The RBNZ cuts the OCR by 75 bps in an emergency announcement, next step is a Large Scale Asset Purchase program if more support needed

The RBNZ cuts the OCR by 75 bps in an emergency announcement, next step is a Large Scale Asset Purchase program if more support needed

The Reserve Bank has made an emergency Official Cash Rate (OCR) cut to 0.25%, from 1%, saying the economic outlook has “deteriorated significantly”.

The OCR cut will take effect from March 17. It will remain at 0.25% for at least 12 months.

The Monetary Policy Committee (MPC) also agreed that should further stimulus be required, a large scale asset purchase programme of New Zealand government bonds would be preferable to further OCR reductions.

It noted an OCR of 0.25% was currently the “lower limit, given the operational readiness of the financial system for very low or negative interest rates”.

The MPC said, “It was agreed that, since meeting in February, the outlook for the economy had deteriorated significantly as a result of the impacts of COVID-19.

“The slowdown in the global economy would act as a serious headwind for the New Zealand economy. International and domestic initiatives to limit the spread of the virus would have a serious impact on travel and trade affecting both supply and demand channels in the economy.”

It made the decision following an “extraordinary” session held on March 15 at 2.30pm.

Banks are passing on the OCR cut in full for floating rates. See our mortgage rate tables for the earliest updates.

RBNZ Governor Adrian Orr, at a press conference delivered at 11am, wouldn't say what gross domestic product (GDP) forecasts the RBNZ was working to. 

He also talked about how quickly the situation is moving and that the RBNZ is in a much different position now than what it was last Tuesday when it released a long-standing piece of work on unconventional monetary policy.

Here is a statement from the RBNZ:

The Official Cash Rate (OCR) is 0.25 percent, reduced from 1.0 percent, and will remain at this level for at least the next 12 months.

The negative economic implications of the COVID-19 virus continue to rise warranting further monetary stimulus.

Since the outbreak of the virus, global trade, travel, and business and consumer spending have been curtailed significantly. Increasingly, governments internationally have imposed a variety of restraints on people movement within and across national borders in order to mitigate the virus transmission.

Financial market pricing has responded to these events with declining global equity prices and increased interest rate spreads on traditionally riskier asset classes.

The negative impact on the New Zealand economy is, and will continue to be, significant. Demand for New Zealand’s goods and services will be constrained, as will domestic production. Spending and investment will be subdued for an extended period while the responses to the COVID-19 virus evolve.

Several factors will continue to assist and support economic activity in New Zealand.

New Zealand’s financial system remains sound and our major financial institutions are well capitalised and liquid. The Reserve Bank is also ensuring that the banking system continues to function normally.

The Government is operating an expansionary fiscal policy and has imminent intentions to increase its support with a fiscal package to provide both targeted and broad-based economic stimulus.

The New Zealand dollar exchange rate has also depreciated against our trading partners acting as a partial buffer for export earnings.

And, the Monetary Policy Committee agreed to provide further support with the OCR now at 0.25 percent. The Committee agreed unanimously to keep the OCR at this level for at least 12 months.

The Committee also agreed that should further stimulus be required, a Large Scale Asset Purchase programme of New Zealand government bonds would be preferable to further OCR reductions.

More information:

  • There will be no OCR Review on 25 March 2020
  • Record of Meeting
  • The revised OCR will be effective from 17 March 2020
  • A live-stream of a media conference, with Governor Adrian Orr, will be available on the RBNZ YouTube channel at 11am today.

Here is a record of the MPC's March 15 meeting: 

Members met for an extraordinary session of the Monetary Policy Committee on 15 March at 2.30pm. This meeting was called in response to the rapidly deteriorating economic situation relating to COVID-19.

Staff briefed the Committee on agreed Reserve Bank financial stability measures that were to be announced in co-ordination with any monetary policy decision. The Secretary to the Treasury outlined the broad scale of intended fiscal policy measures in light of the deteriorating economic outlook.

Staff presented indicative scenarios of the impact of COVID-19 developments on the economy. However, it was noted that there is extreme uncertainty around these estimates, and that risks had already shifted to the downside since the scenarios had been finalised.

It was agreed that, since meeting in February, the outlook for the economy had deteriorated significantly as a result of the impacts of COVID-19. The slowdown in the global economy would act as a serious headwind for the New Zealand economy. International and domestic initiatives to limit the spread of the virus would have a serious impact on travel and trade affecting both supply and demand channels in the economy. It was agreed that the Government and the Reserve Bank of New Zealand had a vital role to play in cushioning the economic impact through fiscal, monetary and financial stability measures. The members welcomed the Government fiscal response and the Reserve Bank’s financial stability measures.

The Committee discussed the effectiveness of a monetary policy response given the nature of the economic shock and agreed that a significant easing in monetary policy was required in order to achieve the goals of price stability and maximum sustainable employment. Such a response would also support co-ordinated financial stability measures, and the upcoming announcement of fiscal stimulus.

The members discussed the broad range of Official Cash Rate (OCR) settings that would be suitable. Staff briefed the Committee on the scale of policy stimulus required given deteriorating global conditions and the impact of travel restrictions. The Committee discussed the relative contributions of planned fiscal and financial stability measures in consideration of the monetary policy response. Staff also advised that an OCR of 0.25 percent was currently the lower limit, given the operational readiness of the financial system for very low or negative interest rates.

Subsequent Committee discussion focused on two scenarios:

  • a 0.5 percentage point cut in the OCR to 0.5 percent, followed by an assessment of the rapidly developing COVID-19 situation, with the ability to follow up with more stimulus as needed at the scheduled March OCR review
  • A 0.75 percentage point reduction in the OCR to 0.25 percent.

Members noted that lower interest rates would likely support the soundness of the financial system – in the context of the Committee’s Remit.

Given views on the required level of stimulus given the economic impact of COVID-19, the committee agreed a 0.75 percentage point reduction in the OCR would be a more suitable option.

The Committee then discussed supporting this significant monetary stimulus with forward guidance. Members agreed to provide forward guidance that the OCR would stay at the level of 0.25 percent for at least 12 months. This guidance would also provide clarity to financial market participants that a negative OCR would not be implemented over this period.

The Committee was also briefed by staff on additional monetary tools, and which were likely best suited to providing additional stimulus, noting that the recently published principles recognise the best tool depends on the particular circumstances. Assuming markets are functioning effectively, staff indicated Large Scale Asset Purchases of New Zealand Government bonds were the next best monetary tool available to the Committee. The Committee agreed with this assessment. However, the Committee agreed that additional tools were not needed at this point.

The Committee reached a consensus to:

  • Cut the Official Cash Rate to 0.25 percent.
  • Provide forward guidance that the OCR would remain at 0.25 percent for at least 12 months.
  • Agree that Large Scale Asset Purchases of New Zealand government bonds would be the best additional tool to provide further monetary stimulus in the current situation – if needed.

