NZ economy one of the strongest in OECD

Friday June 27th, 2014

Paul Bloxham, the man who dubbed New Zealand "the rock star economy", is sticking to his guns.

Bloxham, HSBC's chief economist for Australia and New Zealand, said the local economy was still powering ahead and was likely to outstrip other countries in the OECD.

Statistics NZ said on Thursday that New Zealand's gross domestic product grew by 1 per cent over the March quarter and by 3.3 per cent over the March year.

"New Zealand is still rocking," Bloxham said.

"We still think that New Zealand will be the rock star economy in 2014."

While the economy was performing strongly, the other developed world economies were not doing so well.

HSBC expects growth in the US this year to come in a little under 2 per cent and Europe's economy to grow by just 1 per cent.

"So amongst all the OECD economies, New Zealand looks as though it has a good chance of being one of the strongest performers ... this year," he said.

That, in itself, would present challenges.

"One of the challenges is that it puts more upward pressure on the currency," Bloxham said.

The Reserve Bank last week raised its official cash rate by 25 basis points to 3.25 per cent and is expected to keep raising rates to try to stave off inflation arising from strong growth.

Bloxham said the high growth/higher interest rate scenario was likely to keep upward pressure on the New Zealand dollar, which was trading yesterday at about US87c — just short of its record post-float high of US88.4c, set in August, 2011.

Domestic interest rates look set to be significantly higher than most of those in the developed world economies, he said.

At the same time, the US dollar has not provided what many expected would be a brake on further advances in the kiwi because the US economy has not fired up.

Key US 10-year bond yields started the year at 3 per cent and have since shrunk back to 2.6 per cent, indicating America has a long way to go before getting up to speed.

Bloxham said demand for New Zealand key exports of dairy and meat did not look like falling away any time soon because of ongoing strong demand from China.

China was in the midst of a transition from an investment phase, which demanded raw materials such as ore and coal — to a consumption phase, which placed greater demand on soft commodities such as dairy and meat.

Source: New Zealand Herald

New Zealand property exhibits big gains on a global scale

Thursday June 19th, 2014

The International Monetary Fund (IMF) has launched Global House Price statistics to keep track of booms and busts around the world.

The new Global Housing Watch web page tracks developments in housing markets around the world and shows property price performance and values to income and rent ratios in various countries.

The biggest annual property price rises among the featured countries have come in the Philippines, Hong Kong and New Zealand, with the biggest falls coming in India, Greece and Italy, according to the IMF data shows.

Click on the below link to read full article and view graphic representation...

http://www.opp-connect.com/12/06/2014/new-imf-housing-data-keeps-track-of-booms-and-busts/

Melbourne apartments hit new high, outstripping family homes

Wednesday June 18th, 2014

Melburnians are embracing apartment living, with mid-sized apartments attracting a higher rent than three bedroom houses across the city.

The new REIV data show that two-bedroom apartments attract a median weekly rental of $390, an increase of 1.3 per cent on the December quarter. The rental compares to $370 a week for a three-bedroom house.

And the highest rental growth for the quarter was in one-bedroom apartments, with this sector recording 2.7 per cent growth - lifting the weekly median rental for these apartments to $340 a week.

REIV CEO Enzo Raimondo said that the fast expansion in new-build apartments appears to have been a drawcard for renters.

"These apartments continue to attract good rents,” he said. “It appears that this ‘state-of-the-art’ style of living is appealing to, and drawing tenants across Melbourne.”

Mr Raimondo noted that apartments are often in prime, central and inner city locations, while three-bedroom houses are spread across inner, middle and outer Melbourne.

“This locational factor has some bearing on rents for houses and apartments - however the clear difference between the rental price for a two-bedroom apartment in comparison to a family home does highlight the genuine appeal of newer apartments.

“While houses boast large living areas and yards, apartments – with the latest in interior design and impressive shared facilities – are yielding higher rents.”

The REIV produces weekly rentals and vacancy rates across Melbourne on a quarterly basis to inform the investment community and public. The information provides guidance on rental levels and vacancy rates.

