The housing market and the Government’s response to it remains in a holding pattern while everyone waits to see if the Reserve Bank’s new lending restrictions have anything more than a temporary effect.

The bank’s first two rounds of Loan to Value Ratio Restrictions in November 2013 and November 2015 slowed the Auckland housing market for a matter of months each time, before it roared back to life in the following February-March sales seasons.

The jury is out on whether this third round of restrictions that applied formally from October 1 and have been in operation since mid-July will be anything more than a speed bump. Real Estate Institute figures on sales volumes and prices for September certainly confirmed a slight cooling of activity through August and September in Auckland, although the ‘Halo Effect’ is still burning brightly in cities further afield, particularly beyond Hamilton and Tauranga. These Auckland satellite cities have also seen a slight cooling. But it’s still too early to say if the speed bump will have turned into a ditch or a brick wall. There are plenty of other housing market drivers that are positive for prices.