Reserve Bank leaves Official Cash Rate unchanged at 1.75%; seems more confident housing market will not take off again, sees lower dollar and predicts a slightly earlier start in 2019 to interest rate rises

By David Hargreaves

The Reserve Bank is now more confident that the housing market will not take off again.

In recent releases the bank has expressed satisfaction that the housing market has gone quieter - after introduction last year of 40% deposit rules by the RBNZ for housing investors. But, the central bank has kept cautiously warning that the market may rebound.

However, in the latest Monetary Policy Statement, RBNZ Acting Governor Grant Spencer has changed tune somewhat.

He notes again that house price inflation has moderated due to loan-to-value ratio restrictions, affordability constraints, reduced foreign demand, and a tightening in credit conditions.

This time around, however, he says: "Low house price inflation is expected to continue, reinforced by new government policies on housing."

The previous warning contained in past releases that "there remains a risk of resurgence in prices" has gone.

In the MPS document itself, the RBNZ says that residential investment has been supported over recent years by low interest rates, strong population growth, a shortage of housing, and high house prices.

Weaker residential investment growth

"However, growth in residential investment has weakened in each of the past four quarters.

"Residential construction in Canterbury has fallen from a high level, and elsewhere the sector appears to be approaching capacity limits," the RBNZ says.

"Businesses are reporting greater difficulty accessing land, labour, and materials.

"Also, partly reflecting growing risks in the construction sector, banks have tightened lending standards for residential property development.

"We expect residential investment to provide less impetus to aggregate growth and capacity pressure over the next year than previously assumed," the RBNZ says.

It goes on to say that changes to loan-to-value ratio (LVR) restrictions, a tightening in lending standards, and a lift in mortgage rates through the end of 2016 have moderated the demand for housing and slowed house price inflation over the past year.

"Pressure on affordability, reduced demand from foreign buyers, uncertainty around tax policy, and revised expectations of future capital gains may be further tempering demand at present."

The RBNZ does say that It remains uncertain how persistent the slowing in the housing market will be.

"Household consumption has strengthened since mid-2016 and has been stronger than expected based on its historical correlation with house price inflation.

"Aggregate consumption growth is being supported by low interest rates, high terms of trade, and strong population growth. It appears household spending may be less responsive to changes in housing wealth compared to previous cycles."

OCR left unchanged

The RBNZ has as expected left interest rates, via the Official Cash Rate, unchanged at 1.75%.

But of bigger interest is the outlook seen for the bank - and here there have been some tweaks.

The RBNZ has tried to incorporate some preliminary estimates of the impact of the new Government's policies in its latest set of forecasts - though it says there is a great deal of uncertainty around this.

One of the more significant changes in tone in the Acting Governor's latest statement, when compared with the previous one in September, is that the references to a lower dollar being desirable have been removed.

The Kiwi dollar has fallen substantially in recent times.

In the latest statement Spencer notes the recent decline in value of the dollar and says that if sustained, this "will increase tradables inflation and promote more balanced growth".

Following the release of the latest RBNZ statement the Kiwi dollar was at about US69.5c, up from just under US69.3c before the statement.

Looking forward

In summary, the RBNZ now sees a very slightly earlier start (June 2019 versus September 2019 previously) rise in official interest rates. It's seeing slightly higher inflation in the short term and a weaker dollar - though the latter reflects recent weakness in the currency since the new Government was settled.

ASB chief economist Nick Tuffley said a key development with the RBNZ's latest statement was the inclusion of initial impacts of the new Government’s fiscal spending, Kiwibuild, migration changes, and minimum wage increase.   

"On balance these changes are likely to be more inflationary than the previous assumptions the RBNZ used," Tuffley said.

He noted, however, that despite including those changes, the RBNZ’s OCR forecasts started edging up only a quarter earlier. 

"Moreover, the forecasts still have the OCR averaging 2% over the March 2020 quarter. 

"By implication, the RBNZ’s forecast see – at the margin – a touch more risk of an earlier start to OCR increases, but fundamentally still a core view that the OCR is likely to remain on hold until around late 2019."

