Govt’s housing failure hurting the rest of the economy

The Government’s failure to fix Auckland’s broken housing market has forced the Reserve Bank to keep the Official Cash Rate (OCR) higher than normal hurting exporters and jobs, the Green Party said today.

The Reserve Bank kept the OCR unchanged today at 2.25 percent despite economic conditions that favour further cuts. The Bank cited high Auckland house prices and a need for additional housing supply there. “Housing market pressures are building in some other regions,” it added.

“National’s failure to fix the Auckland housing market is forcing the Reserve Bank to keep interest rates higher, hurting ordinary families, exporters, and jobs,” Green Party finance spokesperson Julie Anne Genter said.

“The Bank clearly blamed runaway Auckland house prices and the lack of adequate housing supply as one of the key reasons for its decision to keep the OCR unchanged today.

“National needs to introduce strong measures that will contain house price inflation in Auckland instead of leaving it all up to the Reserve Bank to manage with one tool — interest rates.

“Higher interest rates are keeping the New Zealand dollar higher, suppressing exports and contributing to the largest annual trade deficit since April 2009.

“New Zealand households and businesses will benefit from interest rate cuts, but lower rates will mean higher risks of house prices inflating further.

“The responsible policy from Government would be a comprehensive capital gains tax (excluding the family home) to remove the unfair tax incentive to invest in property. A ban of foreign buyers would also help reduce excess demand for Auckland houses.

“If the Government is serious about dealing with Auckland supply constraints, it should be building more homes, especially affordable homes to help first home buyers rather than property investors.

“By addressing the Auckland housing affordability crisis, the Government can safely reduce the cost of borrowing to help businesses and all those with mortgages or looking to get into their first home,” Ms Genter said.

Action

Join our call to stop funding fossil fuels!

Take Action

Action

Virtual Events

We have activists across Aotearoa / New Zealand who are working hard to build a brighter future for our kids and grandkids. This page lists upcomin...
Take Action

Action

Support our Climate Action Plan for bigger bolder climate action

We agree with all five of the School Strike for Climate's demands. Read more and sign the petition.
Take Action

Action

Show your support to end housing inequality

New Zealand’s housing market is becoming increasingly divided between people who own their own homes and those forced to rent for life...
Take Action

Latest Finance Announcements

Story

Green Budget win backs public sector leadership on climate change

The Greens in Government have today won a significant investment to help move the public sector estate onto clean, renewable energy, Green Party Co...
Read More

Story

Budget 2019 Speech - James Shaw

E te Māngai o te Whare, tēnā koe. Ki a koutou ōku hoa Pāremata, huri noa i te Whare, ngā mihi o te tau hou ki a koutou katoa. 1.         The Wellbe...
Read More

Story

Green Party welcomes first Wellbeing Budget

“The Green Party is proud to welcome New Zealand’s first Wellbeing Budget to deliver change for New Zealanders,” Green Party Co-leader James Shaw s...
Read More

Story

Wellbeing: We need to change how we see our economy

“The Wellbeing Budget is a first step in changing the way we look at the economy and our place in it”, said Green Party Co-leader Marama Davidson. ...
Read More

Story

New Zealand needs a Fairer Tax System

“We’ll continue to work with Labour to make our tax system fairer,” Green Party Co-leader James Shaw said today following the Government response t...
Read More

Story

Green Party welcome Tax Working Group report

The Green Party welcomes the Tax Working Group report, which lays out a plan to ensure taxation in Aotearoa is fair and enhances the wellbeing of a...
Read More