Housing affordability in this country is “just hopeless” –Hugh Pavletich

Housing Minister Nick Smith and Auckland Mayor Len Brown announcing special housing Sept 2014 [radionz.co.nz]

September 2014. Another 17 Special Housing Areas were revealed in Auckland, under the plan to accelerate new home building – only two of them outside the suburbs. Housing Minister Nick Smith and Auckland Mayor Len Brown announcing the special housing. Link Photo: Radio New Zealand

### NZ Herald Online 9:15 AM Monday Jan 19, 2015
Property: Mad truths on home prices in Auckland
Auckland housing affordability has worsened and it remains one of the 10 least affordable big cities in the world. Auckland’s surging housing market is now only slightly cheaper than London but pricier than Los Angeles, Toronto, New York, Perth, Brisbane and Boston.

█ The latest Demographia survey (1.74 MB), released today, compares prices with incomes in 378 cities, including 86 with more than one million people.

Auckland is one of the most unaffordable places due to its high house prices and low incomes. […] Now, the median house price has climbed to $613,000 and income to $75,100, giving a multiple of 8.2 and maintaining Auckland’s top 10 spot for unaffordable major cities.
Property Council chief Connal Townsend blamed Auckland Council’s planning regulations. “We’ve got houses more expensive than LA. How is this possible? A dump in Pt Chevalier demands a million dollars, which gets you a mansion in Beverly Hills. We’ve reached the point of madness.”
Survey authors Hugh Pavletich of Christchurch and Wendell Cox of the United States criticised the Government and Auckland Council for failing to ease affordability by vastly increasing housing supply via the Housing Accord and its 80 Special Housing Areas, but said the situation was bad in other areas too.

█ Building and Housing Minister Nick Smith said housing affordability problems went back 25 years but the Government was planning additional reforms this year, particularly around the Resource Management Act.

Analysis: So … what can be done?
Auckland is extraordinarily expensive relative to incomes and rents but the solutions need to be broader than what Demographia argues on land supply, writes Shamubeel Eaqub, principal economist at the NZIER.
Read more

Auckland Housing Accord (2014)
Under the terms of the accord approved between the Government and the Auckland Council, a total of 39,000 new homes/sections are targeted for approval over the next three years. Not all of those 39,000 have to be found specifically through the accord, as the figure includes all developments that might be approved in Auckland during that period. Link

Special housing areas - expected supply. Auckland 2014-2026 [interest.co.nz]Graphic via interest.co.nz [click to enlarge]

### stuff.co.nz Last updated 09:18, January 19 2015
Auckland in world top ten for housing unaffordability: report
By Laura Walters
The co-author of a survey which found Auckland house prices exceeded those in Los Angeles says housing affordability in this country is “just hopeless”. The 11th annual Demographia International Housing Affordability Survey classified Auckland as the ninth least affordable major city in the world. Auckland is the 14th least affordable city out of all 378 cities surveyed, and has been rated as “severely unaffordable” in 11 surveys done – less affordable than Los Angeles and the Gold Coast. “It’s just not on, is it? The social injustice of the whole thing’s just dreadful. It’s screwing up people’s lives big time,” said Christchurch-based Hugh Pavletich. When the cost of housing exceeded three times people’s incomes it showed there was a “massive problem” with infrastructure financing and land supply, he said.

NZ HOUSING AFFORDABILITY DROPS
While Auckland’s house prices were extremely high, Tauranga-Western Bay of Plenty, Christchurch and Wellington were also seen in the survey as “severely unaffordable”. Palmerston North-Manawatu and Hamilton-Waikato were “seriously unaffordable”. There were no moderately affordable or affordable markets in New Zealand, according to the survey. “Housing affordability has declined materially in New Zealand’s three largest markets over the last decade.”

Westpac chief economist Dominick Stephens said the high prices of New Zealand houses had a lot to do with the tax regime being favourable to home ownership and property investment compared with other forms of saving or investment.
Read more

Tephra Boulevard and Stonefields housing development, Mt Wellington, Auckland Feb 2012

Todd Property Group with Fletcher Residential – Stonefields is a 110 hectare development at Mt Wellington, located, only 8km from the Auckland Central Business District and next to the established eastern suburbs of Ellerslie, Meadowbank and St Johns. Photo: panoramio.com

Posted by Elizabeth Kerr

47 Comments

Filed under Architecture, Business, Construction, Design, Economics, Geography, Heritage, New Zealand, People, Politics, Project management, Property, Site, Town planning, Urban design

47 responses to “Housing affordability in this country is “just hopeless” –Hugh Pavletich

  1. Elizabeth

    Hugh PavletichHugh Pavletich (photo). Fellow Urban Development Institute of Australia (FDIA) and former Southern Division president, Property Council of New Zealand. Co-author, Annual Demographia International Housing Affordability Survey. More at Performance Urban Planning – http://www.performanceurbanplanning.org/

    Wendell Cox is a leading proponent of adopting land use and transport policies based on their effectiveness in improving the standard of living and alleviating poverty. He is principal of Demographia (Wendell Cox Consultancy) in the St. Louis metropolitan area – http://www.demographia.com/dwc-sketch.htm

  2. Elizabeth

    An almighty showdown is looming as the Government strives to balance two of the areas most dear to New Zealanders: home ownership and our clean, green status.