This is the statement from RBNZ Acting Governor Grant Spencer:

The Reserve Bank today left the Official Cash Rate (OCR) unchanged at 1.75 percent.

Global economic growth continues to improve, although inflation and wage outcomes remain subdued. Commodity prices are relatively stable. Bond yields and credit spreads remain low and equity prices are near record levels. Monetary policy remains easy in the advanced economies but is gradually becoming less stimulatory.

The exchange rate has eased since the August Statement and, if sustained, will increase tradables inflation and promote more balanced growth.

GDP in the June quarter grew broadly in line with expectations, following relative weakness in the previous two quarters. Employment growth has been strong and GDP growth is projected to strengthen, with a weaker outlook for housing and construction offset by accommodative monetary policy, the continued high terms of trade, and increased fiscal stimulus.

The Bank has incorporated preliminary estimates of the impact of new government policies in four areas: new government spending; the KiwiBuild programme; tighter visa requirements; and increases in the minimum wage. The impact of these policies remains very uncertain.

House price inflation has moderated due to loan-to-value ratio restrictions, affordability constraints, reduced foreign demand, and a tightening in credit conditions. Low house price inflation is expected to continue, reinforced by new government policies on housing.

Annual CPI inflation was 1.9 percent in September although underlying inflation remains subdued. Non-tradables inflation is moderate but expected to increase gradually as capacity pressures increase. Tradables inflation has increased due to the lower New Zealand dollar and higher oil prices, but is expected to soften in line with projected low global inflation. Overall, CPI inflation is projected to remain near the midpoint of the target range and longer-term inflation expectations are well anchored at 2 percent.

Monetary policy will remain accommodative for a considerable period. Numerous uncertainties remain and policy may need to adjust accordingly.

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

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67 Comments

Tweaking? It's going on...everywhere!

If the unemployment rate is wrong, then: wages aren’t going to accelerate; inflation is in no danger of picking up because significant labor slack remains; meaning that the 15 or 16 (or more) million Americans left out of the official ratio do matter....Unless all of this changes real soon (a likelihood that decreases every additional month further from when it should have back in 2015), those 15 or 16million missing have to be accepted as part of the ongoing problem. And in incorporating them (correctly) that means everything in the policy response going back to 2007 has to be thrown out and rethought. It would indicate Bernanke wasn’t courageous at all, instead thoroughly incompetent.
An influx of new FOMC members might reach similar conclusions, or at least for the first time be open to considering them, though not just about Bernanke and/or Yellen’s tenures but also those of any remaining members who failed to register anything but the official stance/view. At FOUR POINT ONE, how much margin for error is left before some very uncomfortable questions lead toward blame?(Jeffrey Snider)

I was reading the other day that most of the increase in jobs in the USA in the last eight years were freelance, part-time jobs. E.g. driving for Uber for a few hours, doing some low paid work on Freelancer.com. People just trying to do a bit more to get by, and it's counted as successful jobs growth.

Rick exactly right
In the US if you work a 1 hour job a week that’s counted in the statistics as a full time job
Most people can only pay the bills by either multiple part time jobs or borrowing Usually both so a vicious cycle of increasing debt and overwork
That’s the American dream these days and the parasites that lend pay day loans out at abominable interest rates.
Meanwhile Trump will axe death duties and save his family 600Million to 1Billion in death duty taxes alone
All the loopholes for businesses are being retained yet individuals exemptions will be axed
Initially there will be a small tax break for individuals but this will be eliminated in the years ahead to actually be paying even more tax than today
The place is a mess & that’s just the mass murders

Huge growth in part time jobs, because if you employ somebody for more than X hours per week you have to pay obamacare and other benefits. So employers employ them for X-1 hours max. Part of the ridiculousness that is the USA tax/social security system.

For most people, measures of the economic environment are consumed subjectively. Pretty much ammunition for puppets like the Hosk (whose understanding is likely to be superficial at best).

The only real way to understand unemployment us as a construction of components. Furthermore, you need the ability to qualitatively assess the data, not just to look at a numeric outcome. Data is still collected in an old fashioned manner using random sampling. There has to be a better way and I would think that using an organic panel with digital data collection should be explored.

