Global Housing

4

Canadian house prices hit record as risks build

By Leith van Onselen The Canadian housing market continues to bounce back from a mini slump brought about by a range of macroprudential controls introduced last year on high loan-to-value ratio mortgage lending, which including shorter maximum loan amortisation periods (i.e. 25 years instead of 30 years). After house prices fell for six consecutive months

20

Dutch housing bust intensifies

By Leith van Onselen I have noted previously (here, here, and here) how the Netherlands housing system all but guarantees unaffordable housing and a susceptibility to housing bubbles, via: ridiculously easy credit, with a third of mortgages guaranteed by the government; mortgage interest tax relief and generous subsidies offered to home buyers; a dysfunctional rental

8

Canadian house prices set new record

By Leith van Onselen Back in February, the Canadian housing market looked to have hit a wall. The Government had recently implemented a range of macroprudential controls on high loan-to-value ratio mortgage lending, including shorter maximum loan amortisation periods (i.e. 25 years instead of 30 years), and house prices had fallen for six consecutive months

16

NZ Finance Minister argues to free-up land supply

By Leith van Onselen New Zealand’s Finance Minister, Bill English, has today firmly argued against urban containment policies that are contributing to the current blowoff in the Auckland house price bubble. From Interest.co.nz: Finance Minister Bill English has spoken out against “compact cities” saying that they drive up house prices. In a speech to the

35

Economists still blind on the housing supply-side

By Leith van Onselen Interest.co.nz has today posted an interesting article quoting Westpac Bank economists on the Auckland housing market, where the stratified median house prices hit a record $634,000 in June (see next chart). From Interest.co.nz: The rapidly heating Auckland housing market is being driven primarily by buyers’ expectation of capital gains – not

7

Bridging the housing-infrastructure divide

By Leith van Onselen Interest.co.nz’s Bernard Hickey published an interesting article over the weekend arguing that New Zealand’s councils, which are primarily responsible for planning and land supply, should be paid a share of income taxes rather than just receive rates in order improve incentives for development: Developers, builders, renovators and potential home buyers are

23

It’s time to levy the land

By Leith van Onselen The Economist over the weekend published a great primer on the benefits of broad-based land taxes: Taxing land and property is one of the most efficient and least distorting ways for governments to raise money. A pure land tax, one without regard to how land is used or what is built

17

Texas wins on housing

By Leith van Onselen Earlier this year, Trulia published an interesting article on how thousands of Californians are emigrating to other states due to exorbitant housing costs, with many choosing to settle in Texas: A constant debate in California politics is whether jobs and people are leaving the state… Here are the basic facts. In

9

US house prices boom

By Leith van Onselen The Case-Shiller 20-city house price index for April 2013 was released over night, which revealed an ongoing recovery in US house prices, with prices lifting by a seasonally-adjusted 1.6% over the month, 4.9% over the quarter, and 12.0% over the year. It was the biggest yearly price gain since March 2006

42

An 8-step plan for housing affordability

By Leith van Onselen The Bank of New Zealand’s chief economist, Tony Alexander, has today provided a radical eight-point plan to restore housing affordability. From Interest.co.nz: Alexander says the optimal solution to the problem “is a quick jump in house supply combined with reductions in building materials costs”. His suggestions are: Initiate a large builder

13

The UK housing conundrum

Cross-posted from Coppola Comment House prices in the UK are too high. How much too high they are depends on where you are: house prices have been rising in London because rich Asian businessmen and French aristocrats are buying up prime real estate as a safe haven investment for their filthy lucre, apparently. But outside

46

UK doubles down on housing disaster

By Leith van Onselen Regular readers will recognise that I am highly sceptical of the UK housing system, which I believe operates world’s worst practice when it comes to social and economic outcomes. A key tenet of the UK’s housing malaise is its dysfunctional supply system, which has become increasingly constipated following sixty years of

21

The Great Reflation

When it comes to analysing the US housing market, few people have a better track record than Peter Schiff, CEO and chief global strategist at Euro Pacific Capital Inc. In 2005 and 2006, Schiff told over 1000 mortgage brokers that they were about to lose their jobs and, in the process, completely nailed the coming

