New Zealand - The Good, The Bad and The Ugly.

[Hairy]

Yeah, I too wonder when one sees $100k+ cars cruising around Auckland like they're Mr Delivery.

 

There could be a few factors to this:

 

1. I think that Auckland is definitely a little more image focused than the rest of NZ. Much like Sydney is in Aus (some super flashy cars cruising around there). One tends to see just as many (if not more) new S and RS Audis than new base models.

 

2. As you mention, property ownership could have a big influence on this. Between us and our close group of friends (all young professional couples, between 30 and 35), all only have 1 car per household, and none of those cars were purchased for over $15k. We are all paying mortgages, however if we were 5-10yrs older and purchased said properties around 2012 or earlier, then the mortgages would be a fraction (or even paid off) and it would be a lot easier to redirect disposable income into a $100k+ car.

 

And that's just accounting for owners of single properties. Auckland would have a number of people with multiple investment properties, purchased a decade ago (or more) and have heaps of excess cash to buy luxury vehicles (and boats).

 

That said, compared to SA, even the flashy Jaffas are still unlikely t spend more than 10% of the value of their house on a car, whereas a showy Joburger wouldn't flinch at spending north of 25% on a luxury vehicle. (yes, I know one has to factor in that houses here considerably more expensive).

 

3. Spoilt kids. Auckland has no shortage of sub-30yr olds cruising around in super flashy cars (from AMG Mercs, to McLarens and Bentleys), purchased with mommy & daddy's money. Whilst it's not as extreme as portrayed by the Singapoean set movie, the term "Crazy Rich Asians" is definitely applicable in many of these cases.

 

All the above factors considered though, the income-to-car-value ratio in Auckland (of the purchaser, not the driver... damn trust fund kids), is still far below that of the middle-to-upper class in JHB.

I have seen a certain couple who's daughter used to go to school with my son (they lived/rented in our village) who were complaining that they would never be able to afford to buy as the deposits were way too much.

 

What they did not mention is that they both have brand new cars every 3 years max. and that these are very expensive cars, and they are always dressed in new brand clothing head to toe .... I also assume they are both spending a good bit of money at the hairdresser and beauty salons every month.

 

Our cars normally hang around for 10-12 years and would be considered basic.

 

People need to change their views on what is important for them in life and then accept this path. This lot chose to be flashy and then complain they do not have money to save for a house deposit ..... 

[Spurs]

While we're doing some comparisons between income and spending between SA and NZ, how would you guys see salaries compared like for like between the country's.

 

I saw above mention of R750k would roughly translate to R1.2M ($110k) in NZ.  Not sure if this was just used for the purposes of the example, but what are your guys thoughts on this?  I'm sure it would differ from industry to industry.

[MTBeer]

I have seen a certain couple who's daughter used to go to school with my son (they lived/rented in our village) who were complaining that they would never be able to afford to buy as the deposits were way too much.

 

What they did not mention is that they both have brand new cars every 3 years max. and that these are very expensive cars, and they are always dressed in new brand clothing head to toe .... I also assume they are both spending a good bit of money at the hairdresser and beauty salons every month.

 

Our cars normally hang around for 10-12 years and would be considered basic.

 

People need to change their views on what is important for them in life and then accept this path. This lot chose to be flashy and then complain they do not have money to save for a house deposit ..... 

dude you've just described half of Sunningdale / Parklands

[Hairy]

This was also an interesting series to follow RE container homes.

 

 

EDIT: This clip sounds like a complete sales pitch, but rather follow on to his page to follow the construction process.

 

 

Edited October 8, 2020 by Hairy

[Rocket-Boy]

This was also an interesting series to follow RE container homes.

 

 

EDIT: This clip sounds like a complete sales pitch, but rather follow on to his page to follow the construction process.

 

 

Yeah wow that clip sounds absolutely terrible!! I watched the whole series too and it was nothing like this clip.

Definitely a good series to watch for building tips.

[patches]

I have seen a certain couple who's daughter used to go to school with my son (they lived/rented in our village) who were complaining that they would never be able to afford to buy as the deposits were way too much.

 

What they did not mention is that they both have brand new cars every 3 years max. and that these are very expensive cars, and they are always dressed in new brand clothing head to toe .... I also assume they are both spending a good bit of money at the hairdresser and beauty salons every month.

 

Our cars normally hang around for 10-12 years and would be considered basic.

 

People need to change their views on what is important for them in life and then accept this path. This lot chose to be flashy and then complain they do not have money to save for a house deposit ..... 

 

Yeah, I remember when first moving to Christchurch, I was amazed at what a former colleague (and his partner) had achieved.

 

They were both 23, at the start of their professional careers. Both would have been earning about $60k annually.

 

Both drove old klunker cars (his was older than him, and not in a cool vintage way).

 

BUT, they bought a brand new, 3 bed, 2 bath, double garage freestanding house. It cost them about $450k ($150k land, 300k building costs).

