Low rates boost NZ’s housing affordability
According to the report, on average, New Zealand households taking out a 70% loan-to-value ratio (LVR) mortgage needed 29.7% of their income to meet monthly mortgage repayments in June 2019.
That’s as compared with 30.5% in June 2018, largely as a result of declining interest rates.
At the same time, median house prices in New Zealand increased by 4.5% in that time, which was a lower rate than the prior year, and therefore weighed less on affordability.
Further, mortgage interest rates declined by an average 0.44 percentage points while salaries increased by 2.8% in the year to March 2019.
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