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Homes used to cost a lot less, but in previous decades home loan interest rates were much higher.
Record low interest rates are great for homeowners – but not so good for anyone hoping to earn interest on money in the bank. Over recent years, anyone with money in a savings account or term deposit has seen their returns drop to virtually nothing. Term deposits are now paying up to 1 per cent a year for terms of five years, compared to a 10-year average of 4.39 per cent. Virtually all the return would be swallowed by inflation. Short-term deposits of 90 days are paying just 0.35 per cent compared to a 10-year average of 2.9 per cent.
15th Dec 20, 11:47am
By Gareth Vaughan
The Reserve Bank (RBNZ) has once again raised the old chestnut of having a tool to restrict high debt-to-income ratio mortgage lending included in its macro-prudential toolkit.
The latest request of the Government, whose acquiescence is required, comes in
the RBNZ s response to Finance Minister Grant Robertson, released on Friday, over his concerns about soaring house prices. We have also previously consulted on introducing debt serviceability restrictions, such as debt-to-income (DTI) limits, on mortgage lending. Although we consider that restrictions on high-DTI lending could complement the current LVR [loan-to-value ratio] policy, we note that this tool is not currently part of the Reserve Bank’s Memorandum of Understanding with the Minister of Finance. We request that the Government gives consideration to adding restrictions on debt serviceability (that would include DTI limits) to the permitted tools in 2021, the RBNZ said.
Nor have the similarly large Buddle Findlay, Minter Ellison Rudd Watts or Simpson Grierson. Only three law firms have signed the pledge to pay staff and contractors a living wage: Anderson Lloyd, Darroch Forrest, and Presland & Co Solicitors. New Zealand Law Society (Wellington) Vice President Arti Chand said junior lawyers needed to be supported. Not just in terms of their salary, but to achieve a better work-life balance. “We meet regularly with the Aotearoa Legal Workers Union on a number of matters, including remuneration, and look forward to discussing further the points they have raised in their open letter in the new year.