According to the latest data from the OneRoof Valocity House Value Index, taken at the end of January, property values across the country are up by 0.9 per cent compared to three months ago.
OneRoof’s latest House Price Report showed property values were up quarter-on-quarter in 90 per cent of suburbs nationwide, with the biggest quarterly lifts in Arrowtown, Mataura and Whitford.
Of the 793 suburbs with 20-plus settled sales in the last 12 months, more than 40 per cent saw year-on-year value lifts, reflecting the turnaround in the market.
Rotorua suburbs with more than 20 settled sales in the year ending January 31 included Hamurana, where property values increased by 2.1 per cent in the last three months to $1.23 million.
Western Heights saw the second-highest three-month increase in suburb property value, a difference of 2 per cent.
Rotorua Professionals McDowell Real Estate principal and auctioneer Steve Lovegrove said the post-summer, early autumn season was normally a busy one for real estate.
“The good news for everybody is that prices seem to be mostly stable, certainly not going backwards and probably increasing,” Lovegrove told the Rotorua Daily Post.
“We are starting to see the green shoots of property price increases.”
Lovegrove said there was also a lift in the stock available.
“So buyers do have a little more choice and less need to act urgently. We’re seeing a little bit of lag in decision-making and a significant lift in buyers actively entering the marketplace.”
Lovegrove said there was more competition for properties in the $500,000 to $700,000 value range.
“Anything just below that average price is getting hit quite hard with active buyers, mostly first-home buyers.”
Lovegrove said there was also a trend of people looking to downsize which also saw more buyers looking in the lower price ranges.
“There’s a lot of confidence, a positive vibe and a positive outlook looking forward. We’re not expecting a rapid price increase. We are expecting simply more confidence.”
Tremains central region general manager Stuart Christensen said there was more property coming onto the market.
“More people have decided to make a move. Westpac dropped their interest rates on Friday. All those are encouraging signs,” Christensen said.
“We are seeing an increasing number of people at our open homes. So there’s appetite to come out and a good number of first-home buyers are out there.”
Christensen said first-home buyers did have a window to make their decisions, however, as investors were coming gradually back into the market as well.
“Overall there’s a lot more positivity. It’s a new year. People are out looking for a move whether they are upsizing, downsizing or entering the market for the first time.”
The news comes after New Zealand’s average property value grew just 0.9 per cent in the three months to the end of November to $973,000, as buyers retreated from the market after a busy November and October.
Valocity global chief executive of real estate Helen O’Sullivan said sales volumes in December were lower than had been anticipated, given the lift in October and November, although they were up year-on-year.
Valocity data showed mortgages registered to first-home buyers in the last quarter of the year dipped to 44 per cent from the five-year high of 45 per cent the previous quarter. Mortgages registered to investors increased slightly from 22.4 per cent to 23.6 per cent over the same period.
O’Sullivan said the Reserve Bank’s announcement around debt-to-income ratios was unlikely to have an impact on the current market.
“The proposed settings are not expected to make a significant difference to prices or activity levels in the current high-interest rate environment,” she said.
“When interest rates are lower, [debt-to-income ratios] will limit the level of debt borrowers can assume despite being able to service the debt.”
Maryana Garcia is a regional reporter writing for the Rotorua Daily Post and the Bay of Plenty Times. She covers local issues, health and crime.
Lower home prices and declining interest rates on new fixed-rate mortgages are starting to translate into affordability gains in some Canadian cities, a Globe analysis has found.
While many Canadian cities have seen sizable home price drops over much of 2022 and 2023, soaring borrowing costs over that period have, until recently, wiped out any affordability gains for homebuyers. But with lenders lowering fixed rates on new five-year mortgages over the past two months, that’s beginning to change.
The Globe and Mail compared the mortgage payments homebuyers would have to carry if they purchased an average-priced home in their local market today to what they’d have paid if they’d bought in February, 2022, right before the Bank of Canada began its rate-hiking campaign. In a handful of housing markets, those payments would be lower, the numbers show.
The analysis shows it currently takes a home price decline of around 25 per cent or more from February two years ago to produce a mortgage payment decrease of more than $100 a month.
But the good news for homebuyers is limited. The gains are typically modest and concentrated in mid-sized cities and smaller communities in Ontario, which saw the sharpest housing corrections since early 2022.
And in the absence of sizable increases to the housing supply, any affordability gains are likely to be short-lived, with buyer demand bound to quickly push up prices, CIBC Capital Markets deputy chief economist Benjamin Tal said, commenting on The Globe’s analysis.
“What we’re seeing now is a situation in which we are planting the seeds for some increasing prices down the road,” Mr. Tal said.
The Globe calculated mortgage payments in more than 20 markets tracked by the Canadian Real Estate Association. The analysis relies on estimates of the price of a typical home in February, 2022, and in December, 2023, the latest available data.
To calculate mortgage payments at the peak of the pandemic housing boom, The Globe used a rate of 2.94 per cent. That was the lowest nationally available five-year fixed rate for purchases that don’t require mortgage default insurance in mid-February of 2022, according to MortgageLogic.news.
