But many other econimists commented that there 15 reasons to fall in price of property but BNZ cheif economist is still optimistic The reason for falls in price are
2. Auckland unitary plan
3. Tougher lending criteria
4. Better property value in comparable international cities
5. Wage stagnation limiting rental income
6. Slow down in China’s economy
7. Australian banks are over leveraged leading to a credit crunch here.
8. Rising NZ Dollar is a deterrent to foreign investors
9. Second highest level of household debt to GDP in the world.
10. Increasing unemployment
11. US Federal Reserve increasing interest rates
12. Projected slow down of immigration
13. The poor quality of NZ Housing stock
14. Rise of the prefab housing industry
15. Contraction in consumer consumption..
all the property in NewZealand
BNZ chief economist Tony Alexander said there were a number of things that were putting pressure on Auckland’s house prices, and showing no sign of letting up.
“Enjoy if you have already bought. Despair if you have not,” he said.
“And if you have put off buying because of one of the many incorrect forecasts that house prices were about to fall –but it never happen,
More Chinese buyers are likely to look for properties in New Zealand,: BNZ chief Economist, he commented that ,all predictions of an Auckland housing market collapse proved wrong Chinese buyers, who have been credited with fueling some of the heat in the Auckland market in particular, were likely to enter the city’s housing market in even greater numbers, he said.
“We really don’t know the proportion of sales going to offshore Chinese and we never will because people often buy on behalf of Chinese people back in China,” he said.
“Millions of people in China want to buy offshore assets partly to get their funds off the mainland. Currently there is a legal limit of US$50,000 per adult per annum of funds which can be taken out of China. The ability to get around this rule has been constrained for the past two years by a massive anti-corruption drive. Eventually that drive will fade. Also, eventually the rule will be relaxed. In coming years there will continue to be strong demand for properties in New Zealand, predominantly Auckland, property, by Chinese buyers.”Not enough houses had been built in the city since the mid-2000s. It had gone into the global financial crisis with a housing shortage that had then got worse, Alexander said. He said there was a huge and still growing backlog of people who wanted to buy but had put the decision off over the past few years.
Population growth, particularly in Auckland, was also likely to continue. He add that there are many reasons to increase the property price in future due to the facts he pointed out .
Some of the reasons he identifies are well-known, such as strong population growth exceeding housing supply, record low interest rates making borrowing cheap, and regulations limiting land supply and making building homes expensive.
But it also contained a shot at commentators who predicted house price crashes.
Number 12 on his list was “people are ‘catching up’ on buying they did not do from 2008 until recently as they sat listening to people in the world of ‘should’ expecting prices to fall 40 per cent”.
Societal changes were also playing a part, including people focusing on building more wealth as they expected to have to live on it for longer, or older people splitting up and needing two homes