Buying a house became an investment in New Zealand coincidently with the passing of the Resource Management Act and all the restrictions on land supply it empowered. Prior to then buy a house was a good idea except if you want to make money because real housing prices in 1993 were the same as in the mid-70s.
Source and notes: Dallas Fed International Housing Database July 2015 – The author acknowledge use of the dataset described in Mack and Martínez-García (2011); real housing prices are nominal housing prices deflated by a personal consumption deflator.
Housing prices rose by 50% in the first few years after the passage of the Resource Management Act. Housing prices doubled again in the last five years of the last Labour Government in New Zealand. With the economic recovery, housing prices increased again by 30% in the last four years or so.
The housing prices charted in deflated above are nationwide figures originally from nationwide nominal data published by the Reserve Bank of New Zealand and Quotable Value. They do not show the even faster growth in housing prices in, example, Auckland, Wellington and Christchurch and stagnant housing prices in declining regions, cities and towns of New Zealand.
Utopia, you are standing in it! 
Recent Comments