web analytics

Housing NZ to build to sell

Written By: - Date published: 12:30 pm, October 31st, 2012 - 22 comments
Categories: housing - Tags:

Housing New Zealand is going to build some affordable houses in Christchurch and then sell them. It’s not a bad idea. In fact, if it were done right and en masse, it should have been a centrepiece of National’s empty ‘affordable housing’ announcment. But I fear it won’t be done right. It’s not enough just to build affordable homes: you need to make sure landlords don’t snap them up.

First, you need a capital gains tax to get the speculative money out of housing, which drives up prices in a giant ponzi scheme. That would give first homeowners a real crack at buying these houses.

Second, you could go beyond neoliberalism and determine the outcome, rather than leaving it to the market at all. Put a lien on the properties that they can’t be leased by the owners (with exceptions permitted by HNZ etc etc). By cutting the landlords out altogether, you would again make the homes more affordable for ordinary people.

Third, if you really wanted to make this work you would let Housing NZ tenants rent to own their properties with soft loans, which would be recycled into building more affordable, modern housing.

But, will any of these things happen? No. Not under National. These ‘affordable houses’ will turn out to be unaffordable as speculators, who are always going to be able to outbid a young family, swoop in and buy them up – then profit by renting them to those young families that they were built for.

22 comments on “Housing NZ to build to sell ”

  1. vto 1

    I see this and I wonder how Housing NZ will be able to do it any cheaper than those out there doing it now……

    The scale they are talking about suggests no economies of scale. They are looking at doing it together with developers so all the usual margins will be in there. Unless they are effectively doing it on a non-commercial return basis. i.e. out of the goodness of their hearts. But given the lack of heart in this government I simply don’t believe that.

    • onsos 1.1

      Nobody is bothering to build low cost housing. There is a lot more money for property developers in building more expensive houses. The government is not bringing down the cost of housing through its competitiveness, it is bringing down the cost of housing by doing something that property developers aren’t.

      • vto 1.1.1

        mr onsos, if you look around you will find housing options from under $40,000 (small and kitset) right up to $mullions. There is low cost housing, although (subtlety here…) it is expensive relative to what it should be. Compared to Oz house costs it is expensive on a square metre basis.

        The issue seems to arise in getting similar low cost land and then putting a low cost house on it. There is a missing match-up.

        The problem is multi-pronged.

        • onsos

          Not so much. Low cost land is low cost because it is undesirable. It is undesirable for solid reasons–it is expensive to live a long way from work and public transport, especially in a city with expensive public transport. This is why people pay high rents for substandard accommodation near the city.

          The answer is to increase housing density near city centres, and along transport corridors. This requires low and medium rise buildings. Answers that involve maintaining lower densities increase transport and infrastructure costs. That is, they are not low cost–and buyers and renters know this.

          Individuals and families cannot develop genuinely low-cost, medium density, low and medium rise housing. That is the domain of property developers. Property developers are not doing this because there is plenty of lower hanging fruit. It’s quite straightforward for government to do, however.

    • karol 1.2

      Rod Oram quoted some interesting stats on Nine-to-Noon yesterday.  They showed how much things had changed in recent decades.  Originally affordable housing was quite a high percentage of NZ new housing stock.  Now it is very low.  So what changed? 
      Oram rated the plans in Melbourne for affordable housing.  He said they are not extending the area in the city for building.  But they are doing things like building low level apartment blockss along transport routes, and integrated with shops etc.  It means it’s medium density, good for getting about, and still has a bit of a community feel.
      I couldn’t find anything directly with that plan online, but did find this 9 point plan:

      • insider 1.2.1

        WHat changed? A Labour government came in. Much of the acceleration according to Oram was under their watch.

        Ironically Rod spent much time admiring Melbourne as a city ignoring it is one of the most expensive home markets in the world – far more than any NZ city

    • Draco T Bastard 1.3

      It’s not about making them cheaper but about increasing profits, i.e, rewarding Nationals supporters.

  2. Draco T Bastard 2

    Housing New Zealand is going to build some affordable houses in Christchurch and then sell them. It’s not a bad idea.

    Yes it is as all it will end up doing is rewarding the banks.

