Mismanaged LVR process hurts first home buyers and regions

The Government has completely mismanaged the mortgage lending limits process and failed to consider the impacts on first home buyers or regions where house prices are stagnating, Labour Leader David Cunliffe says.

“Mortgage lending limits are going to lock thousands of first home-buyers out of the market. Alongside National’s failed housing policy, they will create a generation of renters. Labour believes all Kiwis should have a fair chance at the home ownership dream. That dream is disappearing under National.

“Lending limits are National’s failed attempt to solve the Auckland housing problem. But it is families in places like Marlborough, where prices are falling, that are being asked to fix it by saving more for a deposit.

“Why should a family in the regions have to stump up thousands of dollars more for a deposit to solve the housing problem in Auckland? That’s John Key’s job. If he really believes people in the regions think his policy is fair then he is completely out of touch.

“The paper trail shows the Government didn’t consider the impacts on first home buyers until a month after they had signed the LVR agreement with the Reserve Bank. It is also clear they didn’t consider the impacts on regions.

“Labour will make it clear to the Reserve Bank it must exempt first home buyers when using LVRs and consider targeting those regions where house price inflation is high.

“We will also fix the twin drivers of skyrocketing house prices — rampant property speculation and the shortage of affordable homes. We will clamp down on speculators through a capital gains tax and build 100,000 affordable first homes through KiwiBuild.

“National is a Government that backs Auckland speculators. Labour is the party of first home buyers across the country,” David Cunliffe says.

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