Politics 🗳️ NZ Politics

[MrFrankWhite]

Verrall says Reti's false chart makes PM Luxon 'look like an idiot' over Health NZ claims

Shane Reti's office has admitted a chart referred to in press conference does not exist.

www.nzherald.co.nz

Shane Reti’s office admits chart used to justify $1.4b Health cuts ‘does not exist’
Thomas Coughlan
By Thomas Coughlan
Deputy Political Editor·NZ Herald·
5 Sep, 2024 05:42 PM
4 mins to read
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Prime Minister Christopher Luxon and Health Minster Dr Shane Reti announcing the appointment of a commissioner to Health NZ. Photo / Mark Mitchell
Prime Minister Christopher Luxon and Health Minster Dr Shane Reti announcing the appointment of a commissioner to Health NZ. Photo / Mark Mitchell

Health Minister Shane Reti’s office has admitted an organisational chart of Health NZ - Te Whatu Ora, which allegedly proved the organisation had become bloated and inefficient “does not exist”.

Reti used the chart to justify painful spending restraint at Health NZ. He now claims that there was not one organisational chart as initially claimed, but that he was referring to an amalgam of the many Health NZ organisational charts he had seen.

Labour’s health spokesperson Ayesha Verrall told the Herald the invented chart has made Prime Minister Christopher Luxon, who was standing beside Reti when he made the remarks, “look like an idiot”.

“The claims made about Health NZ in July are made up and they used those claims to justify a commissioner and cuts of $1.4 billion to the health system,” she said.

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In July, Reti took to the podium in the Beehive theatrette alongside Luxon to announce Health NZ - Te Whatu Ora was staring down the barrel of a $1.4b deficit thanks to a bloated, inefficient bureaucracy.

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I’m not interested in Political Briefing newsletter. Please don’t show me this again.
The pair announced the Health NZ board had been sacked and Lester Levy had been appointed Commissioner to govern the organisation back to financial health.

To justify his claim of bloated bureaucracy, Luxon said there could be 14 layers of management between the CEO and the patient.

When asked what these layers were, Reti twice referred to a single organisational chart that demonstrated these layers.

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“Look, there’s an org chart which I’ve seen which is just mind-boggling. I could not name the different layers of wayfinders, pathfinders, boundary spanners - Lord knows what else - from A to B. I could not name them for you,” Reti said.

When asked whether he could send the chart to media to prove his claim, Reti said he would approach Levy “to send around the chart and the information we have on that”.

Later, officials did send media a list of 14 management layers. It showed that there were not 14 layers between the CEO and the patient, but 14 layers including the CEO and the patient.

The Herald requested the specific chat Reti had referred to in the press conference under the Official Information Act. The request was finally answered this week, with Reti’s office conceding: “In response to your request, an organisational chart that covers the entirety of Health New Zealand’s structure does not exist”.

Labour's Health Spokeswoman Ayesha Verrall said the remarks had made the prime minister look like an idiot. Photo / Mark Mitchell.
Labour's Health Spokeswoman Ayesha Verrall said the remarks had made the prime minister look like an idiot. Photo / Mark Mitchell.

The office then attached the list of 14 job titles sent to other media.

The Herald asked Reti’s office whether he had been completely truthful when he had claimed to have seen the org chart which does not exist and when he had offered to ask Levy to send the nonexistent chart to media.

A spokesperson replied, “There is no single organisational chart covering Health New Zealand, although there are several org charts of different formats covering different parts of the agency.

“The point the minister made at post cab was focused on a number of ambiguous job titles in health which don’t clearly explain their purpose,” they said.

Verrall told the Herald she had herself asked for organisational charts from Health NZ using written Parliamentary questions. She had requested an organisational chart showing job titles and names of office holders down to tier three, meaning the chief executive, the executive leadership team, and their support staff.

This question was refused because it would have required Health NZ staff to undertake “a substantial manual collation”.

Verrall said she was concerned that the Government had yet to conclusively prove the claims used to justify sacking Health NZ’s board, inserting a commissioner, and beginning a savings exercise. This was concerning because with no board, Health NZ was no longer publishing board minutes which give an insight into how the organisation is performing.

