The Real Estate Institute of New Zealand’s (REINZ) latest House Price Index, which adjusts for differences in the mix of properties sold each month, revealed that home values nationally have plunged 12.6% from their November 2021 peak, with Auckland down 17.3% from peak and Wellington down a whopping 19.8%.
The rapid collapse in values has left several contestants on popular renovation program The Block empty handed after their homes, which they spent months renovating, were passed in at auction:
The winning couple on the finale of New Zealand’s The Block have netted just $NZD4000 ($AU3046) in a record-low auction result for the local franchise…
To make matters even more dire, the couple who came in second place, Maree and James Steele, made just $NZD100 ($AU76) once their home sold.
“We’ve got petrol money!” Maree joked.
Things weren’t faring any better for the remaining two pairs, whose properties were passed in.
The horror outcome of the series, hosted by ‘New Zealand Scott Cam’ Mark Richardson, has left many viewers calling for the show to be scrapped after nine seasons, particularly at a time when the cash rate continues to hike.
I wonder if Kiwis will donate to The Block’s losers, like they did in 2017:
For Christchurch brothers Ling and Zing, their $1000 profit makes them the second lowest winners in Block history – just over Rachel and Tyson in season one, who sold their house bang on reserve and failed to make any profit.
Zing and Ling’s profits were so low that one “disgruntled viewer” set up a Givealittle page for the pair to “help them raise funds for the reward they deserve”.
So far, 204 donors have pledged $5041, four times what the pair earned at last night’s finale.
In all seriousness though, renovating and flipping homes for profit only works in a stable or rising market – the polar opposite of what New Zealand currently has.
House prices across New Zealand are plummeting after experiencing one of the world’s biggest rises over the pandemic. These price falls should continue, given the Reserve Bank has committed for further interest rate hikes to tame inflation:
Committee members agreed that monetary conditions needed to continue to tighten until they are confident there is sufficient restraint on spending to bring inflation back within its 1-3 percent per annum target range. The Committee remains resolute in achieving the Monetary Policy Remit.
The Block should go on hiatus for a year and only return once the Reserve Bank starts cutting rates and the market turns.
