RBNZ still thinking about ways to slow the housing market

As we all already know the house prices are increasing so quickly specially in Auckland and followed by Wellington and other cities. Regular people can not afford to get on the property ladder. Most of the houses are bought by the property investors which drive the house prices up so rapidly. I think it would make sense for banks to lend to investors at a higher interest rate. For example, 1.5-2% higher than residential (people who buy house to live in). This would help first time buyers to get on the property ladder as some of the recovered mortgage interest can from investor rates can be used to help. Secondly, it would help to stabilise the housing market to a more manageable/reasonable situation so house prices do not go through the roof so fast. Thirdly, banks do not need to borrow so much from overseas, less pressure for banks, government, and individuals for long term. Government can also bring a tax/stamp duty for property investors and money raised from these can be used to build more affordable houses in places where there is a high demand.

regulators prefer to do it their way - the academic way - rather than to listen to effective and proven methods.

The sooner Keys and co and the reserve Bank accepted that unlimited foreign money (no NZ banks in sight) is what has caused the problem, the sooner they might come up with a real solution that helps Kiwis. The Canadian and Australian governments are only too painfully aware of the destructive force of the yuan. Anyone who believes the governments feeble attempt to roll out the 'Chinese buyers only represent 3 or 4% is seriously deluded. Spend a week at central city auctions and you will see who's money is pushing up Auckland prices.

We should invoke a quid pro quo policy - foreigners can only buy property in New Zealand if we can buy property in their country. That would wipe out Chinese investment for starters. Another option would be significant non resident withholding tax on sale of property. Those who are non resident would be discouraged from purchasing here.