“It matters if those claims can’t be borne out. There’s no 14 layers of management, there’s no organisational chart, the cost was not due to back-office start but due to nursing hiring. So much of what the Government built its case on has been shown to be untrue,” she said.

“New Zealanders have a right to know if these cuts are justified. The Government has had one press conference and hasn’t made the case. It has asserted there are financial problems at Health NZ. They have not released any documents to show that is the case.”

Thomas Coughlan is Deputy Political Editor and covers politics from Parliament. He has worked for the Herald since 2021 and has worked in the press gallery since 2018.

This isnt the beat up you thought it was going to be. We know the Govt is incompetent, now Health NZ looks it too.

Verrall told the Herald she had herself asked for organisational charts from Health NZ using written Parliamentary questions. She had requested an organisational chart showing job titles and names of office holders down to tier three, meaning the chief executive, the executive leadership team, and their support staff.

This question was refused because it would have required Health NZ staff to undertake “a substantial manual collation”.

 

[MrFrankWhite]

These comparisons are meaningless.
It goes to show that peoples decision to live somewhere are not dictated by affordability, other factors hold more weight.
You would think that the motorways leaving Auckland would be blocked by people leaving in search of cheaper housing. They aren't, very few leave for that reason and are quickly replaced.

Yeah immigration my guy

 

[miket12]

These comparisons are meaningless.
It goes to show that peoples decision to live somewhere are not dictated by affordability, other factors hold more weight.
You would think that the motorways leaving Auckland would be blocked by people leaving in search of cheaper housing. They aren't, very few leave for that reason and are quickly replaced.

Except they aren't an indication of why people have entered or left an area but the cost of leaving there.

 

[miket12]

I've been given a bit of thought lately to retirement (you do that when you're getting closer to it!!!) and I think KiwiSaver and the government contribution each year of just over $500 for $1,000 contributed by the person with the KiwiSaver account is fundamentally wrong... it's providing a handout to those who, in a lot of cases, don't need it while not giving it to those who, IMO, need it far more.... children under 18.

Here's my thoughts.... still have the same government contribution on balances up to $100,000 then reduce the government contribution by 20% for $10,000 bands until someone with a KiwiSaver balance over $150,000 doesn't receive any government contribution, but use the money the government otherwise would have used to give these people, to go into the KS accounts of children. When a child is born and a birth certificate issued, the public trust starts up a KS account in that child's name with a default KS provider and the government puts in the $1,000 joining fee it's currently doing. The money the government doesn't contribute into the accounts of those with balances over $100,000 is then evenly distributed into the accounts of all the kids in NZ.

Then, 10% of any working for families tax credit per child gets put into that child's KS account. So, if a family with two children was to receive a WFTC of $4,000 PA, divide that by two for each child and $200 would be paid into each child's KS account for that year. 10% of any court ordered child maintenance could be paid into the child's/children's KS accounts.

At 18, the account gets passed on by the Public Trust and the child takes over it themselves. Even if they never contribute another cent over their working lives into the KS account, compounding interest of 5% after fees and taxes (provided a government doesn't introduce a CGT to eat 28% of the returns) and every 15 years (until 63) and the balances doubles. That means if a child had $15,000 in their KS account when they turned 18, without contributing to it, that balance would be over $120,000 when they retired (if the average return was 5%).

 

[MrFrankWhite]

I've been given a bit of thought lately to retirement (you do that when you're getting closer to it!!!) and I think KiwiSaver and the government contribution each year of just over $500 for $1,000 contributed by the person with the KiwiSaver account is fundamentally wrong... it's providing a handout to those who, in a lot of cases, don't need it while not giving it to those who, IMO, need it far more.... children under 18.

Here's my thoughts.... still have the same government contribution on balances up to $100,000 then reduce the government contribution by 20% for $10,000 bands until someone with a KiwiSaver balance over $150,000 doesn't receive any government contribution, but use the money the government otherwise would have used to give these people, to go into the KS accounts of children. When a child is born and a birth certificate issued, the public trust starts up a KS account in that child's name with a default KS provider and the government puts in the $1,000 joining fee it's currently doing. The money the government doesn't contribute into the accounts of those with balances over $100,000 is then evenly distributed into the accounts of all the kids in NZ.

