Housing market

What happens and are you concerned to find a rental?

August 2011—Not everybody is in election fever yet. Some people feel the opposite. They are frozen by the news about the housing market and have concerns how to fit the bills after the election. It is ghostly quiet around raising the petrol tax and other nasty increases for filling budget gaps. Thank goodness, using the Internet saves Dollars on petrol, when being on house hunt for finding a rental.

Shortage of housing

How big are gaps in the meantime?

For housing I quote from a newsletter “The building consents for new homes remain low, down 32% in April compared with last year. Also worth noting that residential building activity fell 2.1% in the March 2011 quarter, the third consecutive fall, having dropped 12.4% over the previous two quarters”.

Today (20th Sept 2011) the head line in the news “National rental supply is down 7% on a year ago…” and the headline in business news “Major cities drive drop in rental listings”..

It is not difficult to understand that these figures hit hard New Zealand’s immigration dependence and put stress on population growth.

Why would somebody invest in better housing

when not getting paid?

Odd for landlords is that any business can depreciate business assets for reproduction and wear and tear. Not so for rental businesses. Since April 2011 a rental house cannot be depreciated as business asset. That means no compensation for wear and tear and reproduction. As example for insulating a house, replacing old windows with double glazing, etc the investors don’t get paid. Passing on these costs as rent is not an option if the tenant disagrees. Who then will invest in better housing?

A shortage of housing and the rental property crisis for years ahead would not only make those people unhappy who are looking for a place to live, it will have a huge impact on the economic recovery for many reasons;

· Building houses creates jobs

· Good jobs bring taxable income and money to families and local communities

· Encouraged immigrants boosting the economic growth

· Consumers pay for business recovery, and so on

If you start adapting to that situation you will need to think outside the square.

· Instead of buying a new car — how about investing in a solar hot water system? Green tax and electricity costs could be the next big hit.

· How much can you save when preparing a vegetable garden?

· The high Dollar exchange rate is a risk factor for exporters- are you concerned about losing your job?

· How much could you save when taking health and fitness more seriously?

I don’t want to scare you. I wouldn’t feel bad either when being wrong. But if you are concerned — challenge your brain. The good life needs to be managed well.

Stay warm this winter.

Klauster

Internet Advertising Investing

Shortage of housing, rental property crisis, what happens in the housing market and are you concerned to find a rental? Who does invest in better housing?