The New Zealand government announces new measures to curb house prices

  • NZ housing agency can borrow NZ$2bnb for land purchases
  • NZ to boost housing supply, infrastructure with NZ$3.8bn fund
  • New Zealand extends horizon for tax on investment property sales
  • NZ to remove tax deductibility of loan interest for investors
  • NZ govt to allow more people to access first home grants
  • NZ extends the 'bright-line' tax horizon to 10 years from 5 (the bright line test is related to tax on certain transactions, this extension will serve to increase the tax take at the margin).

The government had instructed the Reserve Bank of New Zealand to take house prices into account when setting policy. These are separate measures announced here.

The NZD is down a few points. Not a lot in this to directly impact the FX rate. Its easy to string together a narrative to explain the few point drop and I'm sure we'll get plenty. The NZD drop is only a few points so far though.