Then, 10% of any working for families tax credit per child gets put into that child's KS account. So, if a family with two children was to receive a WFTC of $4,000 PA, divide that by two for each child and $200 would be paid into each child's KS account for that year. 10% of any court ordered child maintenance could be paid into the child's/children's KS accounts.

At 18, the account gets passed on by the Public Trust and the child takes over it themselves. Even if they never contribute another cent over their working lives into the KS account, compounding interest of 5% after fees and taxes (provided a government doesn't introduce a CGT to eat 28% of the returns) and every 15 years (until 63) and the balances doubles. That means if a child had $15,000 in their KS account when they turned 18, without contributing to it, that balance would be over $120,000 when they retired (if the average return was 5%).

1. great idea, this thinking is doing the rounds in Aus.
2. the public trust is a giant fucking scam and all it is good at is feeding itself fees

 

[miket12]

1. great idea, this thinking is doing the rounds in Aus.
2. the public trust is a giant fucking scam and all it is good at is feeding itself fees

I'm thoughts about using the Public Trust is that there is then a compulsory element to it and you aren't relying on the parents.... while most would, there's a low percentage who just wouldn't. And, to be honest, those kids are probably the ones who would actually need it the most. Plus, using the PT, also keeps it out of the government hands.

 

[MrFrankWhite]

I'm thoughts about using the Public Trust is that there is then a compulsory element to it and you aren't relying on the parents.... while most would, there's a low percentage who just wouldn't. And, to be honest, those kids are probably the ones who would actually need it the most. Plus, using the PT, also keeps it out of the government hands.

Any large institution becomes beholden to itself over time.

 

[miket12]

Better times ahead? Key economic indicator turns positive for first time in two years​

New Zealand’s yield curve, seen as an indicator of things to come, has turned positive for the first time in just over two years.

A negative or inverted curve, when short-term wholesale interest rates are higher than long-term rates, reflects a difficult outlook and is seen as offering an early warning of a recession.

On the other hand, an upwardly sloping curve can imply stable economic conditions and a normal economic cycle.

A steeply sloping curve signals strong economic growth, accompanied by inflationary pressures that normally go with that, driving longer term yields higher.

In New Zealand’s case, the curve started going positive in early August, due mostly to falls in the short end of the curve – moves later reinforced by a 25 basis point cut in the Reserve Bank’s official cash rate to 5.25% on August 14.

But if the Reserve Bank cuts the official cash rate by another 75 basis points before Christmas, as market pricing points to, the yield curve can be expected to steepen further, analysts said.

Kiwibank chief economist Jarrod Kerr said a positive yield curve was a sign of two things.

“One, it is a signal that the Reserve Bank is cutting interest rates but it’s also a signal that the markets are getting more confident about the long term, and are starting to price in a bit more growth and inflation,” he said.

“The yield curve is likely to steepen up further and become more positive, as more rate cuts are delivered, and the long end will hold or lift a bit with better growth and higher inflation expectations.”

In the wholesale interest rate market, two-year swaps traded on Friday at 3.79% while 10-year swaps were at 3.91%.

“Short-end rates are falling faster than long-end rates, so that’s a positive,” Kerr said.

New Zealand’s previously inverted yield curve had proven an accurate early warning system for recessions.

“We have been through that recession now and we are now seeing it turn positive,” Kerr said.

“People have been jolted out of their ‘survive to 25′ mentality, and are a lot more growth-oriented in their discussions, which is good,” Kerr said.

But Harbour Asset Management fixed income and currency strategist, Hamish Pepper, warned of the perils of reading too much into the shape of yield curves.

“While an inverted yield curve signals a recession and a positive slope is something that signals better times, I think where we have got to is that it probably matters how the curve is becoming positively shaped,” Pepper said.

“If you have got short-term interest rates responding to easing cycles and anticipated easing cycles that are reflecting very weak economic conditions, then it’s not necessarily telling you that things are great,” he said.

“You need a caveat there as to why the curve is upwardly sloping.

“This big drop in the two-year swap rate over the last two to three months is telling you that something is quite wrong here.”

