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When do you think the LVR will reach its tightest?

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  • When do you think the LVR will reach its tightest?

    Hey guys, I was at a talk recently and I believe a bloke from ANZ said it would keep getting tighter until it goes debt to income. Do you guys see this happening? Any of the wiser gents seen this in previous property cycles?

    Cheers,
    -Chris

  • #2
    We are in uncharted territory history will teach us nothing of the current global fiasco. In the 80's for example banks were hardly even lending and you had to go to Marac or other finance companies, and pay 18 to 25% interest!

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    • #3
      What do your 'connections' say about this... Your claims in a different post to work smarter and have a proven system seem to be a little discredited with your contact with a 'bloke' from ANZ - no direct access to Mr Elliot? And your questioning of the people on this forum vs. working with your advisors.

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      • #4
        Well to be honest I just needed to do 10 posts to reply to private messages. I mean I believe all insight is valuable insight. So no harm in discussing is there?

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        • #5
          I've never seen interest rates this low here for one ... it depends on what the RB is trying to achieve ... it appears it will do whatever it takes to cool things down ... so it depends if things cool down and if interest rates remain low, in the right conditions who knows what the RB will do next ...

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          • #6
            QV claiming LVR restrictions working... However in their next breath they say Wellington (and other areas) are on fire... Interestingly the LVR restrictions where the most onerous OUTSIDE Auckland as Auckland only increased from 30% to 40% whilst balance of country went from NO restrictions to 40%!!

            from this POV there is no causal link between LVR restrictions and any slowdown... If there was the slowdown would be universal.

            something else at play?

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            • #7
              ANZ is showing all the signs of a bank in trouble. They are practically pleading with the Reserve Bank to implement changes that absolve them from making tough management decisions.

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              • #8
                I thought they made billions off you and I?

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                • #9
                  Originally posted by Don't believe the Hype View Post
                  QV claiming LVR restrictions working.. If there was the slowdown would be universal.

                  something else at play?
                  The displacement effect.?

                  Asian Cities lock out lower investors so they go offshore, locking out Ak investors so they borrow to stay local, Lvrs lock the lower investors out so they go off to smaller towns.?

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                  • #10
                    Originally posted by McDuck View Post
                    The displacement effect.?

                    Asian Cities lock out lower investors so they go offshore, locking out Ak investors so they borrow to stay local, Lvrs lock the lower investors out so they go off to smaller towns.?
                    if you're right then would you say the LVR restrictions are working or would you say they're doing exactly the opposite of their design intent by driving risk into locations outside Auckland?

                    When LVR went to 30% it put hamilton and tauranga at risk, moving to 40% drove risk into Wellington and beyond...

                    the unintended consequences of market intervention...

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                    • #11
                      It caused the areas around Queenstown to suddenly shoot up 30-40% in 12 months. 12 months!

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                      • #12
                        Originally posted by Don't believe the Hype View Post
                        if you're right then would you say the LVR restrict...
                        Well it depends on what you think the intention of the restrictions were.

                        The stated objective was to reduce bank risk.

                        So that's been slightly improved, at least in the direction they think the risk will come from.

                        The tenacity with which capital is chasing property is the endemic behavior that really needs to be confronted.

                        And as our old friend Ed de Bono informs us... you need a wall, a better target, or to not know the way.

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                        • #13
                          I am expecting the rules to be relaxed shortly given the current slow down. Knee jerk reaction followed by knee jerk reaction......

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                          • #14
                            Is the real problem caused by people from developing nations having all that call center and iPhone money, and not having local social structures they trust to look after them.
                            A sort of financial osmosis.

                            Actually, I'm starting to like this osmosis model for the money.

                            So Governments pipe in money to keep the economy growing, or at least ticking over.
                            The money is instantly sucked out of the goods economy and into property.
                            Rules are put in place to try and divert the money away from one area of property.
                            and as if by magic, that property seeking money is sucked into another location of property.
                            Blast! The Government thinks, let's pump in more money.
                            I wonder we're it will go...
                            Last edited by McDuck; 08-10-2016, 08:05 AM.

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