New Zealand Labour Party

Reserve Bank pleas for action from Government

The Reserve Bank has stopped asking and is now pleading with the Government to take urgent action on the housing crisis, says Labour’s Finance spokesperson Grant Robertson.

“Deputy Governor Grant Spencer is clearly deeply concerned about the housing crisis. The Bank needs help. His speech today says tackling housing demand is a ‘team effort’ but the Government is just sitting on the sidelines.

“It is extraordinary that the Reserve Bank has said, ‘housing risks require a broad policy response’. In the diplomatic wording of the Bank that is a shot across the bow to a Government that isn’t doing anything tangible.

“The Government has repeatedly said the Reserve Bank needs to tackle demand. Now the Bank is pushing back and saying National needs to play its part.

“There is a stark warning in this speech that the more the housing crisis goes on the more likely there will be a correction. That is the bubble bursting.

“Labour welcomes the Reserve Bank’s indication they will bring in broader investor LVRs by the end of the year but this is only a short term solution. We have seen that LVRs are only a temporary band aid – they don’t fix the problem long term.

“With house prices skyrocketing by the day the Government needs to take action on both supply and demand and take control of the situation.

“The alarm bells are ringing but the Government is deaf to them. National is all talk and no action.

“Labour has a plan to deal with all aspects of the housing crisis and restore the Kiwi Dream of home ownership,” says Grant Robertson.