Pepper said there was tension between the “soft” economic data, such as confidence surveys, and hard economic statistics.

He pointed to ANZ’s latest survey, which showed business confidence increased to the highest level in a decade in August.

Then there was the release of retail sales data for the June quarter showing a 1.2% fall against the March quarter.

“I think that with the soft data, there is a good chance that it will improve, and might even flow through into hard data over the summer,” Pepper said.

Pepper’s reluctance to celebrate a positive curve is mirrored overseas.

The Financial Times noted last week that short-term US Government borrowing costs have fallen below long-term costs.

The yield on the rate-sensitive two-year Treasury fell below that of its 10-year counterpart on Thursday, after data showed the US private sector added the fewest jobs in three and a half years in August.

An inverted yield curve has historically been seen by some investors as an indicator of a recession, even though it has not always proved accurate, the FT said.

The US bond market has been sending this signal almost continuously for the past two years.

However, investors and strategists are split on what the ending of this inversion – driven by investors increasing their bets on rapid interest rate cuts in recent weeks – might mean.

“It’s tempting to suggest we can sound the all-clear” on the economy but ‘we’re not out of the woods yet’,” Deutsche Bank strategist Jim Reid told the FT.

ANZ Bank strategist David Croy said the New Zealand market had seen the first phase of a steepening yield curve through lower short-term rates.

The key from here on in would be how the long end of the yield curve responds, he said.

Jamie Gray is an Auckland-based journalist, covering the financial markets and the primary sector. He joined the Herald in 2011.

Key economic indicator turns positive in NZ for first time in two years

An upwardly sloping NZ yield curve is jolting people out of a 'survive to 25' mindset.

www.nzherald.co.nz

Actually, it depends on whether you're a glass half full or glass half empty to whether you should read too much into this movement. Me, I tend to think we'll need a lot sharper yield return to really consider that we've "turned the corner". To me, it indicates a tiny movement and an indication things will get better and, as Hamish Pepper said in the article, “You need a caveat there as to why the curve is upwardly sloping."

 

[miket12]

I think most homeowners didn't expect to see the extremely low interest rates again which occurred before COVID but this article explains why.... and it's all to do with the Reserve Bank settings....

Mark Lister: Reserve Bank signals lower interest rates, but mortgage relief may be limited​

THREE KEY FACTS

• Interest rates are expected to decrease, but mortgage rates may not drop as much as anticipated
• The Reserve Bank projects the OCR to settle around 3% by early 2027
• Borrowers should prepare for mortgage rates of around 5%, reflecting a new normal for borrowing

Mark Lister is investment director at Craigs Investment Partners.
Interest rates are headed lower, which will take the pressure off household budgets and give borrowers a reprieve.

The bad news is that they might not fall quite as much as some are hoping.

With that first rate cut under its belt, the Reserve Bank has several more in the pipeline.

Its projections suggest the Official Cash Rate (OCR) will keep falling from here, and settle at about 3% by early 2027.

Financial markets also expect the policy rate to land at those levels, although they see it getting there a little sooner.

The OCR is like the Reserve Bank’s brake or accelerator pedal, and its key tool to influence activity and inflation.

The “neutral OCR” is the level where the economy is in balance, and it isn’t being sped up or slowed down.

It’s difficult to pinpoint exactly where this tipping point is, but it’s an important concept for policymakers and the rest of us.

Historically, the Reserve Bank has thought it to be about 2%, in line with its inflation target.

Ignoring the pandemic and its aftermath, that’s roughly where the OCR has averaged in recent years.

In the decade preceding Covid, the OCR fell as low as 1% and pushed as high as 3.5%.

It averaged 2.3% over the entire period and spent eight of those 10 years below 3%.

Today, the Reserve Bank believes the long-term neutral level of the OCR is 2.8%, up from 2.3% a year ago and above the historical estimate of 2%.

It’s not alone.

The Federal Reserve in the US has also been revising its estimate of the long-run policy rate higher.

It sees it at 2.8% as well, compared with 2.5% at the beginning of the year.

Economists can’t precisely calculate where neutral is at any given time, but most experts agree it’s higher than it used to be.

