Moves to crackdown on property speculators have been welcomed as a step in the right direction by market commentators but one analyst says the changes may be too little too late.
The raft of new measures announced on Sunday will include tax being applied to capital gains on property sold within two years of purchase, provided it is not the seller's primary residence, an inheritance or a sale for a matrimonial settlement.
Craigs Investment Partners head of private wealth research Mark Lister said the rules would have marginal impact on housing market inflation.
"It's too little too late in some ways," Lister said. "We've seen the market rise strongly over the last several years so it would have been nice to have seen something like this come out a bit earlier in the piece. But from here it's a good thing to try and isolate those people who are speculating on property and driving prices up."
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He said any measures that encouraged people to diversify their investments away from property were a positive development for the capital markets.
"Hopefully it will cause a few people who are trying to hop on the bandwagon, just to get some big profits, to change their mindset, but I don't think it will change those fundamental drivers of why Auckland property prices are going up," Lister said. "It's just that more people are moving [to Auckland] and there's only so many places for them to live."
Rickey Ward, New Zealand equity manager at JBWere, said the Government's slow progress on overhauling the Resource Management Act (RMA), which would speed up development and new housing supply in Auckland, was a big part of the problem.
"It does feel like [the new rules] are stalling for time to allow them to address the real problem which is the inability to get new infrastructure and get the RMA resolved," he said.
Ward was sceptical about how much impact the new measures would have on cooling the housing market.
"You really do question whether it's going to succeed. Chances are it won't," he said. "But you have to try something new and it will provide a bit of time to resolve the real issues."
Harbour Asset Management analyst Shane Solly said a consistent land development strategy, combined with infrastructure investments, would be crucial in providing a long-term solution to housing market issues.