They refer to house price inflation. I thought that is not a factor in the CPI and associated OCR decisions, other than perhaps indirectly?
Conversely, my understanding is that rental inflation 'is' a relevant factor, and evidence shows that has risen significantly this year.
Is someone able to enlighten me?

True, (existing) house price inflation isn't factored into the CPI.
It is does however have a strong impact on consumption decisions. Thus, flattening house price inflation leads to lower demand for consumption.

True, (existing) house price inflation isn't factored into the CPI.

Yes it is.....indirectly and after it is watered down. But I know what you're saying.

Have just read the Reserve Bank's News Release for 9 November.

With regard to housing, it states:

"Low house price inflation is expected to continue, reinforced by new government policies on housing."

There's no mention of house prices falling - just slowly inflating.

A surprise to some, perhaps??

TTP

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Probably more like an attempt not to spook the horses. Prices are going to fall, it's just no one wants to be the one to say it publicly.

And you reckon the RBNZ, and other Central Banks have it 'all' under control? If they do/did, then why did 1987 hit? or 2000? or 2008? None of those was supposed to happen in a sophisticated, modern financial World that they understood. Like as not at some stage we'll see they have missed the Bigger Picture again. The only real question is - when?

TTP, the RBNZ is talking about the national housing market average. On average, the housing market is slowly inflating. In Auckland, the housing market has been deflating. Their expectations and my expectations match, that of a mildly inflating housing market nationally. I also expect the local trends to continue, where many regional areas will continue their growth, balanced by continued housing price deflation in Auckland.

Do not conflate the national housing price average with Auckland housing pricing.

Hi Yankiwi,

Is so, then despite Auckland being by far the largest house market in NZ, any fall in Auckland prices won't be sufficient to deflate house prices nationally.

TTP

TTP, any fall in Auckland prices won't be sufficient to deflate house prices nationally. Based on your words alone FHB should wait - well said! TTP, house prices are NOT a one way bet and are entering a long term period of underperformance. Consider longer term implications of unwinding of QE and the picture looks pretty negative on house prices. FHB - there is no hurry, save, you won't regret it.

Hi Retired-Poppy,

Don't agee with you.

If house prices outside Auckland continue to inflate and Auckland prices don't fall by too much (if at all) FHB's and others might best buy now.

If I was a FHB I wouldn't hesitate to buy, if the "right" house came on the market, whether it was in Auckland or elsewhere. I might well be better off financially, over time, than paying rent - plus the security/certainty that comes with owning the roof over one's head.

In any case, good rental accommodation is desperately short in the two largest centres - Wellington and Auckland - with rents continuing to rise rapidly. Concerning Auckland, projected population growth of around 50,000 people per annum for the next 30 years means there'll be sustained upward pressure on rents.

TTP

Except that Auckland is clearly the leader for house prices and the other regions tend to follow with a lag of several years depending on distance from Auckland. Auckland explodes around 2011, Hamilton and Tauranga follow in 2013 then Napier/Gisborne from 2015.

The falls come in the same way. Auckland falls first, then Hamilton/Tauranga next and the smaller rural centres last.

You can see this clearly happening the data. Auckland is already falling, slowly at first but gathering pace. Hamilton and Tauranga will probably start falling next year and those smaller regions might be 2019 or 2020 depending on how much Auckland falls.

House sales tend to lead prices and you can see those falling dramatically in Auckland already (and slowing in the other regions)

Trying to claim prices are rising nationally shows we are fine is either a total misunderstanding or misrepresentation of the data.

Retired-Poppy, I can't remember which commentator it was on this website, but somewhere within the comments, someone gave advise on how to time the bottom of the housing market near as dammit. You can't time the very bottom obviously, but you stand a better chance of timing the moment it starts to tick up again, and this, he advised, was the best time to buy.

The worst case scenario, with this is that you might end up paying a small amount more than someone who bought at the very bottom of the market, but seeing as house price growth after hitting bottom is usually quite slow, we're never going to be talking huge amount of money you pay above the very bottom.