Globalisation moving into reverse, higher government debt, demographics and climate change action have been contributing factors.

For the typical homeowner, the upshot is that mortgage rates might not fall quite as much as they’d like.

Over the past several years one and two-year mortgage rates have been, on average, 2.3 and 2.4% above the OCR.

This gap widened during the ultra-low interest rate Covid period, while it’s been much narrower since the OCR pushed above 5% last year.

Where it goes in the coming years will depend on several factors, including how competitive the mortgage market gets.

However, history would suggest borrowing rates for these popular mortgage terms will be about 2% higher than the OCR, give or take.

Financial markets see the OCR falling to 4% by April 2025, which implies mortgage rates of about 6%.

Two years from now, it is expected to have reached its 3% nadir, which implies mortgage rates of about 5%.

That’s a big fall from the 7%-plus peak, but it’s well above that of the crazy Covid era as well as the four years before that.

If 5% is indeed as good as it gets, the coming period will more closely resemble the post-GFC years of 2009 to 2015.

Back then, the OCR oscillated within a range of 2.50 and 3.50% and it averaged 2.75%, almost bang on the latest estimate of where neutral is.

Over those seven years, the one-year mortgage rate averaged 5.1%.

It’s true, interest rates are headed lower and borrowers are right to feel more upbeat, optimistic and encouraged about what’s ahead.

However, don’t get ahead of yourself. If the neutral OCR is higher than it used to be, the “new normal” for mortgage rates will be too.

Opinion: Bad news - mortgage rates might not fall as much as you’re hoping

OPINION: OCR projected to drop to about 3% by early 2027, impacting future mortgage rates.

www.nzherald.co.nz

 

[Noitall]

I think most homeowners didn't expect to see the extremely low interest rates again which occurred before COVID but this article explains why.... and it's all to do with the Reserve Bank settings....

Mark Lister: Reserve Bank signals lower interest rates, but mortgage relief may be limited​

THREE KEY FACTS

• Interest rates are expected to decrease, but mortgage rates may not drop as much as anticipated
• The Reserve Bank projects the OCR to settle around 3% by early 2027
• Borrowers should prepare for mortgage rates of around 5%, reflecting a new normal for borrowing

Mark Lister is investment director at Craigs Investment Partners.
Interest rates are headed lower, which will take the pressure off household budgets and give borrowers a reprieve.

The bad news is that they might not fall quite as much as some are hoping.

With that first rate cut under its belt, the Reserve Bank has several more in the pipeline.

Its projections suggest the Official Cash Rate (OCR) will keep falling from here, and settle at about 3% by early 2027.

Financial markets also expect the policy rate to land at those levels, although they see it getting there a little sooner.

The OCR is like the Reserve Bank’s brake or accelerator pedal, and its key tool to influence activity and inflation.

The “neutral OCR” is the level where the economy is in balance, and it isn’t being sped up or slowed down.

It’s difficult to pinpoint exactly where this tipping point is, but it’s an important concept for policymakers and the rest of us.

Historically, the Reserve Bank has thought it to be about 2%, in line with its inflation target.

Ignoring the pandemic and its aftermath, that’s roughly where the OCR has averaged in recent years.

In the decade preceding Covid, the OCR fell as low as 1% and pushed as high as 3.5%.

It averaged 2.3% over the entire period and spent eight of those 10 years below 3%.

Today, the Reserve Bank believes the long-term neutral level of the OCR is 2.8%, up from 2.3% a year ago and above the historical estimate of 2%.

It’s not alone.

The Federal Reserve in the US has also been revising its estimate of the long-run policy rate higher.

It sees it at 2.8% as well, compared with 2.5% at the beginning of the year.

Economists can’t precisely calculate where neutral is at any given time, but most experts agree it’s higher than it used to be.

Globalisation moving into reverse, higher government debt, demographics and climate change action have been contributing factors.

For the typical homeowner, the upshot is that mortgage rates might not fall quite as much as they’d like.

Over the past several years one and two-year mortgage rates have been, on average, 2.3 and 2.4% above the OCR.

This gap widened during the ultra-low interest rate Covid period, while it’s been much narrower since the OCR pushed above 5% last year.

