RESERVE BANK MAKES A FOOL OF ITSELF
“A Dafter Touch?”
Were we too kind to Reserve Bank Governor Alan Bollard in our April 06 comment (scroll back) when we generously suggested he may have a defter touch with the markets than his predecessor Dr Brash?
Bollard's bizarre utterances from the OECD conference this week predicting house prices will begin to fall by the end of the year has blown his cover completely – ho hum – we've heard it all before.
If you want to read the most incisive, succinct reply from our Real Estate Institute ever go to www.reinz.co.nz (Latest news/ Residential Market News/ Reserve Bank interference on house prices).
And then an OECD report came out stating New Zealand was the second most likely country in the western world to be facing a major property crash. Hello?
Dr Bollard must have paid for lunch.
To quote our REINZ President Howard Morley briefly: “There seems to be a popular belief that reducing house prices, as a way of putting New Zealanders off property investment, is some sort of desirable economic goal when in fact what it will do is reduce the carefully accumulated savings of most New Zealanders.
The Bank would do better off to address the lack of safe savings options for New Zealanders outside of residential property.
At this stage the only factor I can see causing house prices to fall is Dr Bollard.”
If I can repeat for our loyal, if often stunned offshore clients, Dr Bollard is not a North Korean Agent nor a fraudster trying to collapse and take advantage of our markets – he is the Governor of our Reserve Bank.
No, we don't shoot people for treason in New Zealand because it is no longer in our politically correct dictionaries.
Anyway, as for reality, things have never been better.
Most New Zealanders have realised they must make provision for their own superannuation and they won't lose their money in property.
Our fortnightly street auctions are drawing up to 100 buyers and the action is hot.
Rentals are in strong demand and we NEED suites to rent.
Look on the bright side – you won't have to bid against Dr Bollard for your share.
Enjoy the last of this beautiful soft winter.
MARTIN
