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Prime Minister Jacinda Ardern says she wants to make sure early home buyers are able to enter the market after it was revealed this morning that house prices have risen nearly 20 percent.
See the prime minister speaking to the media here:
Home prices have risen 19.8 percent year-on-year with the median now at $ 725,000.
Ardern said this afternoon that the figures show an increase in first-time buyers in the market since 2017, but that investors in the market have remained the same.
“Obviously we want to make sure that our first home buyers can enter the market, that’s something we have in mind …”
“It just can’t keep increasing at the current rate,” he said of the price increase.
Meanwhile, ACT Party leader David Seymour took aim at Reserve Bank Governor Adrian Orr and said the country was monetizing its debt, avoiding tough decisions and instead giving itself artificially low interest rates.
Ardern says that with the mandate the Reserve Bank already has, they are using tools that are likely to have an impact on the housing market.
“Through the LVR regime, they have the ability to specifically target that end of the market. Considering that first time buyers will also benefit from the fact that we have historically low interest rates. But what it is doing as well. it is causing potential heat in the market for others looking to buy, which is why the Resource Bank is specifically looking at LVRs that are being used, which they are consulting on now, and which will potentially make a difference. “
She said having a kind of emphasis on LVRs with investors and people buying second properties was a Reserve Bank affair.
“A house is the most important asset that most families will have, and of course they want to make sure the asset maintains its value. But at the same time, they will have to make sure that people can access the housing market.” .
He said products like the Welcome Home program allowed people who paid rent equivalent to the service of a mortgage the ability to access the market.
“I want to go back to see if there are more things we can do to overcome that significant major hurdle from that first deposit.”
Ardern said the government had built more houses than any government since the 1970s, but the problem was that they were working from a low base.
“We are working very hard to overcome a crisis that has accumulated over several decades.”
Ardern said she didn’t want New Zealand home ownership to be determined by whether her parents, for example, can lend her a deposit or not. “That is not the New Zealand we believe in. That is why we are looking for progressive home ownership.”
She said that although interest rates have dropped significantly from the past, relative affordability was now a big issue.
She says the previous focus had been on building large homes on large lots of land and not on building affordable homes that first-time buyers need. The focus had now changed.