  3. insider 3

    So are you saying you want a CGT on people’s homes to stop them selling them? Are you talking about all of them? And you also want to nationalise housing? Why not chuck in reindoctrination of the intelligentsia too.

    • vto 3.1

      Tell me oh great wise insider, in how many of mankind’s communities and societies and nations throughout history has there been individual dwelling ownership compared to communal dwelling ownership?

      It sounds from the tone of your comment that you are well clued up on this sort of thing and I would be curious to know…

      • insider 3.1.1

        Well in the English cultural heritage, the concept of individual ownership by other than the nobility runs back well over 1000 years. That is probably most relevant for our purposes when considering whether a groundshifting policy would be politically acceptable.

  4. Dv 4

    It is interesting that this was NOT announced by Bill yesterday?
    Dont the Nats talk to each other?

  5. Another doomed to fail scheme, and an attempt by the government to try and not live up to their responsibilities to the poor, working and middle class New Zealanders to provide state housing.

  6. millsy 6

    Sell the homes, but have the land as a 99 year lease…

    National policy to allow HNZ tenants to buy their home was a a step in the right direction (I was talking to a long-term state house tenant a few years ago who couldnt wait to be able to buy her home and do it up the way she wanted it), but where it fell over was providing no subsidy for tenants — they had to get a loan from the bank on their own.

    • PlanetOrphan 6.1

      One of the best Ideas I’ve heard M8!

      Would make ownership much more approachable.

    • fatty 6.2

      How about they just build them and give them away to people who have had a history of struggling to pay rent. But put them in with tight conditions for 10 years regarding the upkeep of the houses. If they get to 10 years and the house is in good condition, then they get to keep it.
      First in line can be people with children

      • Lanthanide 6.2.1

        Reward people who aren’t able to pay rent, while those who regularly pay rent get left out? Yeah, that’s fair.

        I also seriously doubt that someone who wasn’t able to pay rent for a state house would be able to do proper home maintenance over the course of 10 years.

        • fatty

          Nah…we could also help those who have managed to keep their heads above the water. We could do both. Don’t think of it as rewarding failure, think of it as not being a cunt.

          “I also seriously doubt that someone who wasn’t able to pay rent for a state house would be able to do proper home maintenance over the course of 10 years.”

          Really? …and why would poor people be incapable of keeping a house up to standard?
          If they do have a record of ruining a house, that’s probably cause they have nothing to lose, rather than an in-built tendency to wreck stuff.
          The big stick technique doesn’t really work with marginalised people…maybe we could try the big carrot instead?

  7. fatty 7

    Typical third way bullshit…the Government assists business and fills the pockets of the rich. Redistribution for the privileged.

  8. tracey 8

    Why dont we rezone inner city areas, like sandringham and dominion roads to allow maximum of 4-6 floor apartment blocks. All sitting on bus rputes and very close to rail.

    Use this as a model along main, non motorway, arterialnroutes

  9. SPC 9

    It’s a policy I advocated for Auckland a few years back – to create jobs and ease supply concerns. So I can only support this.

    But on the wider housing policy.

    It’s a tragedy that Bill English cites as a reason for inaction on the rise of values in Auckland – the prospect of homeowners having negative equity. Yet he will do nothing about the cause, people being loaned up to 100% loan finance. Is he saying the government will never allow property values to fall because they are continuing to allow 100% loan finance? Talk about a useless apologist for how things are, yet who is making no attempt to change anything. This speaks to his lack of credibility, or is it simply base self interest – a pro CG disposition.

    One could have lower deposit (on value of the home) requirement for first home buyers (they can be saving via Kiwi Saver), and a higher one for “investors”. Say 10% and 25%.

    Though I would allow a lower deposit level for investors building new homes.

    The alternative idea of a ratio between income and value to lending would of course diminish capacity to borrow against existing property – but this impacts on those borrowing against their home for business purposes. I’d rather just require a higher deposit level for second home purchase (and then set a maximum amount that could later be borrowed against such investment property – say 75% of the original purchase price and also 50% of current value so as to prevent property swaps).

  10. MrSmith 10

    The problem is with the banks and the absolutely stupid reserve bank policy of rising interest rates to check inflation.

