Hater’s gonna hate, hate, hate, Bank’s gonna speculate, speculate, speculate

By
Martyn Bradbury
-
12
4

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Investors head first-home buyers
New Zealand banks approved three times as many mortgages for investors as they did for first home-buyers over the past year, Reserve Bank figures show.

Since August last year, when the dataset began, the share of total lending which went to first-home buyers has remained the same, at around 10 per cent.

The proportion of lending to investors has risen over that time, from 29 percent to 33 per cent.

The role of our greedy banks is often ignored in the debate over Auckland’s property bubble. We’ll point the finger at foreign speculators and curse greedy baby boomers, but the real anger should be focused on the ‘cooks’ of this money.

Lending three times as much money to speculators than first time home buyers is the final proof – if such evidence was needed – that NZ is a speculators paradise.

Our unchallenged free market ideology allows for our sovereignty to be speculated away from under us and the Bank’s are milking it.

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12 COMMENTS

  1. The Reserve Bank also says that in the first half of 2015 of 41,013 mortgages lent out by New Zealand Banks 9,890 were to first Home buyers and 31,123 were to Investors,

    Now i assumed yesterday when i commented on this in ‘Open Mic’ that such data was for the whole of New Zealand, we all know what they say about assumptions right???,

    RadioNZ yesterday afternoon says the 6 months of data released by the Reserve Bank was for mortgages within the Auckland City boundaries, i probably need to OIA the Reserve Bank to ascertain whether this is in fact true, AND, to ask the pertinent query of the Reserve Bank, ”How many of the mortgages to Investors were ‘Interest Only Loans’,

    It is the ‘Tool’ of interest only loans that sees Ma and Pa looking to purchase their first home being locked out of’ the market’ by what to all intents and purposes are Speculators who disadvatage the Ma and Pa buyers by being able to pay only the interest on the mortgage while Ma and Pa pay both the interest and the principle on their’s,

    SO, China based investors responsible for the over-inflation of property prices in New Zealand, there might be some in the mix somewhere, BUT, in the middle we have our fellow New Zealander’s clipping the ticket on the free money train snapping up property to the tune of 31,123 houses in 6 months,

    There are 2 Tools that our fellow citizens are using en masse to speculate first home buyers out of ‘the market’, the already mentioned Interest Only Loans, and, the second being the loose Tax Rules which allow all these Speculators to write off any loss from such ‘investment’ against any other tax, including income tax, that they will be liable to pay, meanwhile Ma and Pa looking for that first Home have no such advantage,

    There is a legitimate reason for Banks to offer Interest Only Loans, should a property owner wish to relocate for instance, they will buy their new home using an Interest Only Loan while they sell their existing Home which allows them to do so without paying 2 mortgages,

    Such Interest Only Loans, until 15-20 years ago, were usually for a period of six months, now, some of the Banks are offering such loans for periods of ten years, a speculators paradise, a pimper’s paradise,

    The Reserve Bank, which makes the Rules for all Banks trading in New Zealand has simply sat on its hands blithely ignorant as the trading Banks have extended the terms of these interest Only Loans from 6 months to 10 years and could tomorrow bring the whole speculation circus to a grinding halt by imposing a rule that such loans be for a 6 month period only,

    This Pimper’s Paradise, a world of free money for Speculators has a face, here’s what ex-Labour Party President Mike Williams had to say on RadioNZ National on Monday morning,

    ”Mathew,(Hooton),and I have both taken advantage of rising Auckland house prices in the last 3 months”, unquote,

    There’s a world of Privilege and Political Machinations involved in that one small sentence uttered by Williams who i happily accuse of being a hypocrite who while Speculating in that very same Auckland property market has extolled Labour’s Phil Twyford’s pointing of the finger at those with Chinese sounding names as the culprits,

    For the New Zealand Trading Banks to flood our country with what is essentially the results of US quantitative easing there need be a whole class of Pimps willing to speculate, and unfortunately, the Pimps in our society come from across the political spectrum….

