may 27, 1979 - HCNZ lending rules change

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Muldoon’s Minister of Works and Housing from 1978–82, Derek Quigley, significantly altered the housing market with his decision to change the Housing Corporation’s (formerly State Advances Corporation) lending rules in April 1979. Henceforth, capitalisation and state loans could be spent on existing houses as well as on new homes. Quigley recalls that all ministers were required early in 1979 to reduce spending by 3%, and since the demand for new houses was such that they were now more expensive than existing homes, he decided to give firsthome buyers the choice of buying an existing home in an older, and usually more central, suburb. Sensible as that explanation seems, it severely affected on those companies concentrating on first-home construction. Not even the introduction of a Housing Corporation $4,000 suspensory loan to buyers who chose to build a new home arrested the decline in first-home construction. Fletcher Construction’s residential section contracted


Source: https://nzinitiative.org.nz/reports-and-media/reports/priced-out/

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