New house listings and sales have been somewhat delayed this spring due to the effect of people waiting until after the election result to make a decision. However, both are starting to pick up now, and agents are suggesting that sales volumes for November/December will be back to normal.
Be that as it may, there is likely to remain a further uncertainty for some time to come as far as the property market goes under the new Labour-led government, rather than if National had been given another crack at it. This is simply due to the fact that Labour has more policies that will both, directly and indirectly, impact the property market. Some of these are already coming into effect (such as foreign home ownership restrictions), and some could take longer to make an impact, such as changes to tenancy agreements.
North Shore prices are down slightly (0.9%) over the past 12-month period, and volume of sales has reduced significantly by about 30% from previous highs. Tighter lending from the banks, stricter LVR (Loan to Value Ratio) limits and slightly higher interest rates are starting to take their toll on the market. However, all this really means is that we are starting to return to a “normal” market, after the humongous peaks of a couple of years ago.
Current house prices are still pretty high, that’s true – but they were also considered high back in the 1980s. Back then, we also had way higher interest rates, high inflation and high unemployment to contend with. People still bought houses – and those people are now sitting on a very nice pile of equity, given how much the prices have skyrocketed since then.
The path to real wealth
Your house is usually your biggest asset, and most homeowners have a significant amount of their wealth tied up in that asset because you have to have somewhere to live. However, owning one house that you live in isn’t the way to build real wealth. The key path to real wealth building is to purchase a second home, and perhaps a third or fourth, or even more.
How’s your retirement looking? What’s your plan to generate passive income so that you aren’t reliant on just a small pension to live out your golden years on?
Here in Auckland, we are lucky enough to live in a prime and highly sought-after location, where new families are continually aspiring to move to, so the appetite for new properties in this desirable location is continuous, no matter the market conditions.
So the big question isn’t whether you should buy a house right now, but whether you can afford not to. That’s where the risk lies.
Come on in and see us today for advice on how to start building your property empire. For more information check out Despite Record Sales, UK Lottery icipation Falls …and More! – Lotnext