    Rents put simply are just the interest on the money that was borrowed to build the house in the first place, interest rates rise, rents rise, inflation increases, the reserve bank rises interest rates, so rents rise, so less money in circulation and spending drops checking inflation.

    The Banks can’t lose whatever happens, the speculators like our dear PM clean up speculating and the man/women in the street gets screwed. At-least the Greens are talking about changing this rigged game, but watch the people who come out swinging against any change they are the criminals.

Recent Comments

Recent Posts

  • COVID-19 vaccine slated for possible approval next week
    The green light for New Zealand’s first COVID-19 vaccine could be granted in just over a week, Prime Minister Jacinda Ardern said today. “We’re making swift progress towards vaccinating New Zealanders against the virus, but we’re also absolutely committed to ensuring the vaccines are safe and effective,” Jacinda Ardern said. ...
    BeehiveBy beehive.govt.nz
    6 hours ago
  • New ACC Board members announced.
    The Minister for ACC is pleased to announce the appointment of three new members to join the Board of ACC on 1 February 2021. “All three bring diverse skills and experience to provide strong governance oversight to lead the direction of ACC” said Hon Carmel Sepuloni. Bella Takiari-Brame from Hamilton ...
    BeehiveBy beehive.govt.nz
    9 hours ago
  • Economic boost for Southland marae
    The Government is investing $9 million to upgrade a significant community facility in Invercargill, creating economic stimulus and jobs, Infrastructure Minister Grant Robertson and Te Tai Tonga MP Rino Tirikatene have announced.  The grant for Waihōpai Rūnaka Inc to make improvements to Murihiku Marae comes from the $3 billion set ...
    BeehiveBy beehive.govt.nz
    17 hours ago
  • Celebrating the Entry Into Force of the Treaty on the Prohibition of Nuclear Weapons
    [Opening comments, welcome and thank you to Auckland University etc] It is a great pleasure to be here this afternoon to celebrate such an historic occasion - the entry into force of the Treaty on the Prohibition of Nuclear Weapons. This is a moment many feared would never come, but ...
    BeehiveBy beehive.govt.nz
    4 days ago
  • Supporting disabled people to stay connected
    The Government is providing $3 million in one-off seed funding to help disabled people around New Zealand stay connected and access support in their communities, Minister for Disability Issues, Carmel Sepuloni announced today. The funding will allow disability service providers to develop digital and community-based solutions over the next two ...
    BeehiveBy beehive.govt.nz
    4 days ago
  • Voluntary saliva testing offered to quarantine workers from Monday
    Border workers in quarantine facilities will be offered voluntary daily COVID-19 saliva tests in addition to their regular weekly testing, COVID-19 Response Minister Chris Hipkins said today. This additional option will be rolled out at the Jet Park Quarantine facility in Auckland starting on Monday 25 January, and then to ...
    BeehiveBy beehive.govt.nz
    4 days ago
  • Next steps in firearms buy-back
    The next steps in the Government’s ambitious firearms reform programme to include a three-month buy-back have been announced by Police Minister Poto Williams today.  “The last buy-back and amnesty was unprecedented for New Zealand and was successful in collecting 60,297 firearms, modifying a further 5,630 firearms, and collecting 299,837 prohibited ...
    BeehiveBy beehive.govt.nz
    5 days ago
  • Jobs for Nature projects target iconic ecosystems
    Upscaling work already underway to restore two iconic ecosystems will deliver jobs and a lasting legacy, Conservation Minister Kiri Allan says.  “The Jobs for Nature programme provides $1.25 billion over four years to offer employment opportunities for people whose livelihoods have been impacted by the COVID-19 recession. “Two new projects ...
    BeehiveBy beehive.govt.nz
    5 days ago
  • New Public Housing Plan announced
    The Government has released its Public Housing Plan 2021-2024 which outlines the intention of where 8,000 additional public and transitional housing places announced in Budget 2020, will go. “The Government is committed to continuing its public house build programme at pace and scale. The extra 8,000 homes – 6000 public ...
    BeehiveBy beehive.govt.nz
    6 days ago
  • Prime Minister congratulates President Joe Biden on his inauguration
    Prime Minister Jacinda Ardern has congratulated President Joe Biden on his inauguration as the 46th President of the United States of America. “I look forward to building a close relationship with President Biden and working with him on issues that matter to both our countries,” Jacinda Ardern said. “New Zealand ...
    BeehiveBy beehive.govt.nz
    6 days ago
  • Jobs for Nature funding will create training and employment opportunities
