A Labour win for landlords to celebrate
Wednesday 19 November 2014
It's not often property investors celebrate a Labour victory, but this time they can.
By Philip Macalister
Former trade union boss Andrew Little was, yesterday, elected leader of the Labour Party. While that may mean little on the face of it it is good news for property investors.
During Labour's leadership campaign where the four contenders pitched their wares to party members Little made it clear he would ditch the party's proposed capital gains tax policy.
The policy is still to be formally ditched but a sign it will happen is that fellow leadership contender, and former finance spokesman David Parker announced yesterday that he would not continue on in this role.
As the architect of the policy, his decision can be seen as a good sign that this policy, along with one to raise the age of eligibility for NZ Superannuation, will go.
While it is a long time until the next general election, and the prospects of Labour winning that battle may seem a long-shot today, investors can breathe a sigh of relief.
Short term factors which are more likely to impact the housing market are continued reductions in home loan rates and, one suspects, the recent valuations released in Auckland City. The majority of people owning property in the City of Sails now will have quite a bit more equity than they did before. Whether investors decide to use this capital to increase the size of their portfolios, and if they chose to buy more Auckland property or look to surrounding provincial areas will be something to watch
One clue that this may happen can be seen in Rotorua. The Professional real estate office is reporting a pick up in sales to Auckland landlords and says it has more out-of-town buyers.
While there are signs that the real estate market may get a new head of steam the Reserve Bank has made its position clear. Governor Graeme Wheeler said, when releasing the Financial Stability Report, that the bank would like to see house prince inflation move in line with income growth.
Comments from our readers
No comments yet
Sign In / Register to add your comment
The number of sales nationwide was up by 15.5% year-on-year to reach the highest level in five months in October, according to the latest REINZ data.
The Capital City’s property values have been on the rise again in recent months – even though they have already increased by 45% in the last three years.
Interested in testing the commercial property waters? Property Managers Group (PMG) has just put its largest retail offer in its diversified, unlisted commercial property fund on to the market.
Mortgage lending to property investors fell to $1.01 billion last month amid ongoing tightening on interest-only credit, the latest Reserve Bank data shows.