So personally, that's what we'll be doing. Watching and waiting. And I can't see much risk to doing that. Our plan is to buy, once certain measures have indicated that the market is picking back up again, over say 3 months (beware the dead cat bounce or outlying measure) of sustained growth in price, reduction in inventory, time to sell etc

And in the meantime, just saving, saving, saving because a big deposit will help mitigate banks reluctance to lend during a credit crunch.

I'd love to hear how this strategy is less sensible that just ploughing in and buying now because of FOMO (as some here keep suggesting)? Sure, whether I buy now or in 2 years...ultimately.... in 10 or 20 years we know that the house value will be much more. *BUT* the mortgage in 10 years has the potential to be a lot less by then, or the interest paid on that loan significantly less, (if we wait and let the market potentially go down)! Definitely worth the risk of waiting from my perspective!!!

gingerninja, I suggest that the best time to buy is when it looks like it could not possibly get any worse! If I were FHB, I would wait for the unprecedented fallout in equal measure to the unprecedented lending folly we have all witnessed. NZ is overbanked. I'm referring to customers being offered cash deposits, televisions and holidays. Those days are behind us. Despite what banks say, I believe a lot of this lending would not stand the light of day in a falling market.

Hahaha. Yeah that would probably work too, but there are times when you think it could not possibly get worse, and it does.

I bought my first house at 19 in that type of market, it was a new build, they gave me free carpets and a 5% deposit!!!! It was so easy, and I was so young, that I really didn't know how good I had it!

We're saving too, though a 1-3 year wait will cost a bit in rent.

Is your money sitting in one bank? NZ or AU owned? I'm wondering whether we need to diversify our savings into more than 1 bank. Losing all your savings during a credit crunch would be a nightmare. I don't have a portfolio of any kind other than savings which feels risky...or maybe just paranoid.

Advice appreciated ;)

Diversifying across a few banks will cost you nothing and help you sleep at night. Apart from a little more admin work, what's not to like? Whether it will actually help in the event of something going bump in the night, I have no idea, but it will help your state of mind.

rocklobster x2, spreading amongst several banks is best. If in a credit crunch just one major bank falls victim, is closed on a Friday then reopened on a Monday under OBR, you might be subject to a small loss. Much worse for those with all eggs deposited one basket case or even worse if you're a shareholder. TTP, would have FHB risk committing financial suicide by buying in a toppy market. I cannot see how this provides security of home ownership. A bank can decide to call in loans through reasons of negative equity. My understanding is that even if you're paying on time and up to date, the bank can call in your loan. Banks will do everything to hide bad lending when their security tanks in value.

Or as a recent FHB here, have $10k credit card that’s untouched and I put all my spare “savings” money on the mortgage. If a rainy day comes I have the CC and sure that’ll incur interest after 6 months but I’ll save more in mortagged interest long term I hope. Banks can’t touch your savings if you don’t have any.

"We're saving too, though a 1-3 year wait will cost a bit in rent." True but having a larger down payment and probably a much cheaper house you will save on future interest payments which will probably be very long term.

rocklobster, if you put your money in a major bank you don't have to worry. Some here don't seem to know what's happened over the last 10 years. If a bank was to fail (you're more likely to die in a car accident) the government will bail the bank out (they even bailed out Canterbury Finance which was not a major bank). Don't worry too much, you'll be fine and don't listen to all the renters on this site who always find a reason not to buy. Take the plunge, buy a house when you can afford it or you will still be waiting for the right time to buy when you're 90.
Take advice from people who have what you want.
Listen to someone who has been happily married for 25 years if you want relationship advice
Listen to a coach who has played your sport if you wanna improve at that sport
Listen to people who own a/several houses if your aim is to buy one.
Do NOT listen to people who don't have what you're trying to get no matter what the topic, they drag you down

Rocklobster,

My hubs and I run a UK company, and are paid on pounds, so we keep most of our cash in UK investments, spread out, where there are deposit guarantee schemes. We bring over chunks of cash to live on whenever the exchange rate improves for us. But yes, all our money is diversified.
Paying rent is a cost obviously, but when you work out the cost of mortgage interest, rates and maintenance, I found the cost of renting was more than worth the opportunity cost of waiting to buy. Especially as we are really getting to know our neighbourhood, the good streets, where gets battered worst by the wind (we're in Wellington ;-) ) but without the commitment of ownership. I've already seen the market turning local to us, it's become much more of a buyers market but there is a huge chasm between what buyers are willing to pay and what sellers expect. So there is a stand off going on.