    ### ODT Online Tue, 20 Jan 2015
    Editorial: Heeding housing advice
    A new year has brought renewed concern around the vexed and complex issue of housing affordability. The affordability figure is calculated from the median price of houses divided by the median household income, to give a “median multiple” of 1 to 8.

    “Affordable” housing is 3 and under, “moderately unaffordable” is 3.1 to 4, “seriously unaffordable” 4.1 to 5, and “severely unaffordable” 5.1 and over.

    It is pleasing to see Dunedin’s figure has dropped to 4.6 down from 5.2 last year (with a median house price of $249,000 compared with a median household income of $54,400), although this is still in the “seriously unaffordable” category.
    Read more

  3. Elizabeth

    Environment Minister Nick Smith said overhauling the RMA was critical to addressing housing supply and affordability and encouraging economic growth, while also managing the environment.

    ### NZ Herald Online 5:57 PM Wednesday Jan 21, 2015
    Nick Smith announces 10 dramatic changes to Resource Management Act
    By Isaac Davison – political reporter
    The Government has outlined its plans to dramatically reform the Resource Management Act, armed with new research which showed environmental regulations added $15,000 to the cost of a new home and $30,000 to the cost of a new apartment. […] Dr Smith’s speech coincided with the release of a working paper commissioned by Treasury and the Ministry of Business, Innovation and Employment (MBIE). The paper by Motu Economic and Public Policy Research said a number of housing projects had been abandoned because of the delays and uncertainties in the RMA. The authors of the report said it was based on responses by developers, 90 per cent of whom had been affected by delays or uncertainties related to regulation.
    Read more

    Nick Smith’s RMA reforms
    1. Add management of natural hazards
    2. Recognise urban planning
    3. Prioritise housing affordability
    4. Acknowledge importance of infrastructure
    5. Greater weight to property rights
    6. National planning templates
    7. Speed up plan-making
    8. Encouraging collaborative resolution
    9. Strengthening national tools
    10. Internet for simplicity and speed

  4. Elizabeth

    Obviously, this tilt at the RMA is foreshadowed by DCC policy planners saying (was it quietly or informally?) that the 2GP will allow for, for example, “high rise” and developer-led intensification in the Dunedin City Rise area situated below the Town Belt (and beyond) – not simply “medium rise” as formally mooted to the unsuspecting, in council documents towards the (draft) “second generation district plan” and the vacuous consultation meetings had with local groups to date. It’s good-bye to quality neighbourhoods, received from not only your local council bureaucrats (ugh, do they really work for YOU ?!) but the National-led government in all its glory with slash-and-burn Minister Smith at the helm. Tremendous, folks.

    BUT. Dunedin has so little growth in employment and business generally (don’t place all your bets on pet projects like Cargo Cult Gigatown or City of Literature – JOKE…. too soon) to sustain the level of investment required for this perfect example of Government-mandated property speculation, such will give wealth and heat to Aussie Banks and Asian investors eg Auckland and Christchurch (along with MORE cheap imported labour and materials) – with the upper hand over our local small-fry developers who thought they might cream something, one day soon. Economics don’t work that way, SORRY. Let’s not spread Kiwi savings to business research and development, and a more diverse export economy. No way.

  5. Elizabeth

    22.1.15 RMA will do ‘nothing’ for house prices – Winston Peters
    Mr Peters said the proposed changes would not deliver affordable housing because the Government was unwilling to attack the real reason for it. By allowing immigration levels at levels vastly above the average for the past 20 years, the Government had fuelled the Auckland housing crisis, he said. “A ruthless, razor-like approach is needed to burst the Auckland house price bubble and this is not it,” he said. “If there is a problem in Auckland then solve it there instead of clubbing all of New Zealand.”
    http://www.odt.co.nz/news/politics/330815/rma-will-do-nothing-house-prices-winston-peters

  6. Elizabeth

    ### ODT Online Sat, 31 Jan 2015
    Housing affordability falls 14.1%
    By Dene Mackenzie
    Home affordability is heading for uncharted territory with Auckland topping the list of least affordable regions, followed closely by the Central Otago-Lakes district.

    Auckland sat at 40% above the national median, while Central Otago-Lakes was now 39% more unaffordable than the national average. Otago’s affordability is 61% below the national average.

