New Zealand Economy

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Kiwi exodus recession indicator flashes red

By Leith van Onselen Statistics New Zealand has released its permanent & long-term migration figures for September 2015, which revealed that net migration to New Zealand continues to boom: According to Statistics New Zealand: Unadjusted figures showed a record net gain of 61,200 migrants in the September 2015 year. The annual gain in migrants has

1

RBNZ dissects Auckland’s investor bubble

By Leith van Onselen Reserve Bank of New Zealand (RBNZ) analyst, Hayden Skilling, has published an analytical note examining recent housing market trends, which highlights the growing influence of investors in pushing-up Auckland house prices, as well as the impact of RBNZ’s 10% speed limit on high loan-to-value ratio (LVR) lending, which was implemented in

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NZ realty also haven to dodgy foreign funds

By Leith van Onselen Much has been written on this site about Australia’s failure to implement anti-money laundering rules with respect to real estate, which have been sitting in draft form since 2006. Earlier this year, the Paris-based Financial Action Task Force (FATF) applied a blowtorch to Australia’s anti-money laundering (AML) regime, releasing a scathing

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Auckland housing bubble turns nuclear

By Leith van Onselen The Real Estate Institute of New Zealand (REINZ) yesterday released its house price index for September, which posted a massive 4.2% monthly jump in the median Auckland house price to a new record high $771,000, with values also up by 25.4% over the year: Sales volumes in the greater Auckland region

23

TPP prevents NZ from regulating foreign buyers

By Leith van Onselen Thanks goodness Australia has already ‘banned’ foreign investment in established dwellings, because under the Trans-Pacific Partnership (TPP), introduction of such laws would be disallowed. New Zealand’s Ministry of Foreign Affairs and Trade (MFAT) explains: TPP protects investors from foreign governments acting in a grossly unfair or unjust way towards them, discriminating

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“Where have all the Chinese buyers gone?”

By Leith van Onselen Could it be that the Chinese Government’s crackdown on capital flight and corruption, combined with the New Zealand Government’s new rules for property investors, are working to put the clamp on Chinese property investment? Because, as reported in Interest.co.nz today, Chinese buyers appear to have deserted the market: Where have all

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RBNZ sounds the alarm on Auckland housing

By Leith van Onselen After the REINZ reported annual house price inflation of 25% in Auckland (on a stratified median basis) earlier this month, Reserve Bank of New Zealand officials ramped up their warnings, telling Parliament’s Finance and Expenditure Select Committee that Auckland house prices were in “dangerous terrritory” and vowing to rein the market in.

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Kiwi exodus recession indicator continues to flash

By Leith van Onselen Statistics New Zealand last week released its permanent & long-term migration figures for August 2015, which revealed that net migration to New Zealand remained near record highs in seasonally adjusted terms: Moreover, in the month of August, there was a net inward migration of people from Australia of 243 people, whereas

11

Time to short the Kiwi?

by Chris Becker The New Zealand 2nd quarter GDP printed this morning and while we must always be cautious about focusing on this very imperfect indicator, it’s what markets follow and their perceptions of the direction in “growth” that push currencies and stocks. Here are the results and comments from Bernard Hickey at interest.co.nz: The

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RBNZ warns on “dangerous” Auckland housing

By Leith van Onselen After the REINZ reported annual house price inflation of 25% in Auckland (on a stratified median basis), Reserve Bank of New Zealand officials ramped up their warnings, telling Parliament’s Finance and Expenditure Select Committee that Auckland house prices were in “dangerous terrritory” and vowing to rein the market in. From Interest.co.nz: Wheeler

4

RBNZ to cut again

by Chris Becker The Reserve Bank of New Zealand is having its monthly interest rate meeting on Thursday with expectations of a 0.25% cut to the currently 3% OCR all but baked in. This will have important ramifications for the Australian dollar as the August print for unemployment in Australia will be released shortly after on the day.

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RBNZ dissects the Auckland bubble

By Leith van Onselen Deputy Governor of the Reserve Bank of New Zealand (RBNZ), Grant Spencer, yesterday gave an interesting speech on the Auckland housing market, where price growth has been out of control, growing by 24% over the past year: And prices relative to incomes are roughly double that of the rest of New

7

RBNZ targets Auckland specufestors

From Martin North: The Reserve Bank today published a summary of submissions and final policy positions in regards to changes in the Loan to Value Ratio restriction rules (LVRs), and the asset classification of residential property investment loans in the Capital Adequacy Framework. As announced in May, the Reserve Bank is altering existing LVR rules

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S&P downgrades NZ banks on Auckland bubble

A glimpse of the not too distant future here, from Interest.co.nz: Standard & Poor’s has cut its stand-alone credit profiles on New Zealand’s big four banks, and lowered its ratings on some other local financial institutions, due to concern over rising Auckland house prices. S&P has lowered its ratings on seven New Zealand financial institutions. And

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NZ PM pulls an Abbott on housing

By Leith van Onselen Earlier this year, Prime Minister Tony Abbott revealed his true colours in calling for ever-rising house prices: “As someone who, along with the bank, owns a house in Sydney I do hope our housing prices are increasing”… “Millions of Australians have mortgages and the last thing they want to see is the

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RBNZ cuts rates again

By Leith van Onselen As widely expected, the Reserve Bank of New Zealand (RBNZ) has cut the official cash rate by 0.25% to 3.00%, following up on last month’s 0.25% cut, which was the first reduction in more than four years. According to the release accompanying the cut, RBNZ governor, Graeme Wheeler, slated the blame

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Kiwi exodus signalling Australian recession?

By Leith van Onselen Statistics New Zealand has released its permanent & long-term migration figures for June 2015, which revealed that net migration to New Zealand remained near record highs in seasonally adjusted terms: Moreover, net annual migration from New Zealand to Australia hit its lowest level in more than 23-years (since December 1991): According

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NZ PM tied in knots over foreign buyers

By Leith van Onselen I wrote last Tuesday how a political war had erupted after the Labour Party’s housing spokesperson, Phil Twyford, released a large Auckland real estate firm’s data showing that almost 40% of buyers in the three months to the end of April had Chinese names, despite Chinese-New Zealanders making up only 9% of