Real estate boss Peter Thompson doesn't see house prices falling in the short term.
Home owners and buyers will experience little change in the Auckland property market over the next 18 months, with prices holding up, says Barfoot & Thompson managing director, Peter Thompson.
"We still have a shortage of homes, interest rates are low and migration to the city will continue — the factors for wanting to buy property are still there," he says.
Thompson says economists and media view the market over a month rather than taking it out to a 12-month period. Over the past year there has been little movement in prices — up .02 per cent.
"They haven't gone down and over the next 18 months you'll see something similar. Once apartment projects are completed people will have more choice and prices may reduce a little.
"Interest rates are likely to remain at current levels for the next two years — unless something globally goes wrong. But people see New Zealand as a safe haven and will come here for the living environment," says Thompson.
He accepts there's been a slowdown in the market, but he says extending the bright-line test and introducing loan-to-value restrictions have had little impact. "The big one is the Chinese Government changing policy on how much money residents can take out of the country."
Thompson says KiwiBuild is working in the right direction to make housing more affordable — "that's what we need for our future." His company is marketing the first KiwiBuild development at McLennan Park, Papakura with 12 three-bedroom and six four-bedroom homes selling for $549,000 and $615,000 respectively.
"'We had 500 people through on the first day," he says. "They could see they are being given the opportunity of getting into a modern, well-built first home. There were people from Palmerston North, Papamoa, Hamilton and North Shore happy to be part of it.
"[House] prices around the country have gone up while Auckland has been stable for six months. The rest of the country is catching up and it's not quite as enticing moving to the provinces."
Thompson says the costs and time taken to obtain resource consents is the biggest handbrake for all future building. The way consents are managed by council needs total revamp with urgency.
"Council needs to create a simpler process. Instead of having to put in five or six applications (after providing further details), why doesn't council tell the builder what information they want and get it done with one application. And the number of inspections can be tightened up to one rather than three."
Thompson says additional bureaucracy costs were eating into company profits. "First we had the Health and Safety Bill and now we have the Anti-Money Laundering Bill covering more businesses.
"It's going to cost. All three of us — real estate firms, lawyers and banks — will be doing searches and there will be a lot of duplication for one transaction."
Thompson says real estate is a stressful profession — "we do see a lot of personal situations" — and Barfoot & Thompson is planning to introduce a wellness programme with guidance from Sir John Kirwan.
"We do need to look at how our people adapt to change and how they can have a better life. We are a family firm with family values and we are taking these values to another level," he says.
Peter Thompson's Top Three Issues
• A global disaster that puts everyone on alert
• Making enough profit after the additional costs being applied to business today