    The Home Affordability Report showed in some regions the annual worsening was confined to single figures: Wellington (7.6%), Taranaki (7.1%) Nelson-Marlborough (5.5%) and Southland (7.5%). In all other regions, there were double figures: Manawatu-Wanganui (18.8%), Auckland and Hawkes Bay (both 16.4%), Otago-Lakes (15.4%), Waikato (13%), Canterbury (12%), Otago (11.5%) and Northland (10.5%).
    Read more

  7. Elizabeth

    ### ODT Online Mon, 16 Feb 2015
    Average Auckland house now $750,000
    By Simon Hartley
    Three-quarters of a million dollars is now the record average asking price for an Auckland home, with the Central Otago Lakes district running second highest in the country at $700,000. While the huge demand in Auckland and a lack of listings continues to skew national statistics, for the Reserve Bank the spectre of housing price inflation looms ever larger.
    Read more

  8. Elizabeth

    ### ODT Online Sun, 1 Mar 2015
    Average NZ house price is over $500k
    For the first time, the average asking price for a Kiwi home has shot above half a million dollars, according to new real estate sales figures. Nationally, the average asking price was now $511,421, according to data from Realestate.co.nz. That was 2.6 per cent higher than the previous record, set in January, of $498,471. Some areas were buyers’ markets, but in other regions, sellers had the upper hand. NZME
    Read more

    Related Post:
    5.2.15 Dunedin median house prices down

  9. Elizabeth

    ### ODT Online Sun, 8 Mar 2015
    How far home hunters can stretch their dollar in Otago
    By Hamish McNeilly
    The average national asking price for a home has topped half a million dollars for the first time. The Otago Daily Times takes a look at what you can get around the province for that money. […] And that amount – $511,421 to be exact – is just how much the average asking price of homes for sale in New Zealand during February.
    Read more

  10. Elizabeth

    There is plenty of capacity in the regions, if only someone would take note.

    ### ODT Online Tue, 7 Apr 2015
    Editorial: Regional solution to housing
    Housing affordability is a problem not going away for first-home buyers, despite the best efforts of the Government to provide some help to those anxious to start a life in their new home. New Zealanders love property and, as a nation, the emphasis has been for generations on the concept of owning your own home. […] Unfortunately, without some intervention, it appears a generation of young New Zealanders will be destined to rent their homes for their lifetime.
    Read more

  11. Hype O'Thermia

    The thing is, if you buy cheap enough you don’t need so much work. In Invercargill for instance, it’s a small flattish city where biking to work would not only be cheaper but almost certainly quicker than driving to work in Auckland. “A good job” used to be worth relocating for, but times have changed. Jobs good and scummy are both liable to vanish from underneath you, only a very trusting person would make long-term plans based on a current job. Nek minnit the company’s been sold, it’s relocated, the work is being done in the Philippines, hours are cut, new technology means whatever you were doing isn’t needed and while you may be able to retrain, chances are they don’t need as many people to operate the new plant so you quite likely won’t be needed – and nobody needs your old skills any more.

    Hours taken commuting to work are hours you aren’t growing veges, cooking slow cheaper food, doing your own house painting, etc.

    Small towns often have a great many casual and part time jobs for practical adaptable people. At the same time you’re making contacts and getting a reputation, so if you’re any good when someone has a vacancy for a full-timer you’ll hear about it and they’ll know you. The number of vacancies that are filled without advertising, without interviews… it’s not the right way for people who have a definite passion for a certain career, but for the poor blighters working 3 jobs to pay rent, chances are they’re the kind who’d do well in the provincial towns, hard working and prepared to tackle any job. And some of those towns have extremely cheap houses.

  12. Rob Hamlin

    Auckland – This quote (inadvertently in an article about the Ports of Auckland and their piers) says it all…..

    “New Zealand has an odd logistics situation. It exports a lot of what it produces from ports around the country but 70 per cent of imports end up within a 20km radius of Auckland’s port. Many other countries have more balanced flows.”

    https://nz.news.yahoo.com/a/-/top-stories/26964717/ports-of-auckland-has-nowhere-to-go/

    It would be most interesting to see what the separated balances of trade for Auckland and ‘everywhere else’ would be.

  13. Calvin Oaten

    Containers empty or full there is no gainsaying that Port Otago is a very important ‘cash cow’ to the Otago Regional Council. In fact the ORC recouped the $37.5 million it foolishly contributed to the ‘Fubar’ stadium in double quick time because of it. Another reason why it would be madness for the DCC to entertain the idea of taking back the obligation to run the local public transport system.

  14. Elizabeth

    CLASSIC DROSS | ‘MARKET FORCES’

    ### NZ Herald Online 5:00 AM Thursday Apr 9, 2015
    Housing NZ sells off ‘social’ land
    By Simon Collins – social issues reporter
    Papakura ‘low-cost’ housing site has more than doubled in value — first 50 houses will be sold at market prices. A big state-owned site in Auckland once earmarked for social and affordable housing is being carved up for sale – and the first 50 houses will be sold privately at market rates.
    The 24ha site formerly part of the Papakura army camp, between Walters Rd and McLennan Park, was bought by Housing NZ in June 2004 for $10.7 million. Its rating valuation has more than doubled to $23.4 million because of Auckland’s desperate housing shortage, but no houses have yet been built.
    In October 2012, the agency unveiled plans to build 450 to 500 homes, including 10 per cent state houses, 20 per cent other social housing and 70 per cent for private sale at prices likely to be “in the high 200s to the high 300s” – which would have made it Auckland’s biggest low-cost housing development for 25 years.
    Read more

