Last night, I attended an auction at 60 Kowhai Road in Mairangi Bay with a buyer. The auction had been “brought forward”. This means that prior to the auction date, a buyer had made an unconditional offer to the seller that was acceptable to them. To be fair to all parties, it is Harcourts policy to contact all other buyers and advise them that an offer has been made and that the auction has been brought forward to a stated time and date. At the auction the offer is declared, and if any other buyer wishes to make a better offer,they then have that opportunity. Otherwise the property is sold! And at $855000 the property was sold without further ado. a very happy seller and a very happy buyer. There were at least 6 other disappointed buyers, and a lot of local community interest.

And right now,we are finding more and more auctions being sold prior, as buyers act quickly to get the home they need!  FOMO-Fear of Missing Out is making people make their minds up quickly. If you are thinking of selling better call me right away.

Property… Ride it out or Leap?. Two market commentators go head to head with opposing views on the real estate market. This just shows you, even the “experts” don’t know!

Interest rates continue to be under downward pressure after the Reserve Bank held the Offical Cash Rate at 2.5% as the ASB slashed floating mortgage rates.

My take on this is that real estate is about people wanting needing a roof over their heads. Most of the buyers we are dealing with simply need a home and now is the right time to buy, for them. Interest rates are at the right level and prices are OK too, now is good.

Right now I need a family home for a pair of teachers who have returned to New Zealand from the UK, they want to bring up their family in New Zealand. A couple have been transferred from Wellington to Auckland and want a home in Westlake zone for their teenage family. A young couple with small children at Hauraki Primary School have $700000 to spend in Hauraki Corner. A couple who want to retire to the North Shore need a 2/3 bedroom freestanding brick and tile up to $500000 in Takapuna or Milford and another single guy wants to move from Australia to Milford to be near his grandchildren who go to school at Milford Primary School, he has up to $500000 to spend on a 2 bedroom townhouse, too.

These are not property speculators, Mr Bollard, they aren’t in the market  to make a quick buck or get a tax dodge, they just want a home. Sellers, call me if you can help.

Two articles in the New Zealand Herald are tipping that house prices are about to rocket by up to 30%! This, along with predictions that nationally they will rise by 24 %.

Infometrics state that house prices will rise by more 9% per year for the next three years, caused by immigration and growth in the Auckland area, accompanied by a housing shortage and low interest rates. See the article here. There is an accompanying article on the national house price prediction: a 24% rise over three years.

Meanwhile, Bill English muses that the way to prevent a “premature boom” is to introduce a capital gains tax, he better get in quick while we still like the National Government. The is nothing surer that the honeymoon with the Bill and John Key would be well and truly over should a capital gains tax be introduced, but John says that would be better than raising GST to curb spending. Oh boy!, Hobsons Choice! Here’s what Bill said.

And Bernard Hickey? What does he say? Well down by 15% (not 30%) by the end of 2010. Why: because house prices are still not affordable for the average person, and rental yields do not justify the prices paid for property. Bernard’s big concern is that the major banks will start borrowing cheap money from off shore. Remember New Zealand’s interest rates are still high by international standards. He has an excellent and persuasive article here!

What does all this mean? It is difficult to see that New Zealand’s love affair with property will wane despite the calls from our leaders and economists that we must start investing in “productive” assets. One thing we do know is that right now, it is a good time to sell, probably the best it has been for 18 months.

This spring looks like being a doozy if you are selling. Call me on 0800 61 8888.

The Reserve Bank of New Zealand has just decided not to alter the Official Cash Rate. If you are borrowing right now it is unlikely you will see further big interest rate reductions, so while you can get money at 5.4% the banks are suggesting you fix that rate for the short to medium term.

Here’s the big banks’ forecast:

• ASB economists are sticking to their belief that the Reserve Bank (RBNZ) will cut the official cash rate (OCR) by 25 basis points in September and again in October, despite its views putting it squarely in the minority. Regardless of this, it believes there will be little impact on mortgage rates whether the RBNZ cuts or not.
• ANZ Market Focus is holding equally tightly to its view that the OCR is unlikely to see further cuts, suggesting there is only a one-in-five chance of an OCR fall. However, it suggests that should the RBNZ decide to cut, it is likely to be a 50 basis point reduction, rather than 25 basis points. It describes the interest rate curve as caught in a “tug-of-war” between global sentiment and the RBNZ’s “on-hold for longer” view.
• Westpac’s Weekly Commentary states that the RBNZ struck a “surprisingly dovish chord” in last week’s OCR review, suggesting it was more “downbeat” than June’s Monetary Policy Statement. There was no acknowledgement of the improving global outlook, or that domestic factors are “setting the stage for recovery”, it says.
• With much focus on the high NZ dollar in the RBNZ statement, Westpac’s central view is that if the market is overestimating the recovery’s strength, the NZ dollar will fall by itself; while if the market is right in its recovery assumptions then a strong NZ dollar will not be enough to negate that. It continues to believe that interest rates have bottomed and recommends fixing for six months to one year.
• When it comes to refixing most are recommending that short term is still the way to go.
• Best rate advertised this week 5.39%. Best quoted rate this week 5.30%.

For more information call Sue Isherwood or Craig Jones at Mortage Express on 0800 226 226.