Global Housing

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

16

Korea acts to reflate housing market

By Leith van Onselen Last month, I wrote an article noting how the South Korean Government was looking to reinflate the housing market, which had stagnated over the past year or so and was beginning to weigh on consumption expenditure. Yesterday, the Korean Government announced that it would provide tax breaks to home buyers and

38

Australia must heed the UK property lesson

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

40

Dutch housing downturn crunches economy

By Leith van Onselen I have written previously 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 market that encourages households

19

Korea looks to reflate housing

By Leith van Onselen The Financial Times yesterday published an interesting article on the South Korean Government’s attempts to reinflate the housing market, which has stagnated over the past year or so and is beginning to weigh on consumption expenditure. According to the Financial Times: South Korea’s protracted housing slump is causing a headache to

19

NZ reinflates its property bubble

By Leith van Onselen Yesterday, the Real Estate Institute of New Zealand (REINZ) released its house price indices for the month of February 2013, which revealed an ongoing strengthening of housing prices across the country. The growth of median stratified house prices across New Zealand strengthened to 8.1% in the year to February, with Auckland

14

NZ minister vows to smash growth boundary

By Leith van Onselen I have written previously how in New Zealand’s largest city – Auckland – the Council had moved to tighten the city’s already highly restrictive urban growth boundary (called the “Metropolitan Urban Limit” or MUL) into an even tighter “Rural Urban Boundary” that would effectively ban development outside of the rural-urban line

54

US housing recovery on track

By Leith van Onselen Over the past few weeks, both the University of Michigan and the Conference Board released consumer sentiment figures for February, which beat economist’s expectations registering strong gains over the month. The University of Michigan preliminary index of consumer sentiment lifted to 76.3 in February from 73.8 in January. Economists had expected

40

More ACTion on NZ housing

By Leith van Onselen New Zealand’s ACT Party continues to raise the bar on New Zealand housing policy, challenging the two major parties – Labour and National – to undertake meaningful reform. On 25 August 2011, former leader and ex-Reserve Bank of New Zealand governor (1988 to 2002), Dr Don Brash, gave a speech in

38

US housing moves back into shortage

By Leith van Onselen In Friday’s article, How a property shortgage can turn to surplus, I noted how a perceived housing shortage in the US in the lead-up to the Global Financial Crisis (GFC) quickly switched into a surplus as the deteriorating economic conditions caused household formation rates to slump to 65-year lows in the

32

How a property shortage can turn to surplus

By Leith van Onselen ‘Underlying demand’ (or ‘pent-up’ demand) is the common method used in calculating whether there is a housing shortage. Put simply, underlying demand estimates what the demand for newly-built housing might be given the growth in population, trends in household size, demand for second (or holiday) homes, and economic conditions (e.g. employment,

44

The boom & bust of British housing

By Leith van Onselen In Monday’s PowerPoint Presentation on Housing supply & price volatility, I included a chart showing the extreme price volatility of housing in the UK, where prices have experienced four boom and bust cycles since 1970. (see next chart). As noted previously, tight planning restrictions have been in place in the UK

156

Sweden shows Australia the way out

By Leith van Onselen Sweden’s housing market shares a lot of simularities with Australia. As was the case in Australia, Sweden’s financial system was deregulated in the mid-1980s, which led to a house price boom and then corrrection as the Swedish economy entered recession in the early-1990s. However, whereas Australia’s banking system was almost brought

63

Supply-side squeezes UK first home buyers

By Leith van Onselen Earlier this week, the UK Government released its English Housing Survey 2011 to 2012, which provided some sobering data about the situation facing first home buyers (FHBs). According to the Survey, the rate of home ownership has slumped to 65.3%, which was the seventh consecutive yearly fall and represented the lowest

89

Texas wins on housing

By Leith van Onselen Trulia yesterday 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 2011, 562,000

35

NZ steps-up rhetoric on housing market

By Leith van Onselen In recent weeks, I have described how New Zealand’s authorities have become increasingly vocal on the issue of housing affordability as well as the macroeconomic risks posed by New Zealander’s seemingly insatiable appetite for housing and high levels of mortgage debt. Late last week, the new minister for Housing, Nick Smith,

48

Kiwis pile back into property

By Leith van Onselen Bernard Hickey from Interest.co.nz  has previously joked that the New Zealand economy was not an economy but a “housing market with a few other things tacked on”. And to be frank, Bernard has a point. A few years back, the IMF released the below charts showing that New Zealand had the

15

US house prices lift. But for how long?

By Leith van Onselen Earlier this week, the 20-city Case-Shiller house price index was released for the month of November 2012, which revealed a seasonally-adjusted 0.6% rise in values and a 5.6% increase over the year (see next chart). The annual rise in home values was the biggest since January 2008, and combined with the

47

Is NZ getting serious on housing policy?

By Leith van Onselen This time last week I described how the release of the 9th Annual Demographia International Housing Affordability Survey had caused a political storm in New Zealand, with both major parties promising to tackle the issue of housing affordability via reforms to housing supply. On Friday, New Zealand’s Prime Minister, John Key,