  15. Elizabeth

    ### ODT Online Fri, 17 Apr 2015
    More calls for action on housing
    By Isaac Davison – NZ Herald
    New Zealand’s human rights watchdog has added its voice to those calling for drastic action to tackle New Zealand’s housing problems. Chief human rights commissioner David Rutherford said today all political parties should make a cross-party accord to tackle the “very serious” issues of adequate housing in this country.
    Read more

    ****

    Barnaby says this and more at ODT Online:

    NZ housing problems
    “On a local level, this is where the DCC could push an initiative to encourage people to settle in the South where housing is, relative to Auckland, extremely cheap indeed. If a fraction of the hundreds of millions squandered on stupid projects, the Stadium, the Town Hall and Settlers’ Museum upgrade, cycleways, a 28 storey hotel and camel shackles etc was invested in educating Aucklanders as to the incredible value in real estate, incredible choice of schools, no traffic jams etc, we might see a much needed turn around in the sorry state of our static and aging population. We have very unenlightened leadership with no vision.”
    Read full comment

  16. Elizabeth

    New Zealand is one of the few advanced economies to not have had a major house price correction in the past 45 years.

    ### ODT Online Mon, 20 Apr 2015
    Editorial: Serious housing imbalances
    Reserve Bank deputy governor Grant Spencer delivered a strong message on New Zealand’s housing imbalances last week which the Government would be foolish to ignore. In an extraordinary speech, Mr Spencer made it clear the problems in Auckland’s housing market needed addressing – urgently. Since late 2014, housing market imbalances have become more accentuated, particularly in Auckland where the supply shortage is the greatest, and house prices are particularly stretched, having increased threefold since the start of 2002.
    Read more

  17. Elizabeth

    ### scoop.co.nz 10:18 April 22, 2015
    Press Release – Massey University
    Housing affordability improves – but not in Auckland

    The latest Massey University Home Affordability Report underlines New Zealand’s “two-track housing experience”, says its author Professor Paul Gallimore from Massey’s School of Economics and Finance.
    Figures from the most recent quarter – December 2014 to February 2015 – show an improvement in affordability across New Zealand of six per cent, but Auckland and three other regions bucked this trend.
    “When you look at the past 12 months, houses in Auckland are now over 22 per cent less affordable while, for the country as a whole, the annual deterioration in affordability is only 10.4 per cent,” Professor Gallimore says. “These figures underline the ongoing two-track housing experience of New Zealanders.” Over the past year the 10.4 per cent fall in affordability has been driven by a modest 3.6 per cent rise in house prices and a 0.5 per cent rise in interest rates, which outstripped the 2.3 per cent increase in the average weekly wage.
    “But the situation in Auckland is quite different – wages actually rose at less than the national average while the median house price rose by a substantial 14 per cent, or $83,000,” Professor Gallimore says. “The recent improvement in affordability in many regions really accentuates the high costs in Auckland. Our largest city is now 49 per cent less affordable that the rest of the country – and that’s a larger gap than we’ve had at any other time in the 25-year history of the Massey Home Affordability Report.”
    Professor Gallimore says this divergence in regional experience is likely to continue throughout 2015. “While house prices are currently dropping in some regions, that’s not the case everywhere – most notably in the country’s largest city,” he says. “Will Auckland’s affordability continue to move apart from the rest of New Zealand? That will hinge on how supply and demand factors play out in that market, but the answer could well be yes.”

    █ Download the entire Home Affordability Report, which provides regional data, at: http://bit.ly/home-affordability-mar2015

    KEY FINDINGS:
    ● Annual deterioration in national affordability of 10.4%.
    ● Quarterly improvement in national affordability of 6.0%.
    ● Auckland is one of four regions (alongside Otago, Nelson/Marlborough and Taranaki) to show continuing declines in affordability over the last quarter.
    ● Auckland’s unaffordability relative to the whole country is now at its highest level since the Massey index began.
    ● Least affordable region: Auckland – 49% more unaffordable than national average
    ● Most affordable region: Southland – 52% more affordable than national average

    [ends] Scoop Link

    ****

    ### radionz.co.nz Updated at 8:09 pm on 22 April 2015
    RNZ News
    Home affordability gap largest in 25 years
    The home affordability gap between Auckland and the rest of the country is the largest it has been in 25 years. Massey University’s latest Home Affordability Report shows living in Auckland is now 49 percent less affordable than living in other parts of the country.
    It found there was a six percent improvement in affordability across New Zealand from December last year to February this year. However affordability slid by 0.3 percent in Auckland, 4 percent in Otago, 2.5 percent in Nelson/Marlborough and 1.2 percent in Taranaki.
    The report’s author Professor Paul Gallimore said in the past year wages in Auckland rose less than the national average, but the median house price rose by almost 14 percent or $83,000. He said there was nothing to suggest things would improve in Auckland any time soon.

    “You know it all very much depends on the next 12 months about how that supply and demand equation does work out…but it is time consuming process to change significantly the supply into a housing market so I would expect this trend to continue.”