 

He ate ham & cheese sandwiches nearly every day, just to keep within budget to pay the mortgage. But in the long run it was all worth it. he soon climbed up the ranks (as he is a hard worked and brilliant young engineer), and now they're pretty comfortable, 27, and firmly on the property ladder?

 

I understand that no grad couple in SA will be able to afford a R4.5m house, as equivalent salaries are lower and interest rates are higher. BUT banks in NZ also work off a 20% deposit as standard, anything less and they hike up the interest rates, or can simply say sorry, loan denied. So smart financial decisions are required, long before one applies for a loan.

 

Auckland however... it's stuffed! hahaha!

 

Viva la Christchurch!

[davetapson]

While we're doing some comparisons between income and spending between SA and NZ, how would you guys see salaries compared like for like between the country's.

 

I saw above mention of R750k would roughly translate to R1.2M ($110k) in NZ.  Not sure if this was just used for the purposes of the example, but what are your guys thoughts on this?  I'm sure it would differ from industry to industry.

It's hard (for me?) to compare.  Couple observations tho:

 

1. In SA you pay double for everything - you pay tax for school / police / hospitals etc and then pay again to send your kid to private school, pay for ADT/ Discovery etc - this chows up your post tax disposable income.

 

2. In NZ, you're not paying for the stuff the state should provide, so that remains disposable income.

 

3. Anything that requires labour is cheap in SA - restaurants, car washes etc.  In NZ that is expensive, as labour earn a living (sort of) wage. So you don't eat out as much.

 

4. Houses are eyewateringly eye watering expensive. However, once you own most of it, or all of it, you have huge capital - say R14M as opposed to the equivalent which would probably cost south of R2M in SA. Somebody sells their mansion in Ebotse for R5m - good luck with buying a pondok with that here.  And it should maintain value as the currency maintains value.  And nobody has their eye on taking it off you.

 

5.  We tend (when we behave) to have cash left at the end of the month, and save it.  The cash is worth way more than ZARS.  Never had cash spare in SA. Have savings here.

 

6. Cars are paid off as effectively bought for cash.

 

Absolute like for like: I earn probably 1.5x more here, but the comparison is largely meaningless.

 

NZ:ZAR rate is dropping - I put R4k in my mom's account every month - when we arrived it cost me NZD400+ - I think last month was about NZD367. 

 

Every month you stay in SA, you losing relative wealth - and it counts.  When we moved back to SA from UK in 2003 we brought our wealth (such as it was) back at 7:1 to the US$, took it out at the equivalent of 15:1 to the US$.  So that's effectively throwing away half your wealth 'for the lifestyle of living in SA'.

 

 

Edited October 9, 2020 by davetapson

[patches]

While we're doing some comparisons between income and spending between SA and NZ, how would you guys see salaries compared like for like between the country's.

 

I saw above mention of R750k would roughly translate to R1.2M ($110k) in NZ.  Not sure if this was just used for the purposes of the example, but what are your guys thoughts on this?  I'm sure it would differ from industry to industry.

 

Oh I just made those number up 

 

Just kidding! As you say, it is largely industry dependent, and my point of reference is consulting engineers. Some professions here (like construction trades) get paid a lot more (not only as an equivalent, but also proportionate to others).

 

I must also add that I am about 5yrs out-of-touch with SA salaries so did rely on an online source for that R750k.

 

So all that in mind, here are some indicators that may help.

 

 

As you can see in the above, the range is vast. From senior engineers being the closest (at about 1.6x) to minimum wage showing the biggest disparity (at over 13x).

 

Other factors should be taken into account, like the fact that the NZ effective tax scale is lower, expenses like insurances are a fraction of SA, and in the case of medical aid, it isn't even considered essential as the public health system is very capable. And schooling is basically  free.

 

But all that aside, I guess the general idea is that the higher up the SA payscale you are, the less drastic the the jump will be when moving to a similar role in NZ.

 

Teachers (and nurses) are a noteworthy one though. These are professionals with essential careers, who have 3yrs+ study under them, and their salaries can jump 3-4x in NZ. And believe it or not, they are considered underpaid here! So teacher's salaries in SA are outright criminal!

 

Once again, these are just estimates from searches and experience, and I am pretty out of touch with salaries and cost of living in SA, but the data above was as accurate as I could find.

 

I've often estimated that cost of living in NZ (with the exception of housing, especially Auckland) is about 1.5x that of SA. So again, those higher up the payscale will not notice a massive upgrade in disposable income and luxury lifestyle. Some even notice a slight downgrade (but there are other benefits that money cannot buy).

Edited October 8, 2020 by patches

[arabsandals]

While we're doing some comparisons between income and spending between SA and NZ, how would you guys see salaries compared like for like between the country's.

 

I saw above mention of R750k would roughly translate to R1.2M ($110k) in NZ.  Not sure if this was just used for the purposes of the example, but what are your guys thoughts on this?  I'm sure it would differ from industry to industry.

