Key finally admits there is a housing crisis but says it is all Labour’s fault

mickysavage
8 years ago
Categories: john key, making shit up, national, same old national, slippery, spin, the praiseworthy and the pitiful, you couldn't make this shit up
Tags: homeless, homeless crisis

John Key is finally accepting that there is a housing crisis. But he appears to have forgotten that he has been Prime Minister for the last eight years and is attempting to say that fault lies elsewhere.

He came out with a rather strange statement yesterday suggestion that under Labour residential price increases went up twice as fast as they have over National and implied that National was therefore doing a better job.

From the Herald:

Prime Minister John Key has defended the cost of housing in New Zealand, saying under his Government house prices had gone up only 43 per cent.

In response to Labour housing spokesperson Phil Twyford’s calls for the Government to “declare a state of emergency”, Key defended his Government’s actions.

“National house prices under the 9 years Helen was Prime Minister went up 102 per cent, under us they went up 43 per cent,” he said.

“Auckland house prices under them and under us, broadly in Census terms, went up the same. If it’s a national state of emergency now, in a crisis now, why wasn’t it when Helen was Prime Minister?”

Key told NewstalkZB’s Mike Hosking the cost of an average Auckland house is nine times that of the average earnings.

“To give you an example Sydney is 12 times and we’re about the same with Melbourne,” he said.

My jaw dropped when I heard these figures and I had a look around to see where they came from.

They appear to be based on changes to the QV residential price index. In September 1999 the index stood at 690. By September 2008 the figure had increased to 1,416 which was a 105% increase. Then by December 2015 the index was up to 2,032 which is a 43% increase.

Auckland’s prices went up from 669 in December 1999 to 1280 in September 2008, a 91% increase. In the 8 years since it has increased to 2319 which is an 81% increase.

The changes are shown in this graph. Auckland’s property prices steadily increased until 2008 when the Global Financial crisis hit. They have then surged since the beginning of 2012.

What does the QV Residential Price Index measure? Average QV for properties in the country. But in areas where there are dramatic increases QV valuations lag well behind actual valuations. For instance the QV of my property is not much more than half what the absolutely insane market would probably pay for it.

So there are a few problems with Key’s use of this index to back up his claim:

The figures are for the whole of New Zealand whereas the crisis is concentrated in Auckland although it is spreading.
The figures are dodgy as and increasingly unrepresentative of what is happening in the market.
There is clearly a recent surge in values in Auckland that this Government is doing nothing about.

This is classic Key and classic National. Find some statistics that back their contention. Use these figures even though you know they do not represent reality. And blame Labour.