Post by Crash Post by JohnO
Yes - wishful thinking from our political leaders continues - Ardern
joins the list of PMs of both major parties that has never had a plan
to bring down house prices.
What kind of a plan could there be that would not compromise the eocnomy even further than it is now?
Post by Crash
The reason is that bringing house prices back to affordable levels
requires a reduction as substantial as the increases over the last 20
years or so, but the drop needs to be faster. For those who bought
their first home most recently (in particular) this means the value of
their house will drop the most and potentially it will fall below the
value of the mortgage balance owing. Couple that with increasing
interest rates, that risks financial instability with mortgagee sales
for those mortgagors who cannot cope with increased mortgage payments
on a home whose value has dropped.
So who is going to be the PM that risks all this?
The ulitmate poisoned chalice?
In New Zealand it's an irreversible greed-and-fear-driven one-way upward ratcheting of property prices that favours the already-ahead wealth-extraction fraternity whose behaviour also contributes least to the nation's real productivity. As wealth-extractors they are, effectively, sucking the lifeblood out of the economy, fully aided and financed by the profit-exporting foreign-owned banks as they take their cut. This is the organsised, systematic hollowing out of the economy and those who must live within its provisions and the damage the wealth-extractors are creating with a vengeance. The road to economic penury and perdition.
For irreversible read 'inevitable doomsday'.
Those in this country least at risk are mostly those seniors owing and living in their single, manageable, 100% unencumbered, up-to-date, freehold property plus sufficient liquid assets to see them through the immediate crisis, with plenty also in hand to fund them during the long and hard aftermath and recovery.
 Cash or other liquidable assets negotiable on sight.