The committee agreed that the scheduled meeting of the Committee on 25th of March was no longer required.


  • Reserve Bank staff: Adrian Orr, Geoff Bascand, Christian Hawkesby, Yuong Ha
  • External: Bob Buckle, Peter Harris, Caroline Saunders
  • Observer: Caralee McLiesh
  • Secretary: Adam Richardson

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A massive rate cut, brought forward after the RBNZ specifically said they wouldn't bring it forward, and pushed out before the markets open does not exactly scream 'business as usual'.


Debt fuelled froth + complacency = debt driven deflation. Cheap money will not prevent what's coming next. All that was needed was a trigger to set it all in motion. NZ property prices and rents are destined for eye watering falls.

Are there any other ramifications you failed to mention?


AirBnB houses converted to rentals -> further downward pressure on rent

Yep you can expect to see an upwards spike in property listings and rentals in the next few months.

Funny you say that. I just saw a house that has only recently, like within last year or two go back on the market. It was sold last time as a rental earning $400 to $500 per week. At the time I remember discussing it with family and coming to the conclusion that the asking price was far to high. I am guessing it will trigger the bright line test if they do manage to make some money.

Yes you'll see a lot more "Reluctant Landlords" who are basically people who needed to sell their property and couldn't get anyway near the price they were looking for, so they'll choose to rent out their property instead and that will saturate the rental market and create more price competition causing rental prices to deflate a lot more.
That will have a knock on effect with property prices also pushing them downwards. That's the best case scenario.
The worse case scenario is that they banks get in to too much hot water and stop lending, then the property market is really stuffed.

Been living in one of those for a couple of years. Looking to upgrade soon

Agreed. Some"investors" need to understand no one cares what they bought it for. Its only worth what someone wants to pay for it.

Personal circumstances will result in asking price reductions, starting with the most vulnerable/illiquid first.

Not sure about this. People are going to need places to self isolate. You may see a spike in demand from locals.

excellent point
maybe not so big an impact in Auckland, but big in a place like Queenstown
Could be some firesales, I'm sure there will be investors who will be stuffed if they can't attain the average weekly Air B and B rentals that would previously have been expected.

I think this is the end of the #entrepreneur.

Actual entrepreneurs TBC.

As Taleb highlights, surviving an unexpected event is a good delineator between good investors and those who have just been lucky rather than prudent riding a wave up.

Great point

Yes good pt

Mostly a one-track scenario, how property will be impacted negatively to be fair Rp had already stated that. Read carefully I asked for OTHER ramifications.


Well done Poppy. You have taken a lot of unwarranted abuse by numerous commentators that dominate certain threads. For those , and they know who they are, the swinging dick brigade , a day of shame.

Ok, where and how much?


Tourist industry is across NZ. No jobs, no pay, no paying rent. Also the LOTR TV series filming in Auckland has been cancelled so there's a lot of money not flowing in and no jobs.

That's not even accounting for restaurants, bars and cafes that are going to be hit hard.

"eye-watering falls in property prices and rents" I'll ask again, which centres and how much?

Every centre and heaps

If you're not prepared to make some predictions, you're just shooting your mouth off.

You sound like your panicking?

What level of detail would you need ? It is very difficult to predict exact numbers. However I would personally forecast an average 30 to 50% decrease within the next 12 months, concentrated in areas such as:
- Auckland, highly dependent on speculative housing investment, where the housing bubble has inflated the most, and with its housing market highly dependent on immigration
- Tauranga, whose housing bubble is highly correlated with the Auckland market
- Hamilton and Queenstown (as an example), where tourism and exports-oriented business industries are concentrated
But no city is going to be spared: when unemployment is starting to rise significantly and other-indebted investors and owners start defaulting, a tsunami of mortgagee sales is going to hit the market. Time to real estate agents and housing speculators to get a real job (assuming they can find one, in the nasty job market they are going to find themselves in).
I hope that the government will intervene with significant support: it may well be the difference between a simple recession and a depression. In any case, many housing speculators will go belly up - and this is good, so that the market can be restored to a more healthy balance.
By the way, this housing bubble would have exploded anyway, sooner or later: this epidemics is just the catalyst.

No panic, sorry to disappoint. I don't need to see a lot of detail, just some numbers to go with the hyperbole. Let's revisit in 6 months and see how close we got to your 30% to 50%.

For rural property watch milk futures. Big drop last week in US dollars. GDT on the 17th will be interesting.
Futures down again today.

That's to be expected though when the commodity currencies collapse, what matters is the price in NZ$ which may even be higher.

There's nothing comparable from recent times to make an estimate from. Therefore it's only really probabilities. Will it put downward pressure on? Yes. How far will they fall? It is a mystery.

Why don't you shoot your mouth off with your upward price and rent predictions?

Do you always get salty when someone asks you to back up your statements? I don't believe I've ever called for eye-watering price/rent rises either.

It's not my claim. You get salty when I call you out for just making up any old nonsense. You should back up your position by buying more property. Go on there's plenty of nice houses on the market right now. Do you think the prices worth borrowing for?

e: Also the last time you tried to call me out I produced the RBNZ data and you started insulting me.

If it wasn't your claim, why are you chiming in then? I didn't say property isn't going to fall, in my experience when shocks occur it's not the case that rents and prices both fall hard simultaneously. Those who postpone buying then need to rent, and there isn't the housing supply to absorb that without a price response.

I don't recall insulting you, but then I don't recall anything you say.

Dictator, Where did you get the info about the LOTR TV series being cancelled?? There's nothing in the media about that or are you just assuming that it won't be going ahead? Even yesterday there was an article about promoting the series and it being filmed here in NZ.
Article RadioTimes: two weeks initially - but we have already seen that things are very much still in the escalating stage - so i would think much longer term suspension on its way

there really is no industry not likely to face major ramifications - very major ramifications!

Thanks kpnuts. Ok so a temporary two week shutdown and yes that's to be expected give the current climate. Though that's a long way from such a high profile show from being cancelled as Dictator claimed.

It's comments, just run with it.

LOTR TV series isn't cancelled. Production is just halted for 2 weeks. Though presumable that will be extended at a later date.

We are concerned in the film industry though. Basically all the global shows in production are paused. Could be devastating in 6-12 months time for us, if that.

If you're in the tech/CG side of it you can work remotely like we do. But if you're Production/Management staff then yes it's more likely to be a big problem in the long term.


Welcome back RP. I know you’ve copped a fair bit of flack over the past year or so, but now the chickens are coming home to roost! I personally followed your sound advice a while ago, and feel very relieved to not be a first home buyer with a horrendous mortgage. Thank you!

Welcome back RP! Good to see you here.

