Just about everyone has jumped on the computer to have a look by now, I'd say, and just about everyone's house has gone backwards.
So my house - it's gone down in value by 8 percent. One of the bosses, not too bad, only gone back by 4 percent. I don't think anyone's house has gone up in the office. Someone's house has dropped by $250,000.
One colleague, and this colleague is suffering more than anybody else - her house has gone down by 21 percent. That's $1.15 million down to $900,000. That's another $250,000 shaved right off right there. Someone's feeling agitated.
I called a real estate agent today to see if it's wider than just our office. They told me, yep - and people are not happy.
Another real estate agent reckons he's already fielding calls from buyers who are mid-negotiation, who are now saying they're not gonna lift their offer anymore.
They're just gonna leave it right where it is, because look at the valuation that's out today.
Auckland Council says they normally have about 500 people on their website at any one time. When we called, they said they were watching 12,000 people on their website at any one time.
As I said yesterday, spare a thought for Auckland. If you have an Aucklander in your life, spare a thought for them because it's a tough day for Auckland today.
Because, I mean, we take the mickey out of Auckland, but there is good reason why Auckland feels like this.
Houses in Auckland mean a lot, don't they?
I feel like probably more than anywhere else in the country apart from maybe Queenstown and the surrounding area, because houses are expensive in Auckland.
Young Aucklanders obsess about it. They scrimp and they save, and they try so bloody hard to get into their first house. It's totally understandable that absolutely no one in this town wants to watch their house then go down in value.
But of course, bear in mind, it is slightly irrational. If you are one of these Aucklanders doing this, you are being irrational, you realize that, because you're not suddenly poorer today than you were yesterday, are you?
I mean, the value of the thing has not changed overnight. It's simply just been written down. In fact, it was written down a year ago, it's just taken them a year to put it out there.
And if you're buying and selling in the same market, it really doesn't matter at all. It's only if you're cashing up to move out of town or to get rid of an investment property or something like that, that this actually matters.
Now, I say that knowing that none of that is gonna sink in - we're gonna continue to be irrational because it is all in our heads, isn't it?
We feel wealthier when the house is worth more, and that ain't what happened today.
Heather du Plessis-Allan is a journalist and commentator who hosts Newstalk ZB's Drive show HERE - where this article was sourced.
14 comments:
If Aucklanders feel hard done by, try being a Wellingtonian. But if your rating value drops, what's the problem?
If house valuation drops 20% will rates, based on valuations, go down 20%?
Clarifies why Labour never introduced a capital gains tax. Would have produced mamoth tax credits. Difficult to assess the influence of latest zoning regulations. Near all properties are under threat from towering structures hard alongside,and especailly in areas near rail stations.many would rather take a punt in Melbourne. If notice had been taken of Winston's views on immigartion, these desperately unfair yo yos of house prices would be alrgely avoided. Property owners with proven too conservative flood zones are unfairly hard hit, with little realistic comeback.
Many will have a debt mortgage which will be greater than the actual value. If Banks insist that that be brought back into line, then the real problems will start. But because the problem is so great Banks will hold back but may do it on a small but selected few
At least you still get something if you sell it now though. The greens and tepartly parties both believe that all land in nz is stolen land. Once your land is declared maori land who will buy it? Maybe you will have to pay a lease fee for your house that is now on maori land. The maori party have a first right of refusal policy for all private land.
The cost of housing isn’t the same as the value of a home. The rise in the cost of housing is more of a testament to inflation in this market due to dual-income household debt and loss of purchasing power than real value.
Perhaps someone could give Heather an intervention and explain there is a difference between CV and market value. Or would it be beyond her?
Valuation down but rates up.... the expected pattern.
No.
To Anon @ 5.40am & 6.35 am
No your rates will not go down. Wellington and Auckland CCs sent out letters, some time ago specifically stating this.
I think the valuations done in the previous round were a coordinated con nation wide. Most large Councils were struggling financially, so the valuations were hiked artificially high to justify high rate increases to help those Councils. Thinking I was probably being cynical with this idea I recently asked a prominent real estate agent if my thinking had any credence. The agent agreed with me.
What on earth is this woman wittering on about. It costs the same to run the city today as it did yesterday so of course the rates payable by individual households are unlikely to drop just because the allocation formula contains different numbers. The city still has to pay its bills. But all this misunderstanding would evaporate if the rate were struck say on the basis of each property's land area. That's just as arithmetically valid as using value, but naturally has a bunch of different issues. Or maybe we should just introduce a Poll Tax. That worked well when Margaret Thatcher tried it, didn't it?
Valuations don't set rates; they merely allocate liability. Councils, the ones we democratically elect, set rates by way of council vote. This is as it should be. In doing so councils have to weigh up between need, and politics - increasing rates is unpopular. The result has been that over time politics as won, and there has been in many instances a buildup of need involving some really major costs to bring infrastructure up to something like need.
As soon as I got to 'gonna' I gave up. Grow up Heather this deliberate sloppiness doesn't impress. If you cannot write properly I cannot bother to read what you think you are trying to say.
Just as bad as silly maori words.
Markets fluctuate ... real estate is no exception...get over it
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