Renting has many advantages. Don't you get rent from a property in the UK too or is that all absorbed by mortgage payments?

Zachary, yup, the UK house offsets the cost of the NZ rental somewhat.

We were originally going to sell our UK place but then Brexit happened and the pound went down the toilet. And of course at the time the NZ housing market was booming. So we just decided to rent out our UK house and get to know Welly as tenants. My hubs is an Aucklander, so neither of us knew Wellington anyway. We have found renting in NZ much more pleasant than in the UK. I know that landlords get a bad rap in both the UK and NZ, but our personal experience has been that NZ landlords are much nicer! MUCH.

We endeavour to be as diligent landlords as we can for our UK tenants too, but we're not keen on housing as an investment and are definitely reluctant landlords. We prefer other investments classes, they are a lot less work but the UK housing market is looking pretty shady at the moment and our tenants are desperate to rent for longer (they run the house as a B&B very successfully) so we really don't know what to do with the house in the UK anymore! It would probably be more sensible to hold on to it, but tax in both countries is a also a stress. And there is CGT in the UK for us too, which increases the longer we hold the property, even though it was our family home.

Thank you all for taking the time to share your advice.

Yankiwi x2 - the trend of Aucklanders cashing in and heading to the regions will continue subject to there still being viable equity to cash in and ability to sell. I would suggest this trend has only limited life to it. Eventually the tail will follow the dragon's head - down.

Agreed.

I know of one such Aucklander who is heading for the sprawling metropolis of Palmerston North......

Palmerston North: the land of opportunity - and cheap houses!

TTP

TTP, what's your take on the RBNZ "Also, partly reflecting growing risks in the construction sector, banks have tightened lending standards for RESIDENTIAL property development? So many livelihoods depend in one way or another on a thriving residential construction sector. Banks are clearly nervous about future house prices - nationwide. The oil behind this fantasy "houses are a one way bet" mentality is slowly draining away.

As someone who works in and around urban development - yes, less designs are moving forward to resource consent, let alone getting built.
The peak has definitely come off architecture, planning and engineering work, although it is still ok.
On the one hand this fall away will support prices (less supply). On the other hand, it will take further heat out of demand as design professionals, property people agents etc make less money

I very much agree with your comment Retired-Poppy. These predictions have a limited period of applicability. At some point, the national average will start trending down, with Auckland leading the way down. the fun aspect is when the national average trend direction changes. It is rather clear that the Auckland trend direction is consistently downwards despite some spruikers declamations (where is Eco Bird anyhow with the oft claimed declaration that August was the low point for Auckland? How is that claim working out?).

If we follow prices every 5 min and try to prove a point, then we could all be proven wrong in the following 5 min .... nothing has changed other than the rhetoric, crystal ball fortune telling, and the wishful thinking - I still believe that July/August was the bottom in Auckland and we need to be patient to see where the trend will takes us in the following quarter i.e december numbers which will be a indication of the trend....

meanwhile , it might feel good to talk about house prices going down in Auckland ( but the question is , which houses and what are they really worth??) ... Anyone who actually keeps a finger on the pulse and is in the market to seriously buy a house would know that trying to buy a quality property ( modern or renovated, and in good shape) would struggle to find them at below last year's prices, even below March peak price - No one wants to buy a property in need of any sort of improvement or renovation ( even a simple TLC) !! that is a turn off for most buyers today ( no matter what the price was) ... getting involved with tradies or the ACC is a nightmare most can do without, and no one knows how long is the piece of the renovation string!.
Again, rubbish is being sold at rubbish prices - in fact , if they ever find a buyer !! some practical examples exist in West and South Auckland .... so if people want to measure average prices or trends on rubbish houses that are being sold dirt cheap ...then feel free to feel good ! ... but the reality is that most houses on The Shore, central and east auckland and all quality residential pockets in the super city are still holding their prices and appreciating as building costs move higher and new developments slowing down.