Rubbish, property is the asset that will retain its value in most places!

How much of it will the trading banks pass on to their mortgage customers and depositors I wonder

Westpac passing on full rate cut only on floating mortgages - given some 80% of mortgages are on fixed terms the OCR move will have little to no impact on economic activity?

Glad I got floating late last year, was pretty sure we'd see OCR at 0.25 or less this year, even without this virus

Which bank are you, bnz has 3.38 fixed one year and 18 months on offer last week. Vs 5.1 percent floating.

Depends on who you bank with HW, We recently paid off the last of our mortgage which had a portion set to a floating rate (A bit less the the standard variable rate).

I'm with BNZ and have two Total Money offset mortgages which are tied to the floating rate. However I get 1% and 0.75% discount off the floating rates for them. So my floating rate with BNZ was 4.30% and 4.55%. That's dropping to 3.55% and 3.80% - not much worse than the fixed offerings.

BNZ. Now will look to lock in with this OCR cut, hopefully we will get a fixed one year at around 3% or just under, but let's see what comes out

I am about to re fix for 1 year with the BNZ so hopefully they will reduced the fixed rates as well as the floating?

It's good. To me this is an ORR-SOME time to borrow money if can find the right investment. Have been taking a gander at a few places (ps not houses so breathe easy)


The games over for Orr and his team, now irretrievably exposed as being completely out of their depth. I have followed The RBNZ closely over the years and never had such little confidence in a regime as the current. As Michael Riddell said, game over.

tend to agree.... failing miserably. Bank oversight is atrocious and their comm's and mgmt of the OCR over the last 6 months has been diabolical.

Orr gives very few, to no, on the record speeches, no release of speeches made to private audiences, truculent, stubborn etc etc. Now completely over-run by the scale of events. I have issues around their use of Maori symbolism as well, but that's another story


What business is going to borrow with all the uncertainty? Maybe Sanitizer makers and medical supplies

Funny you should say that, the UK Government is currently talking to carmakers to persuade them to make ventilators instead. "Matt Hancock has called on British manufacturers to consider switching parts of their production to the making of medical ventilators needed to treat rising numbers of coronavirus patients". Article from The Guardian: Coronavirus: UK manufacturers urged to consider switching to making ventilators


Central banks are not banks at all, they are governments without any natural constituency. As I wrote elsewhere today, the absolutely perfect week to be bringing up Walter Bagehot, the thing has devolved exactly as he discussed back in 1867 (writing about governments rather than central banks).

It is an inevitable defect, that bureaucrats will care more for routine than for results; Their whole education and all the habit of their lives make them do so.

What is modern central banks but their routine of botched QE’s? Link

Beautifully written.

The RBNZ cuts the OCR by 75 bps in an emergency announcement, next step is a Large Scale Asset Purchase program if more support needed

The RBNZ has cut interest rates in half five times since the middle of 2008 - is it already threatening to engage an LSAP program due to expected and witnessed interest rate "stimulus" policy failure?

Can we please dispense with all notions that monetary policy works? Specifically balance sheet expansion via any scale asset purchase programs. Nowhere has that been more apparent than Japan. Go back and reread all the promised benefits from BoJ’s Big Bang QQE that were confidently written in 2013. The biggest bazooka ever conceived has fallen short in every conceivable way.

Starting with the fact QQE remains ongoing approaching its seventh birthday. Over here in the real world, if you have to keep doing it there’s no way you can claim it was effective. Well, you can claim such a thing but normally you’d be laughed out of respectable society. Link

Something went wrong with the architecture of banking. It has deep roots and was the mechanism whereby Wall Street and the US took financial power and wealth from Britain. The Federal Reserve was conceived with this in mind, just as the Euro was conceived as a way for France to get power back from the US.

Michael Hudson says that prior to WW1, trade finance and working capital were funded directly (ie peer to peer) against invoicing using Bills of Payment. Sort of peer to peer invoice discounting, the origin of the phrase "payment on the nail". The US and JP Morgan seem to have engineered a change in the architecture of banking so that trade finance and working capital finance changed to bank loans.

At the same time the US broke the lomg standing European tradition of writing off inter-ally debts after a major conflict, on the basis that one country had paid more in blood and another had paid more in treasure. Thus the US required France and Britain to repay their war debts from WW1. This in turn required Germany to pay reparations to France and Britain. Thus the US and JP Morgan created the economic conditions that led to WW2.


I don't think they have enough resources to beat this.


I dunno about this one.
We are now squarely caught up in a race to the bottom.

It seems regardless of what economic shocks manifest as, the response is now always 'cut interest rates'.
Not any way in hell this is a temporary 12 month measure.

There we agree.

Growth on a finite planet wasn't possible and we were up over the top of the curve. Couldn't pick the trigger but we could sure pick the trend.


This is not a 'limits to growth' thing, PDK. This is a shock to growth approaching the limit - two very different things.
Stop trying to mold it to suit the same old narrative.

Denial comes in many forms


Oh god.
Spare us the sanctimony.

You have every chance to become informed.

I'm surprised you're still around, after the last exchange. Sorry but disruptive ideas tend to have a greater chance than the current narrative, of being correct in the face of change. Darwin, all that. Good luck with the prayer session

So you reckon you are "informed"... ah well say no more.


He is one of the anointed, enlightened few.
Yet calls everyone else a zealot.


The last exchange? why do you keep referring to that? It made you look like a fool who never did 5th form maths.
I still remember - you gave the reason why infinite growth is impossible is because of 'diminishing returns', when 'diminishing returns' is the exact proof as to why growth is infinite.


I rest my case. Thank you for stating your nonsense so clearly.

Diminishing returns (in energy usage) result in infinite growth (in consumption). Is that your position?

Stap me. The economics teaching profession should hang its head and weep.

Given a total resource endowment, growth in overall consumption of that resource is in theory infinite. There is a simple and intuitive mathematical reason for this, which you should understand. The example is transferable to anything that has a limit; 'returns to energy', 'returns to consumption', or whatever.
So, stop looking like a fool and do your assigned homework - plot ln(x). Or, just take the first derivative of ln(x) and that may highlight to you why 'diminishing returns' implies an infinite growth path.
Once you have, let us know.


Never has 'putting out the fire with gasoline' sounded more appropriate...

Yep, they're going to pump up asset prices. AGAIN.

Someone above seems to think asset prices will drop. I’d put it at long odds, but am still of 2 minds as to if I should sink money into shares once the drops appears to have stabilised or wait a bit for These alleged real estate price drops and buy real estate instead.


My daughter and her husband are with Disney and her job is hanging by a thread, one case and it's all going to be closed down, 100's of jobs gone.
Monetary policy is not the tool to solve this. We had a recession coming anyway, this just collided like massive clouds in a storm, you can feel the thunder.

