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Scroll down to view real estate and property-related articles which have appeared in the country’s foremost news media over the past month. You’ll also see commentary from Bayleys managing director Mike Bayley, along with financial research and analysis from highly influential ANZ chief economist Cameron Bagrie.

Waiting for the Government’s announcement on possible new tax implications for property investors was akin to waiting for a tsunami to wash up on our shores….. everyone knows about it, no-one knows exactly what size it would be, everyone holds their breath until it hits - and when it does, nothing much happens - then several hours later, it’s back to ‘life as usual’.

Months of speculation and crystal ball gazing, while making for great debate or commentary, barely amounted to a ripple on the property market. It did however, apply the brakes to the lower value end of the market, to create a ‘wait and see’ period. This compounded the usually slower trading levels seen throughout New Zealand in January and into February, as outlined by the article in NBR below, as most of the country was still on holiday, or busy enjoying summer.

Mike Bayley

Seasoned residential and commercial investors alike, while interested in what the Prime Minister had to announce, were not, I suggest, ‘overly nervous’. While hyped up for headlines sake, there was never really the option of introducing a wide-sweeping property gains tax. And the thought of removing the ability to transfer investment losses into a Loss Attributing Qualifying Company (LAQC) would also struggle to find support among the Government’s previous middle-ground voters who hold property investments.

With batteries recharged from what has been an enjoyable summer for most of the country, the property market is now starting to gather momentum again as the wheels of commerce build up a head of steam. This will be helped by one of the fundamental drivers of property demand – immigration – with NBR reporting below that migration numbers have hit a six-year high.

So what’s going on in New Zealand’s real estate world….?

Most of the residential market – with investors now aware of Government’s intentions for tax reform – is meandering along as would be expected in a recovering economy. Normally, February sees sales volumes begin to pick up. I say ‘most’ of the market, as interestingly, higher value homes in the $2million - $3million+ range in Auckland and Wellington have seen a resurgence in buyer interest this year – with Bayleys sales consultants completing a number of deals in this sector.

However for most New Zealanders, this year, as with last year, will be unlike any seen in recent history as the New Zealand and global economies recover. This is uncharted territory, and recovery, I suggest, will be gradual.

Similarly, the commercial sector is shifting into second gear as investors pay greater credence to lease terms and tenant security. Again, this is reflective of a gradual recovery rather than a ‘bust/boom’ curve.

The rural sector however, is still at the mercy of closer scrutiny by lending institutions – as evidenced in the editorial featured below through scoop.co.nz. This is important to note, because when the rural sector is pumping, so too is the rest of New Zealand. Such is the importance of revenues generated from one of New Zealand’s biggest industrial sectors.

Medium and long term indices are showing greater positivity – with the ANZ’s latest commodity price index as seen on interest.co.nz linked below - showing a strengthening in lamb prices in the UK, skin and beef prices up to their highest levels since September 2008, wool prices up substantially, log prices on a 14-month high, and seafood on a nine-month high.

Further benefit from these trade stats’ is currently being stifled by the NZ$ remaining at historically high levels against the £British and the Euro – again lending potential impetus to further upsides in the commodity sector.

It will only be a matter of time until the former categories of these indices begin to help loosen the tight grip from the banks and financial houses on the rural sector.

Highest January month migration gain in six years
NBR
The number of people arriving permanently or long term in this country exceeded the number of departures by 2500 in January, the highest net gain for a January month since 2004. [Click here]

Record year for forced property sales
National Business Review
The number of forced sales in New Zealand last year reached the highest levels since records began, with an average of more than eight mortgagee sales every day. [Click here]

Residential consents fall 2.8%, commercial plummet 39%
National Business Review
The latest Statistics New Zealand research shows the number of residential buildings issued with consent in January rose, but only by less than 1%, if apartment consents aren’t counted.[Click here]

Commodity prices near record highs in NZ dollar terms, ANZ index show

interest.co.nz  
Commodity prices rose 7.9% to near record highs in February as most commodity prices rose in US dollar terms and the New Zealand dollar softened over the month, the ANZ Commodity Price Index found. Here is the full release from ANZ: The ANZ Commodity Price Index lifted a further 3.8 percent in February 2010. [Click here]

Uncertainty weighs on softening housing market
National Business Review
Confidence in the New Zealand housing market, which recovered in 2009, is showing signs of softening again, according to a survey of the three months to January. [Click here]
 

Property For Industry raises operating profit slightly, reduces revaluation loss
Bob Dey Property Report
Property For Industry Ltd increased its net after-tax operating profit for distribution by 1.4% for the December year, but recorded a $12.5 million bottom-line loss after revaluations & other non-cash adjustments. [Click here] 

To read ANZ bank's latest in-depth financial analysis of the state of New Zealand's property market, with commentary from chief economist Cameron Bagrie, [click here].

To view PropertyLIVE archives [click here]