    Professor Gallimore said while the latest survey showed wage rises in Auckland falling behind the rest of the country, this should not be seen as indicative of a long term trend. The most affordable region was Southland which is 52 percent more affordable than the national average.
    RNZ News Link

    Listen to more on Checkpoint ( 5 min 22 sec )

    ****

    ODT: Housing affordability gap stretches

  18. Elizabeth

    New rules come into effect in October, property investors buying in Auckland Council’s territory will need deposit of at least 30%.

    ### ODT Online Wed, 13 May 2015
    New restrictions on property investors
    Source: NZ Herald
    New restrictions aimed at Auckland residential property investors are not likely to lead to big rent increases, the Reserve Bank says. Some landlords have condemned 30% rental property loan-to-value ratio (LVR) rules, saying tenants will suffer, rents will rise and Auckland rental properties will become more scarce.
    Read more

    ****

    Any further imposition of country-wide LVR restrictions would be detrimental to nearly all markets outside Auckland.

    ### ODT Online Thu, 14 May 2015
    New LVR policies surprise
    By Simon Hartley
    Sweeping extensions to the Reserve Bank’s contentious loan to value ratio (LVR) banking restrictions tightens lending to Auckland property investors, but loosens lending elsewhere around the country. The changes have been met with surprise and, in some cases indifference, by economists and analysts questioning whether Auckland’s rampant prices will be corralled.
    Read more

    ****

    Doubt about whether overseas investors will be affected by new regulations.

    ### ODT Online Fri, 15 May 2015
    Editorial: Popping the housing bubble
    OPINION Action taken this week by the Reserve Bank to try to cool the Auckland housing market has been widely welcomed, although there are still some doubts about the effects of changing lending rules. Although the central bank still characterises New Zealand’s financial system as sound, it believes risks have increased.
    Read more

  19. Elizabeth

    John Key makes a pre-budget announcement that’s being touted as one way to help deal with the housing crisis.

    ### Stuff.co.nz Last updated 15:28, May 17 2015
    Tighter rules on residential property investors and overseas buyers video
    Speculators who buy and sell residential property for profit within two years will be taxed on the capital gains in a move to rein in Auckland’s housing market. Prime Minister John Key also announced Sunday measures targeting overseas buyers who have been able to escape paying any tax on their profits. Key said the measures would be contained in this week’s Budget and the focus would be on ensuring people buying and selling property for profit paid their fair share of tax to the Inland Revenue Department (IRD). The changes would tax capital gains on properties bought and sold within two years other than the family home or an inherited estate – but the government denies it is a capital gains tax.[…] Speaking to a National Party regional conference north of Wellington on Sunday, Key said people calling for a new capital gains tax often overlooked the fact that under existing rules anyone buying property with the intention of selling for a gain was liable for tax on that gain.
    Read more + Video

    ODT: PM makes move on housing profits (via NZME)

    • Elizabeth

      Governor Graeme Wheeler has today released proposed new restrictions that will mean property investors will need a deposit of at least 40 percent.

      Tue, 19 Jul 2016
      ODT: 40% deposits – Tough new investor rules
      Tough new rules on borrowing for investment properties have been outlined by the Reserve Bank – and banks have been told to act immediately. The new loan-to-value ratios (LVRs) lending restrictions would take effect on September 1, but the Reserve Bank wants banks to “observe the spirit of the new restrictions” in the lead-up to the new policy.

  20. Elizabeth

    New legislation will be introduced on October 1, the same day as new Reserve Bank lending requirements aimed at the Auckland property market.

    ### ODT Online Mon, 18 May 2015
    Buyer behaviour now key
    By Dene Mackenzie
    The Government has taken its first step to try to control the bubbling property market, but tax practitioners say there is much detail missing from Prime Minister John Key’s new property tax proposals. Mr Key announced yesterday Thursday’s Budget 2015 would include extra measures to ensure people buying and selling residential property for profit – including overseas buyers – paid their fair share of tax.
    Read more

    ****

    ### ODT Online Mon, 18 May 2015
    Editorial: Welcome addition to tax law
    Prime Minister John Key has finally acknowledged there is a problem in the housing market after months of shrugging off criticism the Government’s laissez faire attitude to property problems was unsound. […] Refusing to call it a capital gains tax, Mr Key says the Budget will provide Inland Revenue with extra funding for compliance and enforcement, require non residents and New Zealanders buying and selling any property other than their main home to provide a New Zealand IRD number. Non residents will be required to have a New Zealand bank account and get a New Zealand IRD number.
    Read more

  21. Elizabeth

    “We’ve got areas of Auckland that are local purposes reserve that haven’t had anybody play on them or use them for any recreational purpose for more than a decade.” –Nick Smith

    ### ODT Online Thu, 21 May 2015
    National | Budget 2015
    Affordable housing planned on Crown land
    Housing Minister Nick Smith says thousands of new homes will be built as part of a planned affordable housing development on vacant Crown land. The Government is planning to develop 430ha of vacant land in Auckland controlled by various government agencies. NZME
    Read more

  22. Elizabeth

    Rob Halcrow argues any further housing restraints by the Government or Reserve Bank will damage the regional housing market and make no difference to Auckland.