    • “The “wall of Chinese capital” hitting property markets in Sydney and Melbourne will not ease up until the government introduces its anti-money laundering legislation, says an expert in ‘flight capital’….

      The $US50,000 limit on exchanging Chinese currency into $US and $A was being breached in the majority of Chinese property deals in Melbourne and Sydney, and once the AML laws were introduced, the “wall of capital” from China would dry up.

      Read more: http://www.smh.com.au/business/comment-and-analysis/wall-of-chinese-capital-buying-up-australian-properties-20150628-ghztdf.html#ixzz3hFO1I1gK

      ( the same legislation is required in New Zealand)

      • It’s ‘colonising money’, not ‘flight capital”.

        Let’s face it, China will colonise the Sydney, Melbourne, Auckland and Toronto et. al. with less bloodshed through financing houses, than financing a war.

    • I agree with you Bad13 the speculators are what is distorting the house prices. I think that there is probably a lot of dairy money that has flowed into the Auckland market when the milk price was high. The next wave of speculators will not be borrowing money in NZ but they will be speculators none the less! Labour were silly to rely on the Chinese name thing when they do have data from the RB to make a similar much more sustainable claim!

  3. Yeah but…in the last few days of the NZ Herald we had a n article about the Headhunters gang.

    Now back in the days of Chiang Kai Chek…he was supported by western powers against Mao Se Tung. Chiang Kai Chek lost…and so did the west.

    Chiang Kai Chek was a thug …and a criminal.

    And he fitted the profile of other gangs like the Mafia which flourish under right wing govt.

    Most of these gangs do well under the neo liberal economic system….it lends itself to it due to deregulation. Then out comes the social whitewashing that comes with seeking a more respectable social image.

    It’s all been done before.

    The Triads and Yakooza are masters at it.

    Now the point is this:

    If you have a few million spare kicking around – the banks don’t give a rats so long as the law isn’t chasing you…if you’ve laundered that cash and have a few trusts to legitimize it….hey !…you’re an investor ready to go !!!

    They don’t care where you got that cash so long as they make a profit on the interest.

    So it is a small- very small – leap from dealing with legitimate concerns and dealing with the criminal element.

    And so – as we’ve seen – the Chinese govt wanted the power of extradition because in their own words – so many of those who’ve made their millions and are living in NZ gained that wealth through criminal means…

    Now the point of all this is to demonstrate the caliber of people who manage these banks.

    They are the ‘ enablers’ for all sorts of skulduggery.

    They are…in many cases…a swept up version of the gang member that seeks to soften their social ‘ image’ …to further enable keeping under the radar and becoming socially acceptable.

    How many Swiss accounts hide all manner of skulduggery with no questions asked – and even new laws passed to prevent this a few years back still doesn’t stop this dodgy trading.

    And so in light of all this…is it any wonder at all that so many of the banks are complicit in encouraging a short term opportunistic cash cow with out the slightest concern whatsoever for its consequences?

    And in particular contributing to the malaise of the Auckland housing market in favoring overseas speculators over and above NZ citizens?

    They don’t give a shit about borders/national sovereignty so long as they make their cash.

    Never have and never will.

  5. Banks probably are now so addicted to reaping the massive profits from borrowing to overleveraged buyers both investors and first timers’.

    When they have the next melt down coming they will squeal to Government to bail them out yet again.

    Until this speculator game is stopped from a Government who is lead by the master speculator of all we will be building to a massive correction the country has never seen before.

  6. Quite right, Cleany. Where are the building societies, the mutual banks? I’d be open to bailing them out (maybe even Kiwibank), but the Big Ones can go suck a lemon.

  7. Okay, I give up Martyn. 😀
    Finally tied up all the arms of the octopus, Dr John Coleman identified its head.
    Sent it to Labour and Maori Party.

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