Reserve Bank Governor Graeme Wheeler. Photo / Mark Mitchell
Reserve Bank Governor Graeme Wheeler. Photo / Mark Mitchell
Opinion by Liam Dann
Liam Dann, Business Editor at Large for New Zealand’s Herald, works as a writer, columnist, radio commentator and as a presenter and producer of videos and podcasts.
The Reserve Bank has made the right call to toughen property lending restrictions.
The new rules are no silver bullet. In fact they are a blunt and unwieldy weapon.
They won't be popular.
Some first-home buyers will suffer. Investors will say restrictions limit rental supply. Others argue they'll make iteasier for cashed-up buyers to cherry pick.
These are valid criticisms of a policy that nobody claims is perfect.
"As a result the risk to a future correction of house prices has increased," the bank says. As tough as it may seem, its job is to remain focused on the collective risk - regardless of any collateral damage it may cause.
The central bank says these are temporary measures.
The path to seeing them removed is in the hands of the politicians and councils as they struggle to get more houses built.