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http://www.3news.co.nz/Reserve-B ... 315736/Default.aspx
The Reserve Bank governor's given his starkest warning yet that rampant house price inflation in Auckland and Christchurch must end, and soon.
Graeme Wheeler says otherwise floating mortgage rates could rise to 8 percent, or even higher. That would add hundreds of dollars a month to the cost of servicing a typical mortgage.
Rock-bottom interest rates have helped drive up house prices. But Mr Wheeler today predicted an end to the run of low rates, defending his bank's restrictions on low-deposit loans.
He says inflation could drive interest rates as high as 8 percent by 2016.
For a homeowner with a $300,000 mortgage on the current low rate around 5 percent, that could mean an extra $530 in monthly repayments. |
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