Reserve Bank warning to property investors
"These developments, if fully understood by investors, should make them very cautious," [Reserve Bank chief Macfarlane] said. He said the risks posed by the current property boom were greater than in the 1970s and 1980s. Money for investment is more freely available this time and investors are more highly "geared", with borrowings in many cases around 100 per cent of the value of investment properties. Developers had also shifted the risk to investors by selling units "off the plan", with deposits taken well in advance of building commencing. Mr Macfarlane said many people on modest incomes had been drawn into the investment property market and some would suffer in the wake of the lingering housing boom.

Reserve Bank warning to property investors
"These developments, if fully understood by investors, should make them very cautious," [Reserve Bank chief Macfarlane] said. He said the risks posed by the current property boom were greater than in the 1970s and 1980s. Money for investment is more freely available this time and investors are more highly "geared", with borrowings in many cases around 100 per cent of the value of investment properties. Developers had also shifted the risk to investors by selling units "off the plan", with deposits taken well in advance of building commencing. Mr Macfarlane said many people on modest incomes had been drawn into the investment property market and some would suffer in the wake of the lingering housing boom.