Amber
Haddock “Capital not supplying enough houses-report”.
Blog 12
James Weirs article published by the
dominion post forecasts how Wellington the capital city is not supplying enough
new houses with over 1200 houses in shortage. Auckland shows that it is the
highest city in New Zealand with the shortage in new houses reaching over
13,000 for the current demand. 1370 new houses were built in Wellington that
did not meet the demand of housing needing to be an extra 27% however Auckland
needed to increase property build by 53% to meet the increases in housing
demands to date. Whilst evidence of Wellington demanding new houses there is no
urgency among buyers that is extremely evident, an apartment developer
described the demand as “solid demand”. In the past decade in Wellingtons CBD
has increased from about 6700 to 13,000 living in town. With the housing demand
being in the cities CBD this means apartments and office buildings revamped
have been the major contributing factor in houses built over the past 10 years.
The further development of apartments and office building revamps has said to
be a positive trend in the property market as is taking pressure off transport,
resources and car parking.
A local economist stated that the
opinion on house shortages may not be exact, as the age of people living in
apartments and in town is younger/ middle aged people who tend to have more
people in a house rather than older people who tend to have fewer people in
there houses (Foster). Foster does agree there is a shortage of housing to an
extent as opposed to the growing population. Harcourt’s managing director Matty
Scott said that there is no land available for houses in the demanded locations
such as Wellingtons CBD apart from high rises and apartment buildings. The
Reserve Bank of New Zealand have introduced speed limits on low deposit loans
which in turn had reduced buyer interest. Scotty states that if there were to
be a 1200 housing shortages in Wellington this was not evident in buyers as
supply and demand seemed to be fairly balanced.
Main focus point featured in the
article: Wellington and Auckland are in shortage of housing supply.
This article relates to Welly Real
estate due to the fact housing shortage means less sales in the market (supply
not meeting demand) and could decrease business for Welly Real estate.
Advise to Welly Real-Estate could be to
focus the business on property management as the market at present suggests tha
choosing to rent over homeownership is easier and this could be
a niche in the market that Welly Real-estate could direct there business
and further generate income. Welly real estate could be in charge of taking on properties from
landlords and managing them whilst receiving a commission. Due to decreasing
number of house sales this could be quite beneficial to Welly Real-estate as
they market for this is increasing and they have the chance to expand the
business in this way.
Works Cited
Fairtax, NZ. “Capital not supplying enough
houses-report”. Dominion Post. 20 April. 2014.
A3. Print
Rush, A. "Property Values up 8.8pc".
Web. April 4.2014. http://www.nzherald.co.nz/property/news/article.cfm?c_id=8&objectid=11233729
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