The past three months have shown that the property prices have risen at the fastest rate since 2004. The new QV figures show that an average Auckland house value is now $975,087. Reserve Bank deputy governor Grant Spencer is giving a speech on the housing situation tomorrow and is expected to increase the loan-to-value ratios above the 30% limit for investors in Auckland. It is unlikely the Reserve Bank will introduce new lending restrictions that will affect first home buyers as the government is focused on making it easier for first home buyers. One way in which they have made it easier is by relaxing the rules on the KiwiSaver First Home Deposit Withdrawal criteria for previous home owners as of 1st July – income caps no longer apply.
Any new lending restrictions will be focused on investors. We are already seeing an impact on Auckland investors with the introduction of the 30% deposit requirement. Increasing the deposit requirement for Auckland investors to 40% will most likely have less of an impact than placing investment lending restrictions on other high growth areas such as Hamilton, Tauranga, Christchurch, and Queenstown which haven’t seen any major restrictions as yet.
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