“Adrian Orr’s announcement that the OCR remains stable offers little relief to first home buyers. New Zealand has the fifth highest mortgage rates in the OECD and the average first home buyer in Auckland repricing a 2-year fixed rate is facing repayment increases of $490 per week,” says ACT Party Leader David Seymour.
“While the rest of the world recovers from the shock of COVID, Labour’s incompetence is still laying waste to New Zealand’s economy. High inflation, fuelled by persistent non-tradeable (domestic) inflation is keeping the OCR, and thus mortgage rates, high. New Zealand’s mortgage rates were the fifth highest in the OECD for the July quarter, trumped only by Columbia, Hungary, Poland and Chile.
“Half of all mortgages are due for repricing this year, and this mortgage crunch will affect no-one more than first home buyers. They are in the perfect storm of having purchased in a high price, low interest environment, repricing into the highest mortgage rates since the GFC. An average first home buyer nationwide faces repayment increases of $360 per week. In the higher cost Auckland market, this is closer to $500 per week. With costs soaring across the board, this cannot end well.
“Only ACT has a plan to unleash New Zealand’s economy by slashing inflationary Government spending, taming the jungle of red tape and letting Kiwis keep more of the money they make. New Zealand’s once-thriving economy has become sluggish under Labour. Fortunately, ACT is waiting in the wings to turn things around.”