KEY POINTS:
Mortgage broker Mike Pero is warning of a wave of home sales after the third interest rate hike this year.
Mr Pero, the founder of a mortgage broker franchise network, says New Zealand is poised to become a nation of renters after the official cash rate, on which mortgages are based, rose yesterday to 8 per cent.
"Kiwis are finding it hard enough to get a foot on the property ladder, and these continued hikes are possibly going to leave some homeowners with no choice but to sell if they can't service the new mortgage rates."
Mr Pero said on one hand the Government was trying to promote saving through KiwiSaver, and on the other it was failing to offer tax cuts to mitigate the effect of higher interest rates.
He said renting might well continue to be the way for many Kiwis while an increasing number of off-shore investors bought "prime New Zealand land".
Mr Pero suggested that homeowners with mortgages should review their mortgage structure and look for good fixed rates to "weather the storm of these effects over the next few years".
- NZPA
