Changes to improve home ownership

Lower mortgage interest rates resulting from Labour’s monetary policy changes will help more New Zealanders into their own homes and make home ownership more affordable, says housing spokesman Phil Twyford.

“Just under 65 per cent  of all  Kiwi households own their own home these days, whereas 20 years ago that figure was closer to three-quarters, and part of the reason is that we pay higher interest rates than our major trading partners and comparable countries.

“Most people would be surprised to learn that in the US people are paying as low as 4.3% for a conventional mortgage, in the UK around 4.4% and in Australia around 5.1%, whereas our mortgage interest rates are nudging over 6% and heading for 8% according to the Reserve Bank and other commentators.

“We are paying an on-going premium because we are not paying our way in the world as a country, and haven’t done so for 40 years, instead we borrow from overseas and sell our businesses and land off-shore to make up the difference, pushing up our interest rates and our exchange rate.

“Our reserve bank upgrade will mean lower interest rates for individuals and business, and a more competitive exchange rate, which in combination will not only make home ownership more achievable after decades of decline, but also make home ownership more viable by lowering construction costs, and make home ownership more affordable for working families through lower monthly mortgage payments.

“Moreover, Labour has a serious plan to fix the housing crisis by building 100,000 affordable starter homes for people to buy, taxing speculators through a Capital Gains Tax excluding the family home, and putting a stop to offshore speculators buying homes here.

“Labour’s policies will begin the journey to bring home ownership back into reach for a generation of young Kiwis, the way it ought to be.”

—