What do you mean “with Disney”? Where? The United States? They have already shut down all their theme parks, cruises and tv/film productions temporarily. They still have plenty of revenue pouring in from their tv networks & streaming properties of course.

AKL, She just needs Mr Orr to magic up her a job.

This be 2008?



No, 2008. We haven't fixed the problem since, because we couldn't.

1929; there were only 2 billion on the planet, most of the oil and much of the best-quality resources, were still in the ground.

2008; 6.7 billion, more of 'em consuming, half - the best half - of the oil gone, and every resource heading for dregsville.


the other HUGE difference from 1929 is that people were tough, local focused, practical, capable and still linked to the land by and large
None of which now holds true

The other big difference to 1929 and now is that fossil fuels were scarcer in terms of technically recoverable reserves.
And the the catalyst was a completely different shock

But hey, let us not allow facts to get in the way of your revered narrative of limits to growth.

There, readers, we see the stupidity that passes for economics.

Fossil oil is - as its very name tells us - finite. So we're depleting a one-off stock, and doing so at exponentially-increasing rates.

The truth is that we have less now than we did then. Regardless of which now, and which then.

But by economic counting, we have more. Take that stupidity to its illogical conclusion and we get Julian Simon asserting that copper is all in our minds. Just because we have discovered more of the resource than we had done (remembering that discoveries peaked back in 1964) doesn't mean there was more of it.

There are physical limits to growth. There appear to be no limits to self-delusion.

Fossil oil is - as its very name tells us - finite. So we're depleting a one-off stock, and doing so at exponentially-increasing rates.

There, readers is the stupidity that arises when we ignore one important concept in economics - 'technically'. Coming from the term technology.
It allows those who have a high school education to reconcile the difference between absolute scarcity and effective scarcity of a finite resource. We also tech in high school economics and mathematics why exponential growth is a transitory phenomenon and why extrapolating long run growth from the derivative at any point of a concave function makes the analyst look like a fool.

You need a big energy surplus to train those technicians and keep them employed.

and the MASSIVE requirement for a Debt buildup in the absence of energy surplus?
a fool is someone who cant see the wood for the trees

theres technically recoverable reserves on Mars
wanna make a business case to get some?

Citation please.

Actually, he's just acknowledged that there are limits to growth

Which is all I was saying

Whether this event is the re-set trigger is the only question in town. We should be asking energy analysts though, not economists.

If you keep shouting wolf you will eventually be right.

We just have to listen to your shouting for years upon years first.

Isn’t this what they are doing in the USA? Mnuchin has said the markets will Receive unlimited financial support.....doesn’t seem to be working to instill confidence over there, why are we different? Looks like a big game of follow my leader! Watch out for the cliff!

Outlook must be bad with the OCR cut ahead of schedule. House prices will def be on a downward slope and I would say auctions will now be rare except for mortgagee sales which will be drip feed on to market at first.
Anyone buying now needs to make sure they factor in a 10-20 percent price drop.

Why only 10-20%? A few years ago in Las Vegas my cousin showed us a posh housing estate and told us that his colleague had bought a $750,000 (USD) property for 60% discount. What is different with NZ? Our home has a CV based on 80% land and 20% house - isn't it quite possible for the land component to shrink to 5% and our $1.2m house to be worth $250,000? We are mortgage free however judging by comments a 65% drop in property values would affect some readers.

Agree I was just playing it safe 10-20 % for sure but I was thinking back to 2008 prices would be a good medium term say 2 years target versus
10-20 percent next 3 months.

You will be giving them conniptions for breakfast.

I wouldn't be surpised if this recession gets serious, that we see a 50% fall in property prices (but I've been saying that for about 5 years now not knowing when the recession/reset would hit....perhaps its closer now).

After 1929 some Florida properties lost value and did not recover until the late sixties. So your $2m home in Auckland may return to that value in 2060 by which time if it has sea views now it might be underwater.

Yes - I enjoyed (I'm sick...) reading Robert Shillers 'Irrational Exuberance', especially the section on past housing bubbles. What we think we know and the stories we tell ourselves to convince our wiser selves that irrationality is rational, can be rather scary.

So big mortgages on a depreciating asset..... many should be worried!


Yip - if I were a FHB in say Auckland the last 2-3 years and had a large amount of debt, I'd be shitting myself right now. But then again, those that I know who were FHB in Auckland in the last 2-3 years appeared to have no idea of the risks involved and probably still don't, even now.

Ignorance is bliss?

Not ignorance. I was getting old, much older than my parents were when they started families. I couldn't put my life on hold any longer waiting for a hypothetical correction that might have been years away. Turns out it was closer than we thought.

Property prices are indeed likely to come down.
BUT would you rather still have your deposit in cash /shares ? I think not.
Add to that that you mortgage is likely to be inflated away and you are in an OK place - provided you can keep up with the payments in the meanwhile ; this is the tough part of course.

Nope, I managed to get out of the Chinese credit crunch and come out the other side better off with strategic fund movements. It's the only reason I was able to get a deposit together in the first place.

I'm not proud. I like my job but if I have to get on the forks again to keep a roof over my head and work nightshifts, so be it.

Especially as job losses filter through to the housing market, probably 6 months away


Remember all the “doom and gloom merchants”who were questioning the logic of keeping interest rates so low for 11 years, at previous emergency levels, really for the purpose of pumping assets prices? Now look st the situation we have. A real shock and emergency again, and nothing left in the tank.

One thinks we need to have a new look at how we manage our markets/economy. What we've seen the last 20 years is madness. Boom....bust....boom....bust.

Why not just have steady growth of money supply and allow markets to fluctuate around that? It would appear central bank behaviour makes things worse, not better.

Because money ends in consumption.

So you'd need a steady growth in supply of processed parts of the planet.

Have you noticed it getting steadily bigger, perchance?

Nothing wrong with Boom Bust cycle, happens in nature all the time (forest fire renewal as an example). Central bank policy has just prevented the last bust, and that is artificial event.


by Cowpat | 6th Mar 20, 4:26pm
"If Wall St falls tonight , RBNZ will get the nod and cut OCR Monday morning ."

by Yvil | 6th Mar 20, 9:09pm
'We shall find out next week if Orr reduces the OCR, something tells me you'll be full of excuses if he doesn't"
by Yvil | 6th Mar 20, 6:10pm
"Thanks for sharing your insider knowledge Cowpat, did Adrian Orr tell you in person?"


Ha-ha-ha :)


The end of the New Zealand property cult.

I don't know about that. Seems to me like every possible form of social aid will be thrown at the housing market to attempt to prevent older folk from having to suffer any loss. This is the "good" type of socialism, of course, not the bad type of giving money to poor bludgers. The last thing we want is MPs and folk with property portfolios having to wear the downside of risks they took in investment. That's for young and future taxpayers to pay for, that is.

