PHOTO: Cameron Bagrie on The AM Show. Credits:The AM Show
With interest rates probably unable to go any lower and hikes possibly on the horizon, a prominent economist is warning property owners they might soon actually have to “do stuff” to make a living.
The rapid rise in property values in recent years has been at least partially attributed to low interest rates, with the cost of borrowing lower than ever. Last year, despite the Government having to spend billions to keep people in work as the COVID-19 pandemic hit, residential properties increased in value by double-digit percentages.
The Reserve Bank has kept the official cash rate (OCR) at a record-low 0.25 percent, its primary goal being to keep inflation under control. Some economists have called on the Government to step in, Shamubeel Eaqub for example saying it was enabling a “huge ponzi scheme” in the housing market that was “ripping apart the social fabric of New Zealand”.
READ MORE VIA NEWSHUB