own properties.

Re: Average home prices in New Zealand reaches 8.8 times average household income

#108

Post by Bilal_io »

yardstick wrote: post #86

In NZ we have created a culture that obsesses with house prices. It's been this way since at least 2000, if not earlier. Many peoples retirements plans hinge on them being landlords or holding large amounts of property. The NZ share market is a joke. Pretty much any serious global company that started in NZ moves away from NZ without even entering our sharemarket. There are a few exceptions of course, but by and larg…

How is the startup scene in NZ?

I wonder if local investors could focus on that, even if they have to import talent. Perhaps there are regulations preventing this?

But, of course I am saying this realizing startups are not a "quick buck" like real estate.

Re: Average home prices in New Zealand reaches 8.8 times average household income

#109

Post by nikanj »

Fire-Dragon-DoL wrote: post #98
nikanj wrote: post #63

Earlier quoted context omitted.

This is assuming the priced don’t increase. In many places, the prices increase so fast your downpayment grows faster than your savings. Home value goes up 10%, from 1 million to 1.1 million, 20% downpayment goes up from $200k to $220k. If you’re saving under $1666 per mo, you’re actually further away than you were last year. In Vancouver, the average price is $1.36 million and it went up 21% in a year. For detached,…

The greater Vancouver area though is not 1.3M and a detached house is something not even taken in consideration in Europe. I lived in Rome and having a yard meant you were loaded

This was the first hit from Google https://wowa.ca/vancouver-housing-market

Re: Average home prices in New Zealand reaches 8.8 times average household income

#110

Post by maccard »

5350-uiop-1130 wrote: post #24
NiekvdMaas wrote: post #11

Compared to some other countries: The Netherlands: €31.5k average household income, average house price €387k - so 12.3x. UK: £31.4k average household income, average house price £274k - so 8.7x.

What is most depressing to me, where do people get the money??? It would take me 30 years of saving to get 500k, that's like 70-80% of my working life. That's assuming you don't get sick or lose your job. This metric annoy me because only a fraction of your income can go toward rent or mortgage . You would pay over 100k in interest fees alone on a long term mortgage.

> What is most depressing to me, where do people get the money?? It would take me 30 years of saving to get 500k, that's like 70-80% of my working life.

Mortgages. This is why they exist.

> You would pay over 100k in interest fees alone on a long term mortgage.

You pay 100k of today's money in interest and fees over the course of 30 years. 100k in 1992 was worth far far more than 100k is worth today.

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