For an estimate of mortgage payments for today’s buyers, The Globe used a 5.29 per cent rate, the current lowest five-year fixed rate. The calculations assume buyers have a 20-per-cent down payment and will take 25 years to pay off the mortgage.
Those steep price declines are mostly found in Ontario. In Cambridge, for example, where prices have dropped 28 per cent from their peak, a buyer today would likely face monthly mortgage payments around $300 lower for a typical home. Buyers will find similar conditions in London, Waterloo, Hamilton and Oakville.
The province also dominates the ranking of markets where prices have fallen by around 20 per cent, which currently produces mortgage payments that are roughly equal to those buyers faced two years ago, before the central bank began raising rates. Chilliwack, B.C., is the only city outside of Ontario among those analyzed to also exhibit these conditions.
In much of the rest of Canada, buyers are still contending with higher mortgage payments. In Halifax, for example, the monthly payment on a typical home is still roughly $400 higher, even though home prices are 6 per cent lower.
In Calgary, where prices are up 10 per cent since February, 2022, a new buyer would have to shoulder nearly $1,200 more a month in mortgage payments for an average home.
But for many buyers, strong wage growth over the past two years should help soften the financial pinch, said mortgage analyst Robert McLister, who runs MortgageLogic.news.
“You would find that the total affordability is not as bad as it would seem in some places if you factor in that,” Mr. McLister said.
And lower home prices mean down payments can go further to reduce the size of a mortgage and its monthly instalments.
With borrowing costs still elevated, Mr. Tal expects only a modest revival in housing activity this spring. But the affordability gains realized so far are so little that even small price increases would erase them in the absence of further interest-rate declines, he said.
A decade ago, Joe Bladek’s clients typically put down deposits of between $1,000 and $5,000 when making an offer on a new home. Today, the Barrie, Ont.-based mortgage broker said, those deposits are more commonly in the range of $5,000 to $10,000 – and recently, he worked on an offer where the buyer put down a $50,000 deposit and had to ask family for help to scrounge up the funds.
“A lot of clients don’t realize that deposits are quite large these days,” Mr. Bladek said. It’s partly owing to the higher cost of homes themselves, since deposits are typically between 1 to 10 per cent of the sale price. But it’s also a holdover from the pandemic bidding wars, when buyers sought to compete with firm offers. And while deposits come from the down payment, buyers need to have the money on hand.
It’s just one example of how the costs linked to buying and selling a home have crept up over the years, largely because of higher housing prices.
Experts say buyers should typically expect to spend between 1 and 5 per cent of a home’s purchase price on moving and closing costs.
Twenty years ago, if someone were to buy a house at the national average price of $245,149, they would have likely spent between $2,450 and $12,250 to close on their house and to move. At the end of 2023, someone who bought at the national average price of $657,145 would have needed to pay between $6,571 and $32,857 for moving and closing costs.
A statistic used often by the real estate industry, though hardly ever with a citation, says that Canadians move every seven years on average. If true, a hypothetical buyer who moved three times in the past 20 years could have spent a total of between $15,000 and $62,000, roughly, depending on the value of their homes.
In Toronto, where the average house price was $1.126-million at the end of 2023, moving and closing costs would range from $11,260 to $56,300. Now imagine today’s first-time buyers moving multiple times over a lifetime.
Rona Birenbaum, certified financial planner and the founder of Caring for Clients in Toronto, said moving costs can hurt someone’s financial plan in the short term. While she said they’re often not enough to derail someone’s financial picture, “they don’t give you any kind of return on investment; they are absolute expenses,” she said.
“That money that comes out of the client’s financial picture – if it was in the financial picture, it would be compounding. So you lose the compounding on that money, on that wealth.”
Ms. Birenbaum added that in particular for older Canadians, multiple moves later in life can eat into funds that should be earmarked for necessary living expenses and end-of-life care.
For some buyers at the margin, the costs associated with closing on a home and moving house can change the economics of buying.
“They can be very prohibitive,” said Mr. Bladek. “Some clients of mine who’ve come to me wanted to move into a new home and can qualify for that new home, but with all the fees involved and the market the way that it is … can’t make it at the end of the day.”
There are plenty of costs linked to buying or selling a home in Canada, including land transfer tax (in most provinces), lawyer and realtor fees, title transfer and insurance, deposit money, property appraisal fee, home inspection, a status certificate for condo owners, and of course, movers, among others.
The biggest cost for many buyers is the land transfer tax, said Daniel La Gamba, a real estate lawyer and founding partner of LD Law LLP in Toronto. Ontario, Quebec, British Columbia, Manitoba, Nova Scotia, New Brunswick and Prince Edward Island have such taxes, and Toronto homeowners pay double the tax of buyers elsewhere in Ontario. Montreal also has its own land transfer tax.
