Reserve Bank to loosen restrictions for home buyers
Finance Minister Grant Robertson is pleased that the Reserve Bank is easing restrictions on mortgage lending because it of its friendly relationship with the new Government.
Mr Robertson joins The AM Show to discuss his perspective on the lighter restrictions facing the housing market.
Starting next year, no more than 15 percent of mortgage lending can be to borrowers with less than 20 percent deposit - up from 10 percent.
Buyers with smaller deposits - typically younger first-time buyers - will be more likely to cut their teeth in the housing market.
“… [Reserve Bank Governor Grant Spencer] has got some confidence now the housing market heat's coming down,” says Mr Robertson. “And he's prepared to loosen these restrictions.”
The Finance Minister explains that Mr Spencer can now work on solving the housing crisis now that he has allies in the new Government.
"[Mr Spencer] had to have a Government that was working with him to solve the housing crisis - not deny that it existed, but have policies to change it," said Mr Robertson.
"We're also really pleased that he acknowledged one of the reasons he's got confidence is that we've got a plan to actually take the heat out of the housing market - build those KiwiBuild homes, crack down on the speculators."
Mr Robertson’s ideal solution wouldn’t be to lower the prices of existing homes. He would rather have prices to keep rising, but moderately so - not 10 or 15 percent, as they have been.
“People need to have value in their properties.” Mr Robertson says. “But it needs to be a market that’s affordable.”
Watch the full interview with Grant Robertson above.
The AM Show with Duncan Garner, Amanda Gillies and Mark Richardson, weekdays 6-9am on RadioLIVE and streaming live to the rova app on Android and iPhone.
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