Where it goes in the coming years will depend on several factors, including how competitive the mortgage market gets.

However, history would suggest borrowing rates for these popular mortgage terms will be about 2% higher than the OCR, give or take.

Financial markets see the OCR falling to 4% by April 2025, which implies mortgage rates of about 6%.

Two years from now, it is expected to have reached its 3% nadir, which implies mortgage rates of about 5%.

That’s a big fall from the 7%-plus peak, but it’s well above that of the crazy Covid era as well as the four years before that.

If 5% is indeed as good as it gets, the coming period will more closely resemble the post-GFC years of 2009 to 2015.

Back then, the OCR oscillated within a range of 2.50 and 3.50% and it averaged 2.75%, almost bang on the latest estimate of where neutral is.

Over those seven years, the one-year mortgage rate averaged 5.1%.

It’s true, interest rates are headed lower and borrowers are right to feel more upbeat, optimistic and encouraged about what’s ahead.

However, don’t get ahead of yourself. If the neutral OCR is higher than it used to be, the “new normal” for mortgage rates will be too.

Opinion: Bad news - mortgage rates might not fall as much as you’re hoping

OPINION: OCR projected to drop to about 3% by early 2027, impacting future mortgage rates.

www.nzherald.co.nz

While I think a return to those low rates would stimulate the market, I think it could just see a return to the situation we’re in in time being that those rates were always unsustainable. I agree with your point I’ve seen on here before about paying that bit extra on your repayments when seeing those low rates. Those low rates essentially created a false economy that when those hefty rates rises came in, many were stranded unable to pay the adjusted rates

 

[juju]

Treaty Principles Bill: 440 Christian leaders sign open letter asking MPs to vote no

Religious organisation says the Treaty of Waitangi is a covenant, and "we believe God takes covenants seriously".

www.rnz.co.nz

View: https://x.com/dbseymour/status/1832879273453273227?ref_src=twsrc%5Egoogle%7Ctwcamp%5Eserp%7Ctwgr%5Etweet

 

[miket12]

Treaty Principles Bill: 440 Christian leaders sign open letter asking MPs to vote no

Religious organisation says the Treaty of Waitangi is a covenant, and "we believe God takes covenants seriously".

www.rnz.co.nz

View: https://x.com/dbseymour/status/1832879273453273227?ref_src=twsrc%5Egoogle%7Ctwcamp%5Eserp%7Ctwgr%5Etweet

Seymour lives in La-La-Land.... people questioning what our leaders are doing IS a sign of democracy at work.... blindly obeying our leaders is a sign that democracy has been replaced by authoritarianism.... the very opposite of freedom of speech he keeps saying ACT is all for.

They have every right to sound off against what he's saying.... just as all those on his side have the right to speak out.

He might not agree with them but it's part of a healthy democracy.

Funny how, in his mind, he'll play the "separation between church and state" card when it suits him but Trump is relying on the church to get him back into leading the state. Hippocrates on the right, Hippocrates on the left.... it's really hard to keep up sometimes!!!

 

[miket12]

While I think a return to those low rates would stimulate the market, I think it could just see a return to the situation we’re in in time being that those rates were always unsustainable. I agree with your point I’ve seen on here before about paying that bit extra on your repayments when seeing those low rates. Those low rates essentially created a false economy that when those hefty rates rises came in, many were stranded unable to pay the adjusted rates

I think most people, especially first home buyers, don't really consider the impact rising interest rates (and/or falling house prices) will really have on them. For most, it's only when the first rise that affects them happens that they see the reality of the situation. With time, most will develop the resources to deal with them.... but the lessons can be harsh if you're not prepared.

Since 1998, the average two-year fixed interest rate has been 6.74% so the current BNZ rate of 5.89% is actually below average. Since 1998, the highest rate was in June 1998 at 9.89% while the lowest was in November 2020 at 3.50%. While the last few years have been hard, they haven't actually been that far above the historical average..... which doesn't really help you when your mortgage rate changes and you've payments have increased $10,000's because of the rises in interest.