Land transfer taxes are based on property value and often run in the thousands of dollars, though each province takes a slightly different approach. New Brunswick and Prince Edward Island charge a flat rate of 1 per cent of the purchase price or assessment value; Nova Scotia’s is 5 per cent; the other provinces have marginal tax brackets. While the taxes themselves have remained consistent for years, steadily climbing home prices mean that someone buying today is likely facing a heftier upfront tax bill than they would have in years past.
Mr. La Gamba said that someone buying a million-dollar home in Ontario would pay $16,475, and that amount would increase to $32,950 for someone buying in Toronto.
Sellers also pay the commission for both their agents and the buyer’s, which come to a combined 5 per cent plus sales tax, though Mr. La Gamba noted there is the potential to negotiate.
The cost of moving services themselves also spiked during the pandemic as fuel and labour shortage costs hit local and long-haul movers. According to Statistics Canada, moving company rates increased a whopping 18.9 per cent in the third quarter of 2021, and have continued to post small increases in the years since.
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Global prices of gas and liquefied natural gas (LNG) are expected to remain relatively weak in 2024, with demand subdued due to high storage levels in Europe and Asia and a mild Northern Hemisphere winter, consultancy Wood Mackenzie said on Wednesday.
“Wood Mackenzie has been forecasting lower 2024 prices for much of last year, especially compared to forward curves, amid weak market fundamental expectations,” Massimo Di Odoardo, Vice President of Gas Research at Wood Mackenzie, said.
“Global LNG supply growth will remain limited at 14 million tonnes (Mt), but with Asian LNG demand still weak, competition for LNG is unlikely to heat up,” he added.
LNG prices dropped 58 per cent in 2023 to levels slightly below $12 per million British thermal units (mmBtu) and fell further in the first two weeks of January to $10.025 on Wednesday, their lowest level since June 2023.
In Europe, gas prices have fallen 45 per cent to $10/mmBtu in the past three months, the report said, expecting market sentiment for gas and LNG to remain bearish into 2024.
Gas demand in Europe fell by 7 per cent in 2023 as mild weather reduced consumption, the report said.
“Normal weather dynamics and a possible economic rebound would support demand, however with renewable supply increasing by more than 100 terra watt hours and nuclear production in France continuing to come back, European gas demand will remain flat at best.”
In Asia, demand this year is expected to grow by 12.5 million metric tons, or 5 per cent from 2023, but remains 3 million tons lower than its 2021 levels.
On LNG contracting, Di Odoardo said overall activity is expected to soften in 2024 compared to a huge numbers of deals signed in 2021 to 2023.
Key LNG portfolio players are expected to be more selective this year, after signing 72 million tons per annum (mmtpa) in contracts in 2022 and 2023, the report said.
“However, some buyers might take a more opportunistic approach, with U.S. independent players leveraging on low Henry Hub prices to seek more exposure to global LNG prices by taking long-term LNG capacity positions, or more activity emerging in price sensitive Asian markets if contract prices fall further,” the report said.
The United States supplies buyers in both Europe and Asia, but is increasingly focused on Europe, especially with the loss of much of the continent’s supply of Russian pipeline gas following Moscow’s invasion of Ukraine two years ago.
There’s nowhere quite like Grantley Hall. Not in its native Yorkshire, not in the north of England, not anywhere in the whole of the UK for that matter.
This is an ongoing project of such lavishness that apparently house prices in the area have risen by 20 per cent.
And it’s all due to Valeria Sykes who, following her divorce from the billionaire and Brexit-backer Paul Sykes, has spent an unconfirmed £100 million on saving this 17th-century mansion and turning it into a glitzy and glamorous resort hotel a few miles from Ripon.
Arriving after dark is a thrill, the driveway lit up, with the River Skell flowing beside it.
Handsome young men in tweed waistcoats greet us outside the front door — one takes the luggage (and it’s important to turn up with lots of luggage here), while another parks our car.
Then it’s a seat in the drawing room and a glass of champagne during check-in before being escorted to one of only 47 rooms (with more than 400 staff).
There are five restaurants, including Shaun Rankin’s Michelin-star outlet; a nightclub; casino; the swankiest of gyms (44 running machines, including one that’s underwater); cryotherapy chamber, Formula 1 car simulator; lifestyle consultant; indoor/outdoor pool in the Three Graces spa; a ‘snow room’; gift shop; Japanese garden and so on.
At times, it feels like Dubai. At others, it’s Claridge’s or The Dorchester — with prices to match.
Footballers and their wives come here to splash the cash, but most of the guests we meet are, like Ms Sykes, Yorkshire born and bred — and proud to have such a statement hotel in the county.
We eat in the Pan-Asian restaurant, EightyEight, in the basement of a separate building where there’s also a wedding reception area. This seems to be the brash part of the resort. Service is slow but apologies come thick and fast.
Generally, there’s quality at every turn — which makes me wonder why on earth so many paintings are fake copies of Old Masters in tinny frames. And there’s piped music almost everywhere.
Even in low season, you won’t get a room for less than £500 a night but, frankly, anyone who quibbles at the cost probably shouldn’t be here in the first place.