Further Reserve Bank intervention predicted
We may not have seen the last of Reserve Bank intervention in the housing market.
Loan-to-value restrictions limiting lending to investors with deposits of less than 40 per cent officially kicked in this week. Banks had been required to act in the spirit of the rules since July.
Corelogic analyst Nick Goodall said they seemed to be having an effect on the market.
But the factors driving house price increases had not disappeared.
‘‘While demand has been hit by the latest round of loan-to-value limits, the low interest rate environment still makes borrowing attractive for those able to get the required deposit.
‘‘Then on the supply side, specifically in Auckland, the Unitary Plan should start to have an impact but as with any development/regulatory changes it’s going to take a while for processes to catch up so options for buyers will remain constrained for the time being.
‘‘All of this means it’s unlikely that values will be heading south any time soon, which will no doubt continue to draw the attention of both the Government and RBNZ. My pick? More intervention to come.’’
More rules may be coming to curb the property market.