13

Auckland: the land bankers paradise

By Leith van Onselen In late 2011, I published a detailed article entitled Why developers land bank, which sought to explain the reasons and motivations behind land banking. A central theme of my article was that land banking is often a rational response to regulatory (or other) restrictions on land supply: …land banking – an

12

Canadian housing market hits the wall

By Leith van Onselen The Canadian housing market, ranked by The Economist as one of the world’s most overvalued, looks to have finally hit the wall. After peaking in August last year, house prices have begun to fall, down -1.2% nationally (see next chart). More importantly, a new report from the Canadian Association of Accredited

21

IMF recommends taxes on vacant UK land

By Leith van Onselen Earlier this month, I posted an article arguing strongly that Australia’s state and territory governments should look to replace stamp duties on property transfers with a broad-based land values tax, levied on all properties: Broad-based land value taxes (LVT) would… assist in the provision of new housing via two channels. First,

9

Canadian house prices rise again

By Leith van Onselen Canadian house prices have continued to recover, with the Teranet repeat sales index registering a 0.2% increase nationally over April, the second consecutive monthly increase after six straight months of price falls (see next chart). Canadian house prices have now fallen by -1.2% since values peaked in August 2012, but remain

12

US house prices rise again

By Leith van Onselen The Case-Shiller 20-city house price index for February 2013 was released over night, which revealed an ongoing recovery in US house prices, with prices lifting by 1.2% over the month, 3.2% over the quarter, and 9.4% over the year. It was the biggest yearly price gain since May 2006 (see next

44

Brits pack ’em in like sardines

By Leith van Onselen Those who have followed this blog for a while will know that I am highly sceptical of the UK housing system, which I believe operates world’s worst practice when it comes to social and economic outcomes. Central to the UK’s housing malaise is its dysfunctional supply system, which has become increasingly

3

More warnings of a Hong Kong housing bust

By Leith van Onselen Hong Kong’s housing market has, for a long time, been a boom/bust market. According to Puru Saxena, an established money manager based in Hong Kong, there have been two episodes since 1980 where Hong Kong property prices fell by 50-60%.  In 1980, prices peaked and bottomed-out four years later losing over

27

UK mortgage subsidies score big FAIL

By Leith van Onselen The fallout from the UK’s £130 billion of government mortgage guarantees (dubbed the “Help to Buy Scheme”), announced in the recent UK Budget, continues. Last month, the Office of Budget Responsibility (OBR) – the Government’s favoured economic forecaster – slammed the proposal, arguing that it would simply inflate house prices without

7

Canadian house prices bounce back

By Leith van Onselen The Canadian housing market staged a recovery overnight, with the Teranet repeat sales index registering a 0.4% increase nationally over March, breaking a run of six straight months of falls (see next chart). Canadian house prices have now fallen by -1.4% since values peaked in August 2012, but remain 25% above

29

Auckland housing goes bananas

By Leith van Onselen Please find above a cracking interview between Interest.co.nz’s Gareth Vaughan and John Bolton, principal of Squirrel Mortgage Brokers, discussing the Auckland housing market. As readers might recall, last week Auckland’s stratified median house price hit $600,000 for the first ever time, according to the Real Estate Institute of New Zealand, following

28

London pushes UK house prices up

By Leith van Onselen UK house prices are reportedly on the increase again, with prices hitting a five-year high in March, driven by strong growth in London, according to Acadametrics LSL: London’s property market powered a seventh month of increases in U.K. house prices in March as values reached a five-year high, according to Acadametrics

21

Housing bust plunges Dutch into economic crisis

By Leith van Onselen I have noted previously (here, here, and here), how the Netherlands housing system all but guarantees unaffordable housing and a susceptibility to housing bubbles, via: ridiculously easy credit, with a third of mortgages guaranteed by the government; mortgage interest tax relief and generous subsidies offered to home buyers; a dysfunctional rental

2

Hong Kong property bubble about to pop?

By Leith van Onselen Over the past week, two separate reports have been released warning of an impending bursting of Hong Kong’s property bubble. The first, by ANZ Bank (full report below), argues that Hong Kong housing is significantly overvalued following a 23% increase in prices over the past year, compared with economy-wide growth of