 

[juju]

I think most people, especially first home buyers, don't really consider the impact rising interest rates (and/or falling house prices) will really have on them. For most, it's only when the first rise that affects them happens that they see the reality of the situation. With time, most will develop the resources to deal with them.... but the lessons can be harsh if you're not prepared.

Do we think house prices will drop significantly here realistically?

And how low do we think mortgage rates will go again.

Seems like it will be a bit of a period of stagnant house price rises and mortgage rates hovering between 5 - 6%?

 

[miket12]

Do we think house prices will drop significantly here realistically?

And how low do we think mortgage rates will go again.

Seems like it will be a bit of a period of stagnant house price rises and mortgage rates hovering between 5 - 6%?

When I was studying, a lecturer suggested that there's around a seven-to-ten-year cycle between highs down to the lows and back to the highs.

Personally, I think rates won't drop as far but because of the lack of supply in the market (builders and developers just aren't currently building enough stock), values will go up.

If you are a first home buyer, and can afford the higher interest rates for six months, I'd go now before FOMO rears it's ugly head again and prices start going up again.

 

[Noitall]

I think most people, especially first home buyers, don't really consider the impact rising interest rates (and/or falling house prices) will really have on them. For most, it's only when the first rise that affects them happens that they see the reality of the situation. With time, most will develop the resources to deal with them.... but the lessons can be harsh if you're not prepared.

Since 1998, the average two-year fixed interest rate has been 6.74% so the current BNZ rate of 5.89% is actually below average. Since 1998, the highest rate was in June 1998 at 9.89% while the lowest was in November 2020 at 3.50%. While the last few years have been hard, they haven't actually been that far above the historical average..... which doesn't really help you when your mortgage rate changes and you've payments have increased $10,000's because of the rises in interest.

Probably not, but first home buyers really should consider the impact of rising interest rates because it’s seen many of them see disastrous outcomes in losing their homes to mortgagee sales that some never recover from. The rising rates costs are further costs that households are having to account for with wages not seeing the rises that some are needed to service these extra costs. Before taking on a mortgage if it’s not being considered by first home buyers, there really needs some educating on it. I think you need to be so aware of so many factors, not just locally but internationally as markets can be so fickle. Even knowing what fixed terms and floating rates to go for as being fixed when rates are falling can see decent adjustments missed out on while waiting to come unfixed

 

[dean]

When I was studying, a lecturer suggested that there's around a seven-to-ten-year cycle between highs down to the lows and back to the highs.

Personally, I think rates won't drop as far but because of the lack of supply in the market (builders and developers just aren't currently building enough stock), values will go up.

If you are a first home buyer, and can afford the higher interest rates for six months, I'd go now before FOMO rears it's ugly head again and prices start going up again.

FOMO is balanced against fear of losing your job or business and that is still happening.
I would wait for either a very good buy or something I really wanted and could afford and be prepared to look long and hard.
I know there are loads of new terraced houses complete and for sale and they are not selling. Plenty of consented developments on hold, not enough presales.
My stepson and partner purchases a unit , one of two on the North Shore a year ago for $850k. They are looking to sell and have just had an appraisal $750-$800k, plus of course the agents fees.

 

[MaybeTop8]

Seymour lives in La-La-Land.... people questioning what our leaders are doing IS a sign of democracy at work.... blindly obeying our leaders is a sign that democracy has been replaced by authoritarianism.... the very opposite of freedom of speech he keeps saying ACT is all for.

They have every right to sound off against what he's saying.... just as all those on his side have the right to speak out.

He might not agree with them but it's part of a healthy democracy.

Funny how, in his mind, he'll play the "separation between church and state" card when it suits him but Trump is relying on the church to get him back into leading the state. Hippocrates on the right, Hippocrates on the left.... it's really hard to keep up sometimes!!!

It would be fantastic if we had more Hippocrates. We need them. Libertarian hypocrites on the other hand, no thanks.

 

[MaybeTop8]

Act certainly doesn't believe in free speech when it comes to selling out to the gun lobby - https://www.1news.co.nz/2024/09/08/officials-raise-alarm-after-mckee-makes-rapid-gun-law-change/

 

[MaybeTop8]

Newsflash: Libertarian free speech union objects to free speech -