You can't translate salaries like that, it's meaningless because you're not factoring in cost of living which has a massive impact on salaries; you have to compare what it costs to live there against what you would expect to earn.Just use numbeo for cost of living comparison, then check some salary surveys covering your profession. 

[davetapson]

You can't translate salaries like that, it's meaningless because you're not factoring in cost of living which has a massive impact on salaries; you have to compare what it costs to live there against what you would expect to earn.Just use numbeo for cost of living comparison, then check some salary surveys covering your profession. 

Yeah, ZARs to whatever just doesn't work.  Life is just different.

 

There are things that you just can't put $ value to.

 

Security of economy, security of family, freedom to just walk around without fear of violence. 

 

Kids being expected to walk to school, not expected **not** to walk to school...

 

Wife sleeps at night when I'm not there, not the case in SA.

 

I used to tell my wife "You know what our friends overseas major concerns are at the moment?  What they're going to do on the weekend".  That's pretty much exactly how it is.  All that stress that hangs over you - just gone.

 

I voted today.  The choice was a couple of parties all slightly one side or the other of centre. Wouldn't be tragedy if any of them got in.  Not like the complete waste of time it is in SA.

[Wayne Potgieter]

Offer fell through. Was not happy with some of the dealings of the developer and have decided to withdraw our offer of the house in Wanaka. Will have to keep looking.

 

Any suggestions?

 

If you could live anywhere in NZ, where would you live and why?

 

• Must have access to a airport (a proper one)
• Must have good schools
• Must not look like ****.

 

 

[RossW]

 

Offer fell through. Was not happy with some of the dealings of the developer and have decided to withdraw our offer of the house in Wanaka. Will have to keep looking.

 

Any suggestions?

 

If you could live anywhere in NZ, where would you live and why?

 

• Must have access to a airport (a proper one)
• Must have good schools
• Must not look like ****.

 

Why not a different development/developer in Wanaka? Sounds like the town/area is the happy place for your family.

[patches]

 

Offer fell through. Was not happy with some of the dealings of the developer and have decided to withdraw our offer of the house in Wanaka. Will have to keep looking.

 

Any suggestions?

 

If you could live anywhere in NZ, where would you live and why?

 

• Must have access to a airport (a proper one)
• Must have good schools
• Must not look like ****.

 

 

Sorry to hear Wayne.

 

Last weekend I was down in Christchurch and Hanmer Springs and I had a very similar chat with my better half.

 

Our list was:

 

• South Island
• Outdoor lifestyle
• Within 1hr of an international airport (her parents are in Sydney)
• Decent healthcare (ideally an acute services hospital within 1hr)
• Good schools (for future rugrats)
• Decent university (not essential, but when future rugrats grow up, they have the option to stay at home and study if they want. Although Kiwis love to study "out-of-state).

Then my additions

• A Bunnings/Mitre10 (also not essential, but will make life a lot easier as I am always busy with something)
• Accessible dirt bike trails.
• within 1hr of a shuttle/lifted bike park.

Taking all that into account, there is only really 1 place which checks ALL the boxes... Christchurch (I may have skewed the criteria to favour Chch )

 

But

 

Forgo the uni then Queenstown (incl. Frankton and surrounds) and Wanaka are options

Forgo the hospital, uni, Bunnings, and settle for acceptable schools then Tarras, Cromwell & Alexandra are an option

Forgo the international airport then Nelson & Richmond are options.

 

Our wish lists are not too dissimilar. Christchurch may not be the most attractive or have that "sought after town" appeal, but it can check all the boxes. My area pics would be Huntsbury, Cashmere, Merrivale, Fendleton, or maybe even over the Port Hills and somewhere like Governor's Bay.

 

Although I know you looked at Christchurch and schools were the concern.

 

A 4ha+plot of land in Cromwell (or a house in Mt Pisa) would also be high up on my list.

Edited October 9, 2020 by patches

[davetapson]

I'm a bit ignorant of SI, but the one thing I have noticed is that everyone who has lived in CHC that I've spoken to says "blah blah blah but I loved living there..."

[davetapson]

Gah - we've just had notice that our rental house is for sale - tenancy is until Feb, but looking for a house in Feb is chronic. 

 

This we know because our previous house was sold out from under us in Feb.

Second time it's happened.

 

I suspect they are looking for the FOMO prices going around at the moment, and I also suspect it will be way out of our price range to buy.

[Wayne Potgieter]

Gah - we've just had notice that our rental house is for sale - tenancy is until Feb, but looking for a house in Feb is chronic. 

 

This we know because our previous house was sold out from under us in Feb.

 

Second time it's happened.

 

I suspect they are looking for the FOMO prices going around at the moment, and I also suspect it will be way out of our price range to buy.

This is one of the bigger downsides of renting, the place gets pulled out from under you.

 

Has happened to us to and it sucks.

 

Should we all start a weird gloriavale style community together? Only religion allowed is bikes.