Figures from the Reserve Bank of New Zealand show the number of mortgage approvals in the first quarter of 2010 was down a record 30 percent over the same time last year. The overall value of loan approvals fell 25.2 percent to just $578.2 million.
» Home loan approvals take record tumble – NZ Herald, 15th April 2010.
» NZ Housing Bubble said to be on verge of collapse – Who Crashed the Economy?, 8th March 2010.
From the latest figures, NZ property market fell 2% last month.
I am waiting till the Australian market starts doing the same.
But I don’t understand:
Lower amount of mortgages -> Less houses built -> Rental shortages -> Rents up -> Return on property investment up -> property price up?
I don’t understand!
Your assumption above assumes the population rate continues to grow and the average people per household remains the same.
If prices are too high, people will be less likely to move to Australia.
If prices are too high, people will stay at home with the parents for longer or live in share houses.
These two parameters can change.