Big change com­ing in real es­tate

Coastal News - - Front Page - By LES­LEY STANILAND news@coastal­

Many changes are ahead for Aus­tralian and New Zealand real es­tate, with a ‘scary’ sce­nario laid out for their fu­ture, says First Na­tional Aus­tralia chief ex­ec­u­tive Ray El­lis.

Mr El­lis vis­ited the Whanga­mata First Na­tional of­fice af­ter at­tend­ing the First Na­tional NZ An­nual Strat­egy Plan­ning meet­ing at Puka Park, Pauanui.

He was ac­com­pa­nied by New Zealand CEO Bob Br­ere­ton and Christchurch owner Joe Mullins.

The Whanga­mata com­pany’s prin­ci­pal Gordon Turner is a First Na­tional NZ board Mem­ber .

Mr El­lis said the boom and bust phe­nom­ena oc­curs slowly in Aus­tralia but in New Zealand, what­ever hap­pens in Auck­land quickly spread to other ar­eas.

Both coun­tries were sim­i­lar when it came to peo­ple want­ing their own piece of dirt, whether it be an old bach or a $20m home in Auck­land.

“In­ter­est rates are so low here but the cur­rent gen­er­a­tion aren’t us­ing that to fund debt nor in­crease in­vest­ment be­cause they want life­style first,” Mr El­lis said.

Peo­ple un­der 35 years want life­style, and over­seas trips up to four times a year and en­joy be­ing part of the cafe´ set.

“This makes it a chal­leng­ing trend for real es­tate mar­kets,” he said.

He said fu­ture govern­ment pol­icy must be well thought out and care­ful of us­ing as­sets from baby boomers be­cause the av­er­age New Zealan­der makes their wealth through prop­erty be­cause they can ‘touch and see it’.

He said he felt large cor­po­rates would not be get­ting into mass in­vest­ing in hous­ing to meet hous­ing short­ages purely be­cause main­te­nance costs were too high.

Mr El­lis pre­dicted a change would come, as in the US, where peo­ple would en­ter in long-term leas­ing of homes.

“You can live at the ad­dress in 5th Ave New York near fam­ily, re­gard­less of cost.

“They feel they own the home they are rent­ing rather than ac­tu­ally pay­ing for it,” Mr El­lis said.

He also pre­dicted that, be­cause of rapid de­vel­op­ments in tech­nol­ogy, 60 per cent of peo­ple in jobs right now will be out of work in 10 years.

For ex­am­ple, four floors of ANZ in Auck­land would be much re­duced due purely to the rapid ad­vance­ment of tech­nol­ogy.

“On the other hand, I pre­dict ser­vice in­dus­tries will grow, such as laun­dries, house clean­ing, mow­ing and the like be­cause the new gen­er­a­tion won’t want to do these things.

“And I see the fu­ture at su­per­mar­kets where you will have your cell phone in your cart and it will tally up and pay for your shop­ping dig­i­tally, mean­ing a lesser need for staff. So the big ques­tion is who will pay to keep the un­em­ployed alive?”

He also pre­dicted that with driver­less cars be­ing the way of the fu­ture, there would be no crashes, there­fore no need for ve­hi­cle in­sur­ances, panel and paint com­pa­nies and all re­lated in­dus­tries.

“And, when we fi­nally be­come a cash­less so­ci­ety, that’s when I’ll head for the hills,” Mr El­lis said.

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