    A major investment to tackle wilding pines in Mt Richmond will create jobs and help protect the area’s unique ecosystems, Biosecurity Minister Damien O’Connor says. The Mt Richmond Forest Park has unique ecosystems developed on mineral-rich geology, including taonga plant species found nowhere else in the country. “These special plant ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Pre-departure testing extended to all passengers to New Zealand
    To further protect New Zealand from COVID-19, the Government is extending pre-departure testing to all passengers to New Zealand except from Australia, Antarctica and most Pacific Islands, COVID-19 Response Minister Chris Hipkins said today. “The change will come into force for all flights arriving in New Zealand after 11:59pm (NZT) on Monday ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Bay Cadets learn skills to protect environment
    Bay Conservation Cadets launched with first intake Supported with $3.5 million grant Part of $1.245b Jobs for Nature programme to accelerate recover from Covid Cadets will learn skills to protect and enhance environment Environment Minister David Parker today welcomed the first intake of cadets at the launch of the Bay ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Cook Islanders to resume travel to New Zealand
    The Prime Minister of New Zealand Jacinda Ardern and the Prime Minister of the Cook Islands Mark Brown have announced passengers from the Cook Islands can resume quarantine-free travel into New Zealand from 21 January, enabling access to essential services such as health. “Following confirmation of the Cook Islands’ COVID ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Supporting communities and landowners to grow employment opportunities
    Jobs for Nature funding is being made available to conservation groups and landowners to employ staff and contractors in a move aimed at boosting local biodiversity-focused projects, Conservation Minister Kiritapu Allan has announced. It is estimated some 400-plus jobs will be created with employment opportunities in ecology, restoration, trapping, ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Border exception for some returning international tertiary students
    The Government has approved an exception class for 1000 international tertiary students, degree level and above, who began their study in New Zealand but were caught offshore when border restrictions began. The exception will allow students to return to New Zealand in stages from April 2021. “Our top priority continues ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Tiwai deal gives time for managed transition
    Today’s deal between Meridian and Rio Tinto for the Tiwai smelter to remain open another four years provides time for a managed transition for Southland. “The deal provides welcome certainty to the Southland community by protecting jobs and incomes as the region plans for the future. The Government is committed ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • New member for APEC Business Advisory Council
    Prime Minister Jacinda Ardern has appointed Anna Curzon to the APEC Business Advisory Council (ABAC). The leader of each APEC economy appoints three private sector representatives to ABAC. ABAC provides advice to leaders annually on business priorities. “ABAC helps ensure that APEC’s work programme is informed by business community perspectives ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Govt’s careful economic management recognised
    The Government’s prudent fiscal management and strong policy programme in the face of the COVID-19 global pandemic have been acknowledged by the credit rating agency Fitch. Fitch has today affirmed New Zealand’s local currency rating at AA+ with a stable outlook and foreign currency rating at AA with a positive ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Additional actions to keep COVID-19 out of NZ
    The Government is putting in place a suite of additional actions to protect New Zealand from COVID-19, including new emerging variants, COVID-19 Response Minister Chris Hipkins said today. “Given the high rates of infection in many countries and evidence of the global spread of more transmissible variants, it’s clear that ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • 19 projects will clean up and protect waterways
    $36 million of Government funding alongside councils and others for 19 projects Investment will clean up and protect waterways and create local jobs Boots on the ground expected in Q2 of 2021 Funding part of the Jobs for Nature policy package A package of 19 projects will help clean up ...
    BeehiveBy beehive.govt.nz
    3 weeks ago
  • New Zealand Government acknowledges 175th anniversary of Battle of Ruapekapeka
    The commemoration of the 175th anniversary of the Battle of Ruapekapeka represents an opportunity for all New Zealanders to reflect on the role these conflicts have had in creating our modern nation, says Associate Minister for Arts, Culture and Heritage Kiri Allan. “The Battle at Te Ruapekapeka Pā, which took ...
    BeehiveBy beehive.govt.nz
    3 weeks ago