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Nelson Families Face Mortgage Increases Of $160 A Week, MP Says

Contributor:
Fuseworks Media
Fuseworks Media

Wellington, May 28 NZPA - Mortgage rate rises are costing families in Nelson an extra $50 million a year, Parliament was told today.

National's Nick Smith, MP for Nelson, said there were 5712 families with mortgages in his electorate and because of interest rate rises they were facing average increases of $160 a week.

Speaking during the budget debate, Dr Smith told Labour MPs: "Your `big government' policies have increased interest rates every year you've been in government.

"When you came to government, interest rates were 6.7 percent, they are now 10.4 percent."

Dr Smith said he did not think Labour MPs understood the sort of stress that was being felt by families who aspired to own their own homes.

He said the Government's answer to the cost of housing was its home equity scheme, which it had said would make a huge difference to struggling families.

"This policy involves 700 home equity loans, allocated on a population basis between Auckland, Wellington, Christchurch, Nelson and Queenstown," he said.

"That means my electorate of Nelson will get 20 loans over two years -- 10 loans a year."

Dr Smith said that under the scheme an interest-free loan was provided for 10 percent of the value of a house.

Houses had to cost less than $240,000, and there were very few available at that figure in Nelson.

"So it's an interest-free loan for 10 people a year of $24,000. That means help of $40 a week for 10 families in Nelson this year and next year," he said.

"This budget is dishonest when it says $40,000 for the people of Nelson to help with housing costs when they're facing increased mortgage costs of $50 million a year."

NZPA PAR pw dj

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