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Key’s powerful speech on the urgent housing crisis

Written By: - Date published: 9:12 am, May 27th, 2016 - 41 comments
Categories: accountability, housing, human rights, john key, spin, you couldn't make this shit up - Tags: , , , , ,

John Key has given a powerful speech on NZ’s housing crisis:

Today, I want to talk in some depth about the declining rates of home ownership in New Zealand.

It wasn’t so long ago, in the 1990s, in fact, that New Zealand had a high level of home ownership compared to other countries. Not so anymore. We now have what has been described as the second worst housing affordability problem in the world.

Make no mistake; this problem has got worse in recent years. Home ownership declined by 5% between the 2001 and 2006 census to just 62.7%. To put that into context, home ownership for the preceding five years had been stable at 67.4%.

If you dig down into those numbers a little deeper, some worrying facts emerge. The share of homes owned by people aged 20 to 40 dropped significantly between 2001 and 2006. Young people – the people we most want to prevent joining the great Kiwi brain-drain – are really struggling to get onto the property ladder.

This decline shows no signs of slowing. In fact, on current trends, the crisis will only deepen. Home ownership rates are predicted to plummet to 60% within the next decade. And one of the biggest factors influencing home-ownership rates over the next 10 years will be the difficulty young buyers will have getting into their first home.

This problem won’t be solved by knee-jerk, quick-fix plans. And it won’t be curbed with one or two government-sponsored building developments.

Instead, we need government leadership that is prepared to focus on the fundamental issues driving the crisis.

The … most important reason for the home affordability crisis is one of supply. It explains why houses have become so unaffordable for so many people. Quite simply, not enough new houses are being built in New Zealand. This is a recent phenomenon. In many parts of the country, increases in demand for housing are now outstripping supply.

That imbalance is vividly illustrated in Auckland. In the five years to 2006, the supply of housing stock has failed to keep up with population growth. Again to put that into context, over the 15 years to 2006 the housing stock grew at a faster rate than population. So the supply problem is a recent one. Economics 101 would tell you that if the demand for housing outstrips supply, then the only way for house prices to go is up, up, up.

National’s goal is to turbo-charge the supply of housing in New