Auckland mortgagee sales ugly, up 19% this week
http://www.interest.co.nz
Intro
Today, we’ll look at fresh signs of stress in the housing market, where mortgagee sales listings have doubled since early February,
And we’ll look at the increase in the staggering amount of bank lending in the last 5 years. Banks are now heavily dependent on the housing market. More on that in a minute
Mortgagee Sales
But firstly, we look at the latest results from the interest.co.nz mortgagee listings index.
We are tracking the number of listings for mortgagee sales on trademe.co.nz and realestate.co.nz.
The overall number is up 7% this week alone and has more than doubled since we started tracking these figures in February.
It’s a very interesting exercise. Just go to these websites and search for mortgagee to see what type of house is up for sale. There’s a lot of investment properties, particularly anything that looks a little leaky.
And there’s quite a few sections as well as developers struggle to get funding to build houses or apartments on that land.
The story in Auckland is uglier, where the number of mortgagee sales listings have risen 19% in the last week alone and is also more than doubled in the last 6 weeks.
Elsewhere the number of bankruptcies and “no asset procedures”, which is a sort of bankruptcy lite, has risen sharply in the last four weeks.
Times are tough and getting tougher.
Deposit Insurance
Now for a closer look at how exposed the banks are to the housing market.
Our analysis of the bank’s disclosure statements for the last 5 years show they are much more exposed than they used to be.
Now almost half of all bank assets are mortgages on land and houses. That’s up from just over 40% five years ago. That’s because of the huge boom in house prices and the bank lending that went with it.
Banks now have NZ$148.3 billion of mortgages. That’s double what it was 5 years ago.
It means that a crash in the housing market and a big increase in defaults and people not paying their mortgages on time will affect the banks here. The exposure to the housing sector here is even greater than it is in Australia.
ASB is the most exposed of the big banks with just over 63% of its assets in mortgages. At the lower end of the scale is BNZ with 42%.
It just reinforces our call last week for a debate on a bank deposit insurance scheme.
Along with Australia, New Zealand is one of the few countries that does not have a deposit insurance scheme just in case a bank fails.
As we saw over the weekend with the near failure of Bear Stearns, these things can and do happen, even for the big names.
We believe New Zealand should set up a government run deposit insurer that charges the banks and therefore their customers a small fee to insure the first 100 thousand dollars of deposits for each depositor.
That will help reduce the risk of a run on a bank and will ensure at least some protection in the event of a disaster. It will also prevent the government from having to bailout or nationalize a failing bank.
Duration : 0:3:34
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How is your town doing? Is there tons of empty commercial real estate? Is this the end of the urban sprawl? Many are losing millions from lost rentals. If the large corporations are having a hard time staying in business how is the little guy going to make it? If debt is money and there is no credit, there is no money! Please add a video of your town of commercial or residential. You pray & the churches prey! March 13, 2009
Orange County Real Estate Home in Santa Ana CA 92704. Incredible 5 bedroom 4.5 bath 3 story home! Amazing backyard with plenty of room for parties and friends. Elegant, classy, rare. 
This Video was origionaly featured on The Bob Chapman Channel, Jan 4, 2010. The Deceipt continues as Commercial RealEstate begins it’s collapse. The United States of America is Bankrupt. Soon we are going to be plundged into the Greatest Depression ever know to mankind, our corrupt Government can only try to forstall the inevitable, to be forewarned is to be prepared.
Need to lease any office space? There is more and more available in Florida and other places around the country. If this continues many more companies will be out of business and bankrupt. I’ve heard over 150K businesses went bust last year.
This should be the LAST video on the subject for a while. Well I recieved a call from the Mayor directly a couple of days ago – and he seems like a stand-up guy. He can’t overturn the Westland Housing Commission no matter how far from their own guidelines they stray. It sounds like HUD is the only way to go.
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