    ### ODT Online Wed, 27 May 2015
    Property problem is supply and demand
    By Rob Halcrow
    OPINION Much discussion has been bandied around regarding house price rises, particularly in Auckland and Christchurch. Since I joined my father’s real estate business in Auckland 50 years ago, the same discussions took place regularly although price fluctuations were not confined specifically to Auckland and Christchurch. […] Any increases in costs, particularly in the regions where values are static, can only result in one outcome – higher rents.
    Read more

    ● Rob Halcrow is president of the North Otago Property Investors’ Association.

  23. Elizabeth

    ### NZ Herald Online Mon, 15 June 2015
    Iwi to take land row to High Court
    By Isaac Davison – political reporter
    Government and Auckland iwi are headed to court over plans to sell off up to 500 hectares of surplus Crown land to private developers. Ngati Whatua and Waikato-Tainui confirmed tonight that they would ask the High Court to clarify whether they had right of first refusal on the land. Government is waiting on legal advice on the issue, but Prime Minister John Key insisted today that it was entitled to sell or develop the land without offering it to iwi first.
    Read more

  24. Gurglars

    The major problem is trying to fit all new entrants into New Zealand in a manifestly unsuitable area of land only 3km wide at the isthmus.

    A smart government/public service (an oxymoron) would long ago have brought in importation quotas. To smooth out the influx to ensure homogeneous growth across the regions.

    The New Zealand government has over time introduced carless days, import licencing, import licence tendering, interest rates of 26% etc.

    A regional immigrant policy would and still could be a doddle.

    Any migrant wishing to immigrate must go into a ballot and spend 5 years in the area so determined.

    For twenty years, until relevance is established, no migrants can settle in Auckland.

    No-one will be compulsorily sent to Dunedin as they will incur an immediate $15,000 debt.

    Migrants will be encouraged to go to Timaru, Oamaru, West Coast etc, areas which can sustain geographically larger numbers.

    Clearly Christchurch, Auckland, Wellington can not (earthquakes, volcanoes, unsuitable land) and Dunedin (unacceptable debt).

    • Hype O'Thermia

      What about the depopulated areas? Stewart Island, I think, was the latest to put out a call for a family, to keep the little school’s roll up.
      Many small towns are in the same position, with empty houses what’s more. Couldn’t they advertise through immigration/refugee services*, stating what they want and what they can offer by way of housing, jobs, schooling? Then because the new arrivals came as desired community assets, they would be welcomed into the community and helped to adjust. And though small communities can be insular and unwelcoming, when they welcome (and have an important to welcome with utmost friendliness) they do it so well! The smaller the community, the more necessary each member is so the more effort is put into getting them involved in community activities.

      *Actually why not the same to Aucklanders? The cost of housing (rent or buy) and commuting must for a high proportion of families tip “bigger job market and opportunities” in favour of living damn near anywhere else on the planet. Why fret about all those new houses when with a bit of imagination people could be persuaded to move somewhere else?

  25. Gurglars

    Hype, many, the majority of the Chinese immigrants do not need or want a job. What they want is a bolthole. With the possible addition of a casino, a yum cha restaurant and someone to talk to in their own language.

    Forget about their climatic requirements, Chinese live in the tropics and near the arctic circle, so they are adaptable.

    However for the reasons set out in my above rant, Dunedin suitable in most ways is off.

    So approve the parameters in a sparsely populated region and bring it on.

    How about Tuatapere becoming New Beijing? Casino, Chinese restaurants, mahjong parlours, nimby watching facility.

    Sounds great doesn’t it.

    (watch the nimbys come out to play)

    • Hype O'Thermia

      Actually I was thinking more of our refugee quota, and the NZ couples who have to work 4 jobs to pay rent/mortgage. People who may not have training for the kind of jobs that are only in a big city, the ones who are adaptable and ready to learn, ready to turn their hand to anything. Offer a job, or a cluster of jobs part-time and seasonal that together make up enough to live on if you’re not paying Auckland prices for housing and commuting and see what happens. A career is all very well, but if you can’t have a life too…….? If you hardly see your kids? The provinces, everywhere except the great cancer Auckland, shrink without the government giving a damn. So how about local councils, Rotary etc doing their own recruiting, in conjunction with schools that need to keep rolls up to keep the number of teachers and landlords and property sales companies? I think it is worth a try.

  26. Gurglars

    Surely Hype this particular council has done enough recruiting! I say enough.

    Councils cannot engender jobs except by staying well out of the business equation. It is the barriers to business that the council itself sets up to make businesses less viable, the council must step aside from its petty and in some cases pedantic requirements. Many of them designed to protect their own bailiwick.

    • Hype O'Thermia

      OMG no, not engendering jobs, I didn’t mean that. Cooperating with others, perhaps lending present staff to help with web site though probably something that’s already widely used like facebook, a “Come and live in” page to which all towns and localities that want to offer opportunities for newcomers could contribute info about the reasons someone would like to move to their jobs and houses.
      It’s something for the locals who know what they can offer and what their town needs, to arrange. But help with doing it, coordination, meeting space and some advice on practicalities, could and should be from as many as possible, which includes the council of each area. And not all councils are as out-standing* as ours.