Tomorrow's announcement will be critical in terms of the near term future of the housing market.
If it can stave off large rises in unemployment, then the market might only just survive.
But you can right-off any meaningful price increases for at least 1-2 years.
Even with a massive spend, I am picking a drop of 3-5% in the main centres, and more than 10-15% in tourist towns like Queenstown. I would be feeling very uneasy if I owned highly leveraged Qtown property.

Agree Rick

The whole premise is to ride this out and return to the status quo with all previous equity intact and just as unaffordable for FHB to buy a house.

And then to repeat this every time something like this happens every decade or two.

Don't think so.



OMG, he was going on about that all week, like you owed him an apology for telling us how you saw it.



Another absolutely clueless example of "when you have a hammer, every problem is a nail."

Exceptionally leveraged systems don't have a stable equilibrium unless the whole apparatus gets a purge to flush out the dross every now and again. It is because of laxity on rates that we (as a country) have preference for real estate speculation versus productive, especially secondary industries for the incremental dollar of capital.

So next they're going to fill the waka with government bonds and in due course monetise them by inflating the Kiwi dollar away into oblivion - Zero sum game where by hook or by crook the middle class, or what's left of it, ends up getting hollowed out like our buddies across the Pacific.

If you want to intervene in the currency, why not just do a Fiji-style devaluation and call a spade a spade.

Good luck to all those relying on interest income.


I am curious as to what they expect this rate cut to deliver? they call it 'stimulus' but what is it stimulating? There is no regulation that I am aware of that allows them to direct the banks to drive money in a particular direction, so this kind of looks like a bunch of punters at the races throwing rocks at the horses in the hope that they will hit the right horse to make it go faster in the right direction.


Robertson is advocating debt.

Given that debt is an expectation that the future will do the re-paying, this is theft from future generations.

Worse, if it was acknowledged (and we can see classic avoidance upthread) that future generations won't have the energy and resources to do the repaying, then it can arguably be described as fraud.

But the present sets up its own rules in its own courts, so will never charge itself. Which just leaves the question of whether this is the trigger event, or merely a saw-took down-shift.

It's fairly obvious he is advocating debt, or at least the RBNZ is. But to what end? That might just lead to a spike in house prices, but the banks may not even pass the cut on, especially if their funding comes from other sources which are not affected by any noise from the RBNZ. In the mean time an awful lot of business around the world is grinding to a standstill, so a lot of bank debt will become 'distressed'. In my view I think it will be possible that the banks will look at spreading their risk, possibly trying to mitigate some of their losses, so the consequences may actually result in an increase in interest in loan interest for many borrowers.

There is a good chance that quite a number of mortgage holders will not be able to meet their payments if their jobs come under threat and neither the RBNZ nor the Government have the legal means to compel the banks to be lenient towards their borrowers. They can of course appeal to their 'community spirit' or some other factor, but the banks are private business's and will operate in their best interests, that is of the shareholders, and this is so often short sighted.

Apparently KiwiSaver can be used to pay your mortgage if you are in Financial distress. This may serve to stagger the arrival of real estate to the market which may mean that we do not get as lucrative buying opportunities as we are hoping for.

Certainly looks pretty morally bankrupt.

Folk in the future won't have the spending ability that comes from having a house paid off earlier, because of this and having to take on larger and larger debt. That spending won't then flow through the local economy. Instead, it'll continue to flow out to foreign banks. And it's not investment in production, just in housing.

All this so folk can live larger and party on right now.


My position on this, after years of reflection during this bull market, is that low interest rates were meant to increase growth in GDP terms, but in reality they just flowed into asset prices not measured by CPI. Lower interest rates with higher money supply, should have resulted in inflation, but where is the inflation? (in asset prices).

We need/ed to focus on productivity to improve growth, not just drop interest rates. Incentives have been focused on asset speculation (debt fueled property) and humans have been humans.

"We need/ed to focus on productivity to improve growth .."

So everyone kept saying for the last 40 years .. talk is cheap, credit far easier
Diminishing returns is just too hard a workaround
And as animals we heavily discount the future in favour of the present

I've been pointing out that productivity gains are energy-efficiency gains, for a decade here.

Slow learning, it is being.

The belief is strong in those ones

This was inevitable, and will generate minimal benefit.
Tomorrow is the key. Let's see what's delivered.
Might this be 'the year of delivery'?

I wouldn't hold your breath.
Be interesting to see the immigration figures in coming months. I suspect the housing shortage will be solved with low wage workers fleeing the country. (If they can get a flight )

Yes this is pretty key.

Will there still be cafe/restaurant type jobs available? Maybe not if people stay away from these places.

And what about classrooms filled with students from overseas here for english lessons (but really here for residency and part time work). Will those classrooms be shut?

I did not see that coming.
Crazy times, though really just the recession we should have had in 09.

We did have a recession in 2008-2009 and it hit house prices/sharemarkets and the dollar hard. This time I think will be much worse more like 1929??

Sorry I should have stated ocr cut, not recession.
I did not see it being cut .75, that is massive.
Time to dig my bunker?

Be ready for mass amount of mortgagee sales. House prices will drop by 50%. This will be the financial end of many house speculators.

I aren't sure what makes you think this will happen, at least in the short term. I expect a short term (3 months) pump to house prices. After that if unemployment rises, then you might be right...

The recent talk, all the last 3 months or so (which I found odd), among the boomers I know, has been now is time for them to sell their family homes and down size for retirement. What this means for the property market, and whether this is just a coincidence that multiple boomers about to retire have talked to me about recently, I'm not sure.

Almost certain there will be mortgage relief for FHBs in the package tomorrow now.

First home buyers or first home owners?

Possibly both.

Bleedin communists. So much for people standing on their own two feet.

I do not see a %50 drop? Housing still a good investment.. Until people cannot pay the rent, then i expect the government will step in and pay the rent in the form of a UBI.


"Until people cannot pay the rent"

I don't think that will be to far away. An awful lot of jobs are about to disappear.

In that case just bring back state owned welfare housing?

Yes .. we will call it accommodation supplements...

I have been waiting the last year for this bubble pop.
I sold everything last year when people started telling me that they thought house prices were at bubble levels and I thought that when people start saying the word bubble it was close to top.
The sharemarket was much easier to see just look at the charts from 2015 to now even my 8 year old was saying why is chart going straight up
and I said greed above logic.