Eco Bird you are sounding ever more desperate.

Ecobird, i'm the opposite, I don't want someone else's renovation. I look at the renovated houses and find it a turn off, because I would relish the opportunity to do it myself and to my own style.

My last renovation, I did use Electricians and plumbers, but most of the rest I did myself and was very happy to, because I have been very unhappy with the standard of many tradies.

Desperate for what exactly ..??, .... I am a long term property investor who will hold my properties for life and pass them on to my kids after I'm gone - I am not a trader to flip over houses like some like to do whenever they feel the shivers down their spine when reading a piece here or there ... !! ... and deal with properties like commodities or shares !!
I follow the market to buy a bargain - not to sell !! ....And wouldn't care less if prices dropped 20% tomorrow .... I guess this is something that most here struggle to comprehend as they keep counting cents and paper loss or gain !! ...

Eco Bird. Your constant spruiking belies such claims.

yeah, maybe you might like to widen your horizon a bit one day and keep an open mind !! :) ... different views and experiences could be useful to the wise !!

.

Hi Eco Bird,

Appreciate that you're well meaning with your advice.

Regarding types like Didge, however, one can't teach old dogs new tricks.

TTP

Eco Bird is just telling it like it is. You really don't need to worry about Auckland Didge, go feed the chickens or something.

Like it is? Hahahahahahah.

The fall away in Aus prices will also whack Auckland a bit

Yankiwi, Auckland may not deflate significantly but if it did it might be uneven. Certain areas could even continue to inflate moderately. Also the likely scenario is some deflation followed by some moderate inflation depending on location.
It is also an odd situation to have the regions inflating with Auckland deflating. Not a scenario I could see being a long term thing.

Agreed ZS, it is an odd situation and is unlikely to be a long term trend. As to the amount of deflation for Auckland in the future, this appears to be a contentious topic. Yes, location can and does have an effect. I've seen this effect go in both directions, where the very desirable location premium takes a rather large hit when the sentiment gets sufficiently bad (think a decade ago in the US), where the most affordable homes in average locations had a smaller percentage price decline than the most desirable locations (which had both the highest price increase as well as highest price decrease). Past performance doesn't guarantee the future, etc. YMMV

I will note that the opposite trend for Auckland vs region prices occurred for far longer than many expected in the past decade, where the regions stayed flat or even declined while Aucklands prices were increasing in multi-digit percentages for quite a few years. Occams razor (and the thought of parity) suggest that we may see a rather protracted unwinding of Auckland prices as compared to region prices.

My Ol' Dad's Rule:
"When the property market is going up, buy the most expensive place/area you can! When it's going down, sell everything!"

The old buy high, sell low approach? Wait...

Hi Zachary,

You make some worthy points.

Interestingly, in its press release today, the Reserve Bank doesn't single out Auckland for any special mention re its housing market. RBNZ alludes to neither a resurgence nor a downward correction in Auckland house prices.

While I'm sure that Auckland is still on the RBNZ's radar, any concern with house prices there may well be diminishing.

TTP

Interestingly, in its press release today, the Reserve Bank doesn't single out Auckland for any special mention re its housing market. RB hasn't alluded to either a resurgence or downward correction in Auckland house prices.

It's not interesting at all. Central banks are not in the business of predicting booms and busts. That is why they cannot effectively prevent the negative consequences.

Furthermore, even if the central banks did have a crystal ball, they definitely wouldn't share the insights with the sheeple. The fact that you find this "interesting" shows that the RBNZ is doing its job of not causing any alarm. It's up to the Hosk and co to convince you of our "success."

Hi J.C.

Worthy comment.

But while RBNZ may not come out and predict/publicise booms and busts as such, it does forecast key economic variables and formulates/implements monetary policy accordingly.

Concerning your comments on your friend The Hosk, perhaps he might be appointed to the RBNZ Board - where he might wield even more influence??

TTP

But while RBNZ may not come out and predict/publicise booms and busts as such, it does forecast key economic variables and formulates/implements monetary policy accordingly.

