Tightened LVRs another blow for first-time homebuyers
The revised restrictions on the Reserve Bank’s loan-to-value ratio have made it even more difficult for first-time homebuyers to access the property ladder, said Andrew Bayly, National shadow treasurer.
“LVRs are meant to be a tool that reduces risks to financial stability – not to change house prices at the expense of first-time homebuyers.
“The underlying problem behind LVRs is currently that the Minister of Finance is influencing the Reserve Bank to give more weight to house prices than it should, when the real solution to the house price problem is housing is to remove barriers to increasing housing supply.
“The Prime Minister has promised to ’tilt the rules of the game’ in favor of first-time homebuyers. But QV’s most recent figures showing house prices at the lower end of the market have risen at a faster rate this winter than they have in five years suggest the government is doing the exact opposite.
“The minister asked the Reserve Bank to take into account the government’s policy to support more sustainable house prices, while the Bank has previously argued that lenders are well positioned to resist a price correction in housing.
“What is clear is that the Reserve Bank responds to the directives of the Minister of Finance.
“But what is not clear is why tighter LVR restrictions are needed, or whether the benefits will outweigh the impact they will have on first-time homebuyers, quickly losing even one. glimmer of hope to climb the property ladder.
“Instead of interfering with the Reserve Bank, the government should focus on facilitating the construction.”
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