Watch the listing numbers explode as some try to exit and take profits

Interesting times, the move by our Government yesterday was appropriate ( no use arguing that it should/could have been earlier ) and in 14 days time we will have a clear picture how NZ sits with virus cases. RBNZ also making an appropriate move this morning.
I feel optimistic for the future of NZ given to date the number of cases, new containment measures, the state of Government debt allowing massive headroom for financial stimulus compared to other countries and our isolation being an island.
If this beast can be contained and we weather this out, NZ will be in the best possible position to bounce back on the recovery side.
I think everyone commenting on this site should be thinking about how they individually can be supporting themselves, families and wider communities rather than posting negative comments.
Let's get behind our Government we are all in this together.

Agreed but with provisos.

Pulling together and community support are indeed essential. A pity these were trashed by the dog-eat-dogism which increased since 1984.

But 'bounce back' and 'recovery' are misnomers. The growth phase really only got into gear post WW2, and was already in trouble by 1970. It was always temporary. Thus the recent increase of debt-to-GDP, and the fierce need to believe GDP (which lies to the point where it valued the Chch rebuild as a positive).

We were due the Limits to Growth re-set hereabouts and it only needed a trigger. I've never seen a more likely candidate than this one. Some of us have been contemplating the much-more-local, much-more-inclusive societal formats we will need beyond the denouement. Our efforts haven't had much airplay (funny, that) but the concepts are well-gelled.

Could you do a guest article for I see quite a few guest articles on here, would be good to understand the new model you are talking about!

What I'm waiting to see, is whether to degree of FOMO we've seen in property the last 10 years post GFC, turns into FOGO (Fear of Getting Out) in the same intensity. We will see.

6 months ago i took all my money out of the bank and put it in a credit union. My safety deposit box has some cash and bullion.

If i could advise people to get some cash out and store it.

The central bank global takeover is happening. They planned it all along! Central banks want to become the lender and borrower of last resort. To enact their final solution. By the end of the year a new system will emerge including global UBI.

Isn't money going to get deflated away again?

The printing presses will start up again and if you're holding paper money in a safety deposit box, it'd be losing value by the day wouldn't it?

"Click" Did i hear the sound of an empty rifle? Load up the QE rounds.

No it wasn't a rifle bolt click, more like the pin of the grnade being pulled.

No it's "Click..... click, click, click, click - what the f**k the damn thing's broken!"


What happens to those here on work visas who lose their jobs due to CV19 caused layoffs ? For how long can they stay in NZ, are they eligible for welfare etc ? I’d appreciate someone with knowledge of the system clarifying this for me. Interested too on thoughts about the impact on housing demand if large numbers are forced to head home.


I've been wondering this too. The number of people on work visas currently sits at around 500k. If unemployment ticks up it seems like that could cause a pretty big drop in population.

Sounds like Ireland - what housing supply shortage?

However we could lose 500k on work visas and find them replaced by 1m emigre Kiwis.

Rents are going to be hit, that's for sure.
Prices too, but maybe less so

Every asset group is taking a hiding. I dont see property being any different.

This difference though with property compared to other assets is the amount of relationship stress it causes. Some will be willing to sell at a reduced rate just to see the back of the effing thing.

Mortgage costs also lower for most investors :) I think they can weather it.

does uber driver count as employed? or are they considered a independent small business

Ok. So let's look for a reason for this cut.
Fear of mass Default.
At virtually zero% (and a bank will 'lend' at that with the certainty of 12 months if the penalty funding cost is the OCR+) bust debtors can be kept on the books until such time as they can be quietly sorted. Kiwisaver Funds can be kept 'solvent'.
They will be corporates ( Air NZ,?, Fonterra?), Households ( mortgagors) and individuals ( personal debt holidays).
So if that is the reason - New Zealand, amongst all the rest, is in real strife.
My personal view and action remains unchanged -
"All asset prices are going to fall - all of them" and
"Borrow all you can, and don't spend it ( that's the hard bit!); Offset it. Keep it for later on when all asset prices fall". Credit rationing it coming.

That 0% is only if the bank's funding source is the RBNZ. What if it's some US, European, or Asian bank with a different view of risk?

"Credit rationing it coming"

Damn straight it is!!!

Lowering interest rates isn’t going to work - we’re steering down the barrel of both demand and supply shocks.

yip - its the supply shock that's going to slap us in the face
rationing will be back in vogue big time

How much of it will the trading banks pass on to their mortgage customers and depositors I wonder

you could see the recession and the cut coming, i had a CEO redo his mortgage for five years a couple of weeks ago because he was calling rates to rise with this, a colleague asked me as they were doing there and i said the opposite will happen rates will fall so they fixed for a year, maybe should have gone shorter but a year should about right at the moment as we will know where we are and the should get a better rate at the end of it
makes me wonder about my company with a CEO that can be so wrong on rates.
as an aside i can warn that goods airfreighted in costs will triple as flights are cut so lack of space, but by sea rates will drop.
and my pick 4 quarters of recession.
maybe the silver lining is cut to immigration to zero for a period

It does not matter who long you fix it. If, in the near future, you have no money to pay because you lose your job or your business goes bust, or if you get into negative equity because your house depreciate hugely, how long you fix is not going to make a iota of a difference.

That is an AK 47 attack on the OCR. Hope the victims dodge some bullets.
Is the Sheriff happy ?

At least now they can say they did "something" even if what they did was low impact.

Let's hope the fiscal response is better at keeping consumers spending.

I think everyone will do the opposite.

Retirees will tighten their belts, small businesses are not going to spend at the moment.

No time to upgrade your ute when recession is on the horizon...

I agree with those above that house prices will come off as unemployment creeps in. Buyers will hesitate over the coming months and those in financial trouble will need to sell. Rents may even drop in some areas.

However, we will be heading to auctions and putting in low bids, as we did after 2008 crash, as we have cash and will be looking for yield. With interest rates heading to 3% or below that certainly makes current low rental yields more attractive. Powerful interest groups around the world will continue to be in favour of inflating asset prices vs other possible solutions to an economic downturn and if you are smart in how you buy over the next 12 months there is a good probability you will win long-term.

It will be interesting to see if the country over reacts and adopts scorched earth policy to employees which will mean theres nothing left to resume business with once the pandemic declines. Much like what occurred in the construction sector post gfc...although a lot of that blame could be laid at the feet of the Key govt which did precisely nothing to support the sector. However, I think that our isolated location is a strategic advantage in this situation. Especially tourism, once the infection curve flattens out its entirely possible that demand to visit NZ will RISE as people see we are far from the epicentre and relatively unaffected and safe to visit...

That 'they'll come back' meme does rather assume that the carriers (airlines, cruises etc) are still around in any numbers. Big assumption.

First straw in the wind: AirNZ lops 85% of long-haul....

"We are a nimble airline with a lean cost base, strong balance sheet, good cash reserves, an outstanding brand and a team going above and beyond every day. We also have supportive partners. We are also in discussions with the Government at this time."

Let's translate the bolded bit: "We are in deep doo-doo and want yer assurance of Magic Munny Tree fruit when we ask..."


