'Unfair' to blame landlords for house price rises - investors

  • 06/07/2016

Property investors say it's unfair to blame them for rocketing house prices around New Zealand.

The latest Quotable Value figures show property prices rising at their fastest rate since 2004 in the past three months.

"It appears this may have led to a surge in investor purchases in various housing markets around the country over the past month," QV said on Tuesday.

That's prompted Prime Minister John Key to suggest the Reserve Bank (RBNZ) have a look at clamping down further on investors.

But Andrew King from the Property Investors' Federation says we actually need more rental properties.

"The Prime Minister's advice to further hinder the provision of rental properties in New Zealand is misguided," he says.

"People are living in cars and in overcrowded conditions because the rental properties just simply aren't there."

He says previous attempts to clamp down on property investors have only pushed up prices further.

Mr Key had said there was a responsibility for RBNZ to "have a look at the question around investors".

Asked if he was keen for RBNZ to consider extending loan-to-value ratios (LVRs) above the 30 percent limit in Auckland, Mr Key said: "My own view is [they] should make some movements in that area, yes".

RBNZ Deputy Governor Grant Spencer will give a speech on Thursday, and it is expected he could recommend further restrictions on investors.

In November last year the RBNZ restricted investor borrowing in Auckland to 70 percent of the value of the property they were buying. In the rest of the country the limit is 80 percent.

RBNZ could increase the restriction on property investors in Auckland, or across the country.

QV figures released on Tuesday show the average value of a New Zealand home increased 13.5 percent to $590,909 in June from a year earlier.

Newshub. / NZN