Did everyone catch the NZ Reserve Bank announcement today that investors with five or more rental properties will be required to be treated commercially by banks?
Apparently we must be treated as small business owners in risk profile, and higher costs for credit paid. Higher interest rates and potentially lower LVR ratios are possible. This will reduce liquidity in the market more, on top of the 20% deposit rules already applied late last year. There is some speculation that it will be applied on a 5-property rule per bank, which would soften the impact for some.
This is rough stuff for property investors and will arguably tighten housing supply discouraging bigger investors to participate in construction of larger scale portfolios. It must further spook the market in the short run. But it will likely create some good buying opportunities on the flip side.
Salesh is the best CA I have ever met in New Zealand so far. Period! The reason that I had fired my previous accountants is that they are so cheap. And they offer cheap advice. You need good and solid advice that can make you more money in the long run. And Salesh is the man who can deliver real results for you. Cheers to your success, Kind Regards - George Guo - ANZ BANK Senior Personal Banker
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