OCR: Households and businesses still held hostage to housing crisis

The National Government’s failure to fix the Auckland housing crisis continues to keep interest rates higher than they need to be, meaning families and businesses face higher than necessary costs of borrowing, the Green Party said today.

The Reserve Bank today left the Official Cash Rate unchanged at 2.25 percent despite economic conditions that favour lowering the rate, citing risks to the economy from high house prices and a lack of housing supply.

“National’s failure to fix the Auckland housing crisis is forcing the Reserve Bank to keep interest rates higher, hurting families, exporters, and jobs,” Green Party Co-leader James Shaw said.

“If National had tackled the Auckland housing crisis instead of choosing to do as little as possible, households and small businesses could be benefitting from lower interest rates right now.

“Higher than necessary interest rates are pushing the New Zealand dollar up, which hurts our exporters.

“We know what’s needed to start rebalancing the economy and fixing the Auckland housing crisis. National knows too, but is choosing not to act.

“Our country needs a capital gains tax (excluding the family home) to help rebalance investment and dampen property speculation, restrictions on overseas buyers to help slow demand, and a substantial government-led house building programme so all New Zealanders can afford a warm, dry home,” said Mr Shaw.

Latest Finance Announcements

Story

Economic windfall should be funnelled straight back into communities: Green Party

Following an economic forecast that shows Aotearoa strongly rebounding from COVID-19, and Crown accounts looking much healthier than expected, the ...
Read More

Story

Green Party to abstain from tax changes that will worsen house crisis in absence of tax on assets

The Green Party will abstain from a bill that will make slight changes to income tax brackets.
Read More

Story

Green Party welcome Adrian Orr’s full and frank advice on tax

We welcome Adrian Orr signalling that he will provide advice to the Finance Minister on fiscal measures, include tax changes, to cool the housing m...
Read More

Story

Green Party respond to Government review of housing settings

It is a positive step that the Government is looking at options to take the heat out of the housing market, and has written to the Reserve Bank to ...
Read More

Story

Reserve Bank policies will inevitably heat housing market, Government must implement tax reform to cool it down

The Government must use levers to prevent further over-heating of the housing market, which will result from the Reserve Bank pumping another $28 b...
Read More

Story

No surprise in National’s latest attempt to slash public services

National’s ‘alternative budget’ that includes huge cuts to the government’s operating allowance would risk gutting critical public services, and pu...
Read More