Mr Raimondo said vacancy rates had declined slightly over the quarter and remained low. He said the overall Melbourne rental vacancy rate was 2.8 per cent, down from 2.9 per cent in the December quarter and 3.2 per cent in the same quarter last year.

Source: Real Estate Institute of Victoria

Australia in global top 10 for price growth

Wednesday June 18th, 2014

Property advisory firm Knight Frank has released analysis, placing Australia in the top 10 nations globally for real estate price growth.

The Knight Frank Global House Price Index for the first quarter of 2014 sees the nation at number seven on a ranking of countries with the biggest price gains.

Michelle Ciesielski, an associate director at Knight Frank, says the result highlights a return to form for Australia and other markets.

“The turnaround in the US, Australian and Icelandic housing markets is evident with three countries now appearing in the top 10 rankings for annual price growth alongside key emerging markets such as China, Turkey and Brazil.”

Dubai topped the annual rankings, but prices rose by only 3.4 per cent in the first quarter, compared to a 9.2 per cent jump over the same period in 2013.

Croatia, Cyprus and Greece were the weakest-performing housing markets in the 12 months to March 2014.

Although the index saw slower growth in the first quarter of 2014 compared to last quarter, it still recorded annual growth of 7.1 per cent.

Ciesielski says their outlook remains bullish for future results.

“We expect to see the index’s performance strengthen again in the second quarter,” she says.

“All eyes will remain on central banks, in particular the Federal Reserve, the Bank of England and the European Central Bank.”

And she says the pace of monetary policy change will be the determining factor.

“The issue is not when interest rates rise but the speed and extent to which they do.”

Source: Australian Property Monitors

NZ houses on China's top-10 list

Tuesday April 8th, 2014

New Zealand is on a list of the top 10 most searched for countries by Chinese house-hunters, figures compiled from China's largest property search engine reveal.

The figures show Chinese buyers' rapidly growing interest in our housing market - the country was not in the top 50 in 2012.

And it's not just Auckland and Wellington on the shopping list any more, buyers are increasingly looking in the smaller regions.

While attracting a much smaller number of buyers, Kerikeri, Nelson, Kaiteriteri, Paihia and Gisborne are rapidly growing areas of interest.

The information was provided to the Herald by Juwai.com, the world's biggest Chinese property website, showcasing more than 2.2 million property listings from 53 countries.

Many large real estate agencies, including Ray White and LJ Hooker, list with the company.

The site is visited daily by thousands of property buyers from China, as well as Chinese communities in Taiwan, Hong Kong, Malaysia and Singapore.

Interest in New Zealand property on the site grew by 89 per cent last year.

It was at number nine on a list of the top 10, ahead of Spain. The United States was top.

"It used to be that New Zealand was unknown in China. It didn't even appear in the top 20 destinations," said Juwai co-chief executive Andrew Taylor.

"But the Chinese have begun to learn about it. The New Zealand brand in China is high quality, natural and attractive."

Auckland was the most searched-for city in New Zealand, followed by Dunedin, Christchurch, Wellington and Taupo.

The national president of the NZ Chinese Association, Virginia Chong, said the organisation had just opened its 14th branch, in Nelson, home to a growing Chinese community.

The relationship between China and New Zealand was growing economically and politically so the Chinese public were learning more about the country, she said.

"All they've known is apartments, apartments, apartments, and the smog, traffic problems. Compared to other countries, I think they can slot in quite easily here, with minimal amount of discrimination ... people see them as just being one of us now."

Auckland real estate agency Property Asia Ltd offers groups of Chinese buyers guided tours of properties.

Andrew Taylor said Chinese buyers were "seldom short-term speculators".

Parents often bought homes for their children to live in while studying, but the property served as a long-term investment.

Most searched for countries according to Jawai.com

• United States

• Australia

• United Kingdom

• Canada

• Singapore

• Germany

• Italy

• Thailand

• New Zealand

• Spain

Source: nzherald.co.nz