Landlords are not responsible for Auckland's homeless, says a sector chief who fears new Reserve Bank moves could reduce rental supply and escalate rents.
Andrew King, Property Investors Federation executive officer, said his organisation said landlords were being blamed for serious social issues.
Prime Minister John Key says he "potentially" supports income-related restrictions on mortgage lending. Key said increasing supply was still the main issue to dampen the "overheated" Auckland property market, but the Reserve Bank had some options to address the demand side.
King is worried.
"The plight of these [homeless] people demonstrate that we need more rental properties so that they have somewhere to live. We need more properties all over, for tenants as well as owner-occupiers. And the fact we're seeing people living in cars, garages and overcrowded conditions, they need more homes.
Rental property owners provide those homes," King said.
Reserve Bank governor Graeme Wheeler last week dropped strong hints that further loan-to-value ratio restrictions for investors were on the cards.
Debt-to-income lending rules would also be discussed with Finance Minister Bill English in the next few weeks.
The plight of these [homeless] people demonstrate that we need more rental properties so that they have somewhere to live. We need more properties all over, for tenants as well as owner-occupiers.
The Reserve Bank's statement on Thursday spelled out the issues.
"House price inflation in Auckland and other regions is adding to financial stability concerns. Auckland house prices in particular are at very high levels, and additional housing supply is needed," the statement said.
King said further crackdowns could diminish rental supply and capital gains tax is another concern for him.
"People need to realise that if you stop investors providing rental homes, you're hurting those people who can't afford to buy their own places. People are saying we need to go after investors. They're saying 'if we can stop them getting into property, there will be less competition for first home buyers'," King said, citing letters to the editor and media comments.
"But in fact if rental property supply diminishes, then rents go up due to a scarcity which makes it harder for people to save for a deposit and buy their own home."
King fears landlords are being blamed for wider issues.
"Everyone is saying, 'let's just pile it all on the investors'. That would mean far fewer rental property owners and a lower supply of properties for tenants."
CoreLogic has reported that 46 per cent of property sales in Auckland over the last month were to investors and Phil Twyford, Labour's housing spokesman, said 80 per cent of recent Otara sales were to landlords.
King was unsurprised by the Otara figure which he thought could be correct.
"In areas where's there's a lot of tenants, you tend to get a lot of investor activity because the demand is there. It is a poor area but that's the reason you're not seeing people buy their own homes. It's always been that way," King said.