Maybe, just Maybe now we will get some focus on Shane Jones "psuedo students" and free up possibly 3000 jobs at NZ petrol stations else we will have a massive youth unemployment issue.
This scam has gone on for too long and getting rid of it will also free up 2 or 3 houses in Mt Roskill

That scam is under full frontal assault by MBIENZ inspectorate. I was in my local bottle o recently and the indian owner of the store now works on the till these days because he has to pay his staff properly so he has let some of them go, presumeably to return to mumbai to work for microsoft virus detection services.... Interestingly enough he was discussing a job with a young kiwi person while I was looking at a bottle of scotch....

Liqour shops and bottle stores, ethnic restaurants, pizza hutt and dominos franchisees and assorted fast food outlets, kiwifruit contractors, pip fruit contractors, gas stations......

hammer .. nail.. bang on there Smalltown

The epicentre is going to pogo stick all over the place in the coming weeks and months

Unless he's got a magic formula to create jobs he's pretty much useless. China has a major problem due it's businesses being geared up to export, while the importers have all had heart attacks, leaving China with big problem.

In my business everyone I talk to is shutting down but we are also in the mist of an historic drought. This is going to be about jobs and cost of living, out of kilter with real productive economy.

Xinhua spouting the other day that China should leave the USA to "drown in a deep sea of Corona Virus."
Maybe they haven't heard of the phrase "Never bite the hand that feeds you."
Speaking with friends in China, they seem to think that this is now over for them and it is back to life as usual. I think this is unlikely, who it going to buy your plastic doodads now?

and this virus will come back next year for anyone it missed this, the globalised world has delivered the unexpected.

If the virus comes back next year then who cares as there will be a medical solution by then.

Where is the medical solution for SARS? Remind me how long ago was that?

I dont know about sars but certainly swine flu H1N1 which could be a combination of sars and something else. Sars is 20 years ago, not an everyday or every year occurrence

It will be re-entering China as we speak, China hasnt closed its borders!!!

Well if you haven't already, time to get the cash out of the bank.

And put it where?

Consumables - Fuel, Food, medicine, stationary, clothing, toilet paper ;-)

All are immensely valuable in a crisis.

Friends in Argentina in the crash around the millennium found that they could trade a pencil for accommodation, fuel, even food. People wanted to write IOUs for everything, so writing tools became hot property.

Woo Hoo I have a draw full of pens and box full of as new unsharpened builders pencils to swap for a 4 bedroom+ house/mansion in Epsom. Reply here if you want to do a swap.

Throw in some bog roll, dust masks, and a netflix subscription and you might get more bites.

Medicine and amunition

My so called financial adviser has told me to get into metals. Tinned food, ammo and barbed wire.

There is been no reported incidence of violence in regard to this virus. I don't think ammunition is a priority.

See how the USA pans out in another 7-10 days. [sarc]
But by all accounts it is actually very civil. I think most people understand the severity of the situation.

Except for the knife pulled during a tussle for toilet paper in Oz. The Singaporean student punched in the head in London. The cruise passengers abused and hit with rocks.

Well, there goes my first prediction for this year (no OCR cuts). And there goes my term deposit money... into my socks drawer.

Good luck courtjester

You better act fast because physical currency restrictions will be in place very shortly. Because after all teens and 80 year olds only need 2k right??

In Australia the currency restriction act has become law despite massive opposition to it. Using 10k cash gets you 2 years jail. The legislation is written that the treasury can make amendments without parliamentary consent. Ie lower it to a thousand or apply it to deposit and withdrawal.

Mr Orr recently said cash would be protected but he was clever. Reference to teens and retirees using cash. So a limit of say 2k will be law in nz soon. Jacinda will run with the "black economy " narrative.

Negative rates and cash restrictions coming soon.

Don't see it getting to that PoziKiwi.

What your suggesting is society dropping to a near Mad Max level where you need to worry more about armed marauders taking what little you have left than getting the Coronavirus and being put in the ICU.

Your not going to need any cash anyway, how much can you spend while we are in total lockdown ? your only going to be allowed out to the supermarket to buy food.

They can't introduce a cash hording limit here due to NZ not having any Savers Protection Scheme as Australia has. We're still the only country in the Western world not to have one.

The lack of deposit insurance is what I'm worried about most. What are the odds of the big banks bailing in this year? How does that look in practice? Do I lose 5% of my term deposits, or 50%? So many questions no one can actually answer with certainty.

All I know is it would be a very hefty "hair cut" depending on the severity of the bank going down. The thing that annoys me is our Government had got to the stage of saying they were fully committed in to introducing a scheme to protect savers, and now that seems to have fallen by the wayside.

I sense that the Big Four are the ones at risk the most since if their NZ arm goes down then they don't need to pay out to their saver customers do they.

might be worth spending -- as next stage will be getting those printing presses back up to full speed and devaluing currency -

Anyone pointed out that thanks to old Don Key -- we have incredibly low debt to GDP ratios -- and were starting to run surpluses -- so we have a lot more wriggld room than most countries --

wonder if Jacinda and Grants performance will stack up as well in like for like comparisons!

Tourism is dead. What we need now is rain to make grass grow because our best hope for the economy are those nasty carbon emitting farmers.

Nobody will thank them but they are are the ones who will keep the economy going.

exporting to whom exactly ?

The world still has to eat.

are you talking Red cross style food parcels?
last I looked capitalism was bust

wow , the cut of 0.75% eventuated into +1.36% of NZD to USD . Interesting

Never mind Stuff has reported Z as slashing (?) fuel prices by 5c. Surely they mean " continuing the gouging and cartel pricing "

With Saudi supposedly selling oil at $25 and Victoria last week averaging 91 at $1.20 we should see at least 30 cents off the price in a fair market.
Who is the energy minister? Time to do something on the War Footing we are now on is NOW or STFU forever.

Jacinda: "Don't worry I've got it all under control":

going to smile and hug all the sufferers and the newly unemployed -- should sort it out !

No new cases today - glad we have a smart team at the helm (rather than the wombats on these threads)

That comment insults wombats

Interesting to see so many here predicting a property market collapse. It will not collapse, the market may have a short term hit / slow down by Covid 19 but will soon hit a new high as covid 19 start to go way. One big fact many seem to miss when making their predictions is where should this cheap money go? Also the low interest rate is going to last for many years to come. As for FHBs it is good time to take the advantage when there is a bargain you can find.

You forgot about the upcoming surge in unemployment. There's gonna be a few billion dollars missing from the people's pockets (mainly due to loss off tourism) this year. Including thousands of people with mortgages.
We also have a record amount of new builds in the pipeline, and immigration is going to take a massive hit. Who's gonna buy all those houses?
Also, as I mentioned above, income from AirBnB will be zero for a year or so for many. Owners of those properties can either try to sell, or convert them to rentals. One puts downward pressure an house prices, the other one on rental yields (which then translates to house prices).