Central banks forecast variables in the near term with very tight parameters, but that is not the point. The point is that central banks are not in the business of communicating "what if" scenarios across the spectrum. Just because an institution of authority issues a media release, it is not verification or confirmation of the future. It is simply communicating the output of a limited black box of variables that is meant not to cause alarm or panic.

Surely you know by now that it is Taboo for any official to predict house prices to fall

Hi thegic

There would be a major reputational risk to the RB (or any serious forecaster) if it "overlooked" something as significant as the housing market.

If the RB had a significant concern, it could be expected to at least hint at the problem. Otherwise, it leaves itself exposed - and not just to bloggers!

I can't speak for the RB, of course, but I reckon it's satisfied enough that the Auckland housing market has cooled off - with prices likely to plateau for the foreseeable future.

TTP

lets keep in mind they haven't got inflation #'s right for about the last decade...

I think you are assuming that the RBNZ has a better crystal ball than anyone else.....

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If :-

We cut immigration to reasonable levels
and
We get on top of the current housing backlog
and
We remove the impediments to Auckland growth
and
We restrict foreign speculators coming in here with money that costs them 2% per annum when we pay 5%
and
We get rid of slumlords
and
We stop this nonsense of landbanking
and
Auckland Council stop the rort of charging $15,000 for a water connection
and
Insisting Council on DC levies that double the cost of a section .............

Then we may find ourselves in a city with a high level of home ownership and reasonable prices .

Instead:-

Council gobbles up a huge amount of money and wants more
Is like a massive gravy train where you get to earn way more than the private sector , for doing very little work .

Is run by an idiot whose middle name is TAX .

Right now , we are on hiding to nothing

Great list there Boatman. Perhaps you could add;

Target the RBNZ at 0% inflation

Cut immigration to zero on average.

Broaden the tax base with a very low land tax that very gradually increases each year and is firmly tied to corresponding tax reduction in GST or income tax.

Change the rating system to land value only, not land or land and buildings as the council sees fit, spreading the change over 15 years if necessary.

And don't forget to build sufficient infrastructure to catch up with existing development (waste water, for example), nevermind how one is supposed to manage more build-out...

Exactly, instead of selling the country to new residents and non-residents to the point where nothing works properly anymore and we become ridiculously over crowded, over-regulated and backward, like Britain, who are now looking at installing a train that goes faster than steam trains... by 2026. Japan has had them since 1964.

https://en.wikipedia.org/wiki/LNER_Class_A4_4468_Mallard

https://en.wikipedia.org/wiki/Shinkansen

Then again it is what it is because New Zealanders are easy going and passive. We don't revolt when government is skinning us alive nor had we ever fought and shed blood for our rights and freedom on this land. Everything was handed to us for granted. I see other nations and their people that had gone through civil war or uprising come out stronger than before once law and order is restored. New Zealand needs a revolution!!!!

Other countries are raising there interest rates and it is already having a big effect on there property market. New Zealand is stalling its rates to TRY to prevent a crash. But it will then have to play catch up, creating a fast painful jump in interest rates. You can only manipulate the market for so long, but in the end you have to pay the piper. The dame is filling fast, and it is about to explode.

The crash is coming.

there their they're

Employment growth has been strong and GDP growth is projected to strengthen, with a weaker outlook for housing and construction offset by accommodative monetary policy, the continued high terms of trade, and increased fiscal stimulus.

What RBNZ policy structure will ensure an equitable division of the noted GDP growth returns to worker's pockets at the expense of capital? Read more

Transferring wealth from the majority to a privileged minority via official interest rate artifice is unacceptable and should be terminated today. No political party sought or recieved a mandate to affect such an indefensible scheme directed by unelected officials at the RBNZ.

No mention of uncontrolled and reckless growth of household mortgage debt of 9% per annum, causing the house price boom. No mention of the five years of penury this will inflict.

See figure 2.5 (I'm just slogging my way through this article but it looks like the engine that drives the wheel to me)
https://www.imf.org/en/Publications/GFSR/Issues/2017/09/27/~/media/Files...

Asleep at the wheel doesn't come close. Transferring money from pensioners with modest savings in Nelson to well paid lawyers in Auckland via unnecessary and artificially low interest rates is a disgusting policy.