OCR cut good for families, bad for Auckland housing

With unemployment rising and the economy going off on the wrong track, cutting the Official Cash Rate (OCR) was the right decision to help small and medium-sized businesses invest to create jobs and bring mortgage payments down for families, the Green Party says today.

The Reserve Bank Governor today announced a 0.25% cut to the OCR bringing the new rate to 2.5%.

“The National Government’s management of the economy has them desperately pulling levers and pushing buttons but they’re failing New Zealanders. The decision by the Reserve Bank to cut the OCR was the right thing to do,” said Green Party Co-leader Metiria Turei.

“New Zealanders are doing it tough with unemployment rising and the economy slowing down. The OCR cut will help small businesses invest to create jobs and decrease payments for people with mortgages.

“However, a cut to the OCR will pour fuel on the fire in the Auckland property market. But the OCR should not be the tool used to control the housing market in Auckland.

“The National Government needs to step up and take real action to cool the housing market in Auckland, otherwise it will continue to be hard for first-home buyers to get their foot in the door.

“The Green Party wants the Government to use the tools we’ve been talking about for a long time, like a capital gains tax (excluding the family home), smart intensification along key public transport routes, and a massive state-led home-building programme, to control the Auckland housing market,” said Mrs Turei.

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