The money could come from offshore again. Last time around the Chinese and others printed a s**t ton of money and went around the world spending it.

Now, we do have a foreign buyer ban. But a few countries are excepted, and new builds are still able to be bought.

You sure we're not going to see billions come into NZ to buy off the plan apartments, sections etc.?

Buying off the plans increases supply. When immigration grinds to a halt (due to quarantines, fear of traveling and many people here on temp visas losing their jobs) we will already have a surplus of housing.

i hear you -- ,but its so hard to try and predict -- for example -- all the free money could inflate housing -- as nowhere else looks good to invest -- but 30000 new rentals from air bnb -- plus virtually zero immigration for 12-18 months -- and maybe we ease teh housing crisis -- afterall that would be a swing of about 50000+ new rentals in just over a year

but then -- look at the inflationary prospects -- if we cant import enough goods -- if countries cant manufacture enough -- everything will rise -- except basic food which we should end up with a massive surplus of met dairy products seasonal fruit - wine etc

also quantitative easing -- inflationary

quite simply -- i dont think anyone can actually predict with any certainty - it will be about survival of the quickest thinkers - swiftest movers and those who adjust - as it always is in a recession !

hell i was thinking about retiring in next three months -- now thinking i should hang on a bit -- especially as my job secure as ..... houses hmmm

Time to put the Ranger up for sale and bring out the Great Wall.

Crazy to see brand new Great Walls with all the copied from Toyota features cheaper than some of the similar but used ones on Trade Me. Deflation is on the way I think.

It really doesn't matter what the RBNZ does or what the mortgage rates are in NZ, interest editors.

#FED #LiquidityEvent

Zerohedge characterises the LSAP suggestion as 'Kiwi QE'......

The man can not see why house prices are going to get a hammering!
Housing is still the safest investment asset by far!
Yes the number of sales will be down but why on earth would people be selling at this time?
Investors will being doing just fine if they are positively geared and most have good equity!
Personally if some panic and the numbers add up then we will be buying in Christchurch where it will be steady as she goes.
I believe that if anything that ChCh average will go up as the cheaper houses won’t be getting sold as much due to the first home buyers not having as much KiwiSaver for their deposit!
Most of you bloggers that are not house owners are just hoping there is a crash but that wont be happening in most parts of NZ,
Auckland property may well come back due to overseas buyers needing their money back home.
I would be far more worried about people’s jobs and their KiwiSaver balances than being so concerned for professional financial savvy property investors!
Don’t bother Gordon!,

"Investors will being doing just fine if they are positively geared and most have good equity!"
See, this is a very big IF. So many people got so greedy in the past few years, taking out huge loans to buy their n-th investment property with no business plan other than "house prices always go up yo", only expecting capital gains. Yields are around 3-4% in Auckland now. Immigration will grind to a halt pretty much overnight, pushing demand lower. Lots of AirBnB's are going to be converted to rentals, pushing rents lower.

Jester, you shouldn’t be buying anything that returns only 3 to 4 % as you are not investing!
Investing means positive returns from an asset if negative it is purely speculative.
Yes you could struggle for a while if you have been buying on pure speculation but most property investors around the country are going to be just fine.
The bigger worry is the ones who were relying on KiwiSaver as they have been invested in the gambling sharemarket.

We can all smell the fear in your comments The Boy. Personally I am heavily cashed up as I sold 99% of my shares in November. But I won't be buying rentals. Selective buying of shares in small amounts might begin in a month or so time. The Reserve Banks do not take large measures as shown in the States and New Zealand today because they are good guys. They know the world economy as a whole is going to be hit hard. A long and hard recession is being talked about. No asset class is safe.

Housing is still the safest investment asset by far! - Agreed
Yes the number of sales will be down but why on earth would people be selling at this time? We might have something to sell in a month and will keep you updated
Investors will being doing just fine if they are positively geared and most have good equity! - Agreed
I believe that if anything that ChCh average will go up as the cheaper houses won’t be getting sold as much due to the first home buyers not having as much KiwiSaver for their deposit!
Most of you bloggers that are not house owners are just hoping there is a crash but that wont be happening in most parts of NZ, - Agreed
Auckland property may well come back due to overseas buyers needing their money back home.
I would be far more worried about people’s jobs and their KiwiSaver balances than being so concerned for professional financial savvy property investors! - Agreed
Don’t bother Gordon!, AGREED

My understanding is that we need for the virus to go through almost all the population (herd immunity) at a rate that allows us to 'flatten the curve' ie at a rate that our medical facilities can cope with.

This graph explains it.

But the reality is no know what that 'turn tap on turn tap of' looks like to achieve that. Every country in the world has failed so far to regulate that, except maybe Singapore and Hong Kong if you believe the reporting.

It could be argued that we don't either, in that we should have more cases by now to use what is at the moment excess capacity in our hospitals prior to winter.

Keeping it out is not what we are trying to do. We are trying to let it in at a controlled rate.

But what it means is we know our curve capacity, and therefore can calculate how long these restrictions could go on for if we are successful at drip-feeding this through the system. although of course, we cannot control its spread any better than anyone else once community transmission starts.

The longer the delay in this happening then the longer it will take us to come out the other end.

Panicked Fed Slashes Rates to Near 0%, Throws $700 Billion QE on Top, after $1.5 Trillion Shock-and-Awe Repos Fizzled. Stock Futures Plunge 5%, Hit Limit Down

Those traders that saw the '87 Crash up close always swore that "if that ever happens again, I'll be in like Flynn, buying at the bottom!" When 2009 arrived and the chance presented itself - guess what? Most of them didn't! It's never easy to spot a bottom during a panic. So today we have those same traders who 'missed out' in 2008 getting another opportunity to buy, and so they were, on Friday. But this time, it is likely to be a bigger mistake than not buying last time. We'll know sometime soon.

I'd rather buy a year after the bottom than a month before...

WOW what a shock announcement! Is it a further steroid shot for property?

"...the outlook for the economy had deteriorated significantly as a result of the impacts of COVID-19…

Not true, the economy has deteriorated significantly as a result of the REACTION to Covid19

Yvil I don't think you realize just how server this virus could be, they can mutate to a more sever strain over time. Hence the need for the PREVENTATIVE REACTION! It's good that process have been put in place to try to slow infection rates. Here go watch this short documentary on just how devastating a flu virus can be. Link: 1918 Spanish Flu historical documentary | Swine Flu Pandemic | Deadly plague

Speaking of reaction your adaptive reaction time is as fast as the Dinosaurs Yvil. You cannot even see the mess we are in now let alone try and visualize where this is heading.