      *out-standing, ie lacking enough sense to come in out of the rain, and take the weight off their feet.

  27. Elizabeth

    ### NZ Herald Online Wed, 1 Jul 2015 at 7:27pm
    New bill to give Government control over state houses
    By Isaac Davison
    Government ministers will have direct control over the sale of state houses if a new bill is passed.
    The new legislation, tabled in Parliament today, is designed to facilitate National’s plan to sell up to 8000 state houses to community providers.
    It gave authority to Social Housing Minister Paula Bennett and Housing New Zealand Minister Bill English to take over Housing New Zealand’s role in negotiating and carrying out the sale of state houses.
    Read more

  28. There is a silver lining here. Every three years we can boot out the minister if they stuff up the process or abscond with the funds. Under the public service mantra only dead people can be found guilty of theft, corruption and unearned entitlement.

  29. Elizabeth

    Section buyer Sujan Kotha was devastated when his contract on the McMenamin Place property was cancelled. [Albany]

    ### Stuff.co.nz Last updated 05:00, March 13 2016
    Couple devastated when developer tries to resell section
    By Maria Slade
    A young couple say they were duped out of their dream home when a developer cancelled the sales agreement on their section so it could resell the property for more money. Aucklander Sujan Kotha and his wife Kavya Reddyreddy were looking forward to building their family home in a 28-lot development at 6 McMenamin Place, near the Northern Motorway in Albany. In November 2013 they paid a 10 per cent deposit on a $403,000 section, with the condition that the owner would gain resource consent for the project before the sale was settled. They waited patiently for 15 months, denying themselves holidays and outings in order to save more towards their new home. Suddenly, in January 2015, the owner, J&H Development Ltd, cancelled the contract, claiming it had been unable to get resource consent. Kotha and Reddyreddy were devastated.

    The Home Owners and Buyers Association (HOBANZ) believes the case is far from an isolated incident in Auckland’s hot property market, and hopes Kotha and Reddyreddy’s story will prompt other affected buyers to speak out.

    […] Checks with Auckland Council revealed that J&H Development had never applied for resource consent to develop 6 McMenamin Place. The couple were then shocked to see their section re-advertised by Barfoot & Thompson, the same real estate agency which had originally sold it to them. The couple got a friend and a relative to email Barfoots separately, pretending to be interested buyers. They were told the section would sell for between $460,000 and $480,000. QV figures show average property values on the North Shore rose 12 per cent between November 2013 and January 2015. Auckland Council confirmed it received a consent application for a 28-lot subdivision at 6 McMenamin Place in November 2015, 10 months after the couple’s contract was cancelled. The application was currently on hold, awaiting further information, a spokesperson said.
    Read more

    █ The director of J&H Development is listed as Jun Zeng, who is also a shareholder along with Yan Qu.

  30. Elizabeth

    To make matters worse:

    ### msn.com 17 hours ago
    MSN News
    NZ ‘dumping ground’ for dodgy building products
    By Phil Pennington – Radio New Zealand
    A so-called grey market in dodgy building products is being investigated by the Ministry of Business, Innovation and Employment (MBIE).
    But two Aucklanders who train plumbers and council inspectors said they doubted it would make any difference, saying New Zealand was a dumping ground because the rules were weak. Darren Waith and Bill Wright both estimated half of the new homes being built here had plumbing in them that would be banned in Australia.
    Mr Waith chairs the National Plumbing and Pipelaying Standards Committee – which could be considered ironic, because he said there were no legally enforceable standards in New Zealand, and that was having a predictable result. “Dumping. An easy dumping ground for product,” he said. “It is not illegal – it’s not illegal to install them, it’s not illegal to import them or sell them. You cannot dump the product into Australia – everything must comply with their standards, which is their WaterMark.”
    Both men said it mattered, because bad plumbing was a health and pollution risk.
    Read more + Comments

  31. Elizabeth

    ### colinjames.co.nz Tue, 14 June 2016
    What’s in a house? The core of a good life
    By Colin James
    OPINION What’s in a house? A lot more than “housing”. The political noise around “housing” has got very loud. The government looks and sounds less assured as the noise level rises.
    John Key has thrown three ministers at it.
    Bill English, MP for 26 years, Deputy Prime Minister and Minister of Finance, is Minister Responsible for the Housing New Zealand Corporation (HNZ) which rents “social housing” to the needy.
    He has long been scathing about HNZ, despite recent improvement. He has been trying to pass some of HNZ’s houses on to not-for-profits because he believes not-for-profits are closer to the people and can be more innovative than a central government agency. But one by one the not-for-profits have cried off.
    An alternative is private firms.
    Read more

  32. Elizabeth

    At Twitter:

  33. Elizabeth

    At Facebook:

    Sun, 14 May 2017
    ODT: Labour to end tax breaks for landlords
    Source: NZME
    Party leader Andrew Little says Labour will phase out tax breaks for landlords and property investors in a bid to dampen property speculation and help first home buyers go up against property investors. Little unveiled the latest plank in Labour’s housing policy at the party’s election year Congress in Wellington today. He said Labour will:

    • Ring-fence losses on rental properties so they can no longer be used for tax breaks on other income. It will mean losses can only be applied to income from housing.
    • Use the estimated $150 million in increased taxes for $2000 grants toward insulation and heating.
    • Negative gearing will be phased out over five years.

    Little said in the past year, property speculators had escaped having to pay $150 million in taxes. The tax breaks benefited property speculators and those on high incomes and were heavily used by foreign buyers. “This will create a level playing field for home buyers and help families get a fair shot at buying a place of their own.” He said both the International Monetary Fund and the Reserve Bank had recommended removing the tax breaks. Cont/

  34. Elizabeth

    At Facebook:

  35. Hype O'Thermia

    Unintended consequences again, how come people come up with these well-intentioned rules and think the people adversely affected won’t change their behaviour?
    Landlords put up rents when obliged to put in extra insulation and heating! Shock! Doesn’t better quality cost more whether it’s shoes or house paint?
    Bring in a law about shoe quality and more people will be unable to afford new shoes. Bring in a law that paint has to have a certain amount of pigments and quality of resins and so on, and there won’t be cheap paint any more. And don’t get me started on sausages.
    Not saying people shouldn’t provide good quality, nor that as in this latest brainwave should be able to use profit/loss from one of their ventures to balance loss/profit in another … but anyone who thinks people won’t either alter the loss part to make it profitable, or otherwise organise their affairs so as to be no worse off, is dreaming.

    • Sanctuary Much

      Correct, but ‘rent rises’ is the reflexive position of property investors and Steven Joyce. Essentially, this means more public money to landlords by way of the Accommodation Supplement. Rent rises are always a given. They would not be with rent control.

      • Hype O'Thermia

        Rent control? You mean like Muldoon’s wage and price freeze?
        There’s something deeply barmy about insisting people improve their product at their own expense, but must not then charge more for it.
        It could result in investment houses being sold but unless they are bought by govt or councils as charity housing for the poor, there would be nothing to stop new owners if buying to rent from starting off at a much higher rent than the previous owner had been allowed to charge.

        Just imagine if dentists had been barred from increasing charges – there would be the expensive dentists with high tech, high efficiency equipment, and the cheap ones with treadle drills sold off by school dental clinics. Anyone else old enough to remember the treadle drills?

        • Elizabeth

          Good to keep increased charges (rent, power, phone etc) in line with NZ’s low rate of inflation – but that is not happening in the privileged domain of property speculation rife in this country. Bloody hopeless. As a long term stable central city renter I will be in a tent or under a bridge by age 65.

  36. Hype O'Thermia

    “Good to keep increased charges (rent, power, phone etc) in line with NZ’s low rate of inflation” – yes, but more to the point would be flattening the income line till it looks more like successful countries’. The reason an increasingly large number of people can’t afford to live in houses fit to live in, eat food that’s not only enough to fill their bellies but also keep those bodies working at optimal condition, participate in society’s activities, develop nurturing relationships and enduring family bonds isn’t that we want to be individuals lurching from one $20 note to the unpredictable next, unable to commit.
    Successive governments have fractured society, short-term in their own thinking, short-changing us. “Investment” by govt in us has been re-framed as spending, then re-packaged to fit the model by demanding hospitals etc act like for-profit businesses instead of what they need to be – necessary services, using their budgets first and foremost to treat sick and injured people.
    Social housing sitting empty because it’s “the wrong size” or “in the wrong place” (whereas living in a car is only slightly bad and not the wrong size for a family, and it must be in the right place otherwise they’d have parked it somewhere else, right?) without putting it to people in need of housing, “We’ve got this place, would it be OK for any of you people?” – because people always have moved for better conditions. To NZ, for instance….
    Unaffordable housing, unaffordable food isn’t primarily about houses or food being too dear. It’s about far too many being paid an appallingly poor wage compared with what it costs to live. WINZ top-ups aren’t the answer.
    Crazy part is that so many of the foully underpaid are necessary every day, and so many of the disgustingly over-rewarded [from the public purse, because “it’s a global market] are mediocrities who can go off on jaunts when there is s.f.a. of the stated purpose that couldn’t be done by video conferencing, and the results are of the insipid variety that Mike King inveighs against re the suicide prevention “strategies” – foster this, encourage that, change public attitudes towards something else.
    It’s about the money, that’s what. It’s about “fair suck of the sav” and “the worker is worthy of his hire” and those old sayings that expressed NZ’s belief in a fair go.
    It’s about the money. It’s about valuing contributions realistically, paying accordingly. You want the lavatories cleaned, your elderly rellies dressed and clean and their medication picked up from the pharmacy? You want this every day? So pay. Just because you understand clean toilets and Aunty’s inability to look after herself, doesn’t mean the people who do things you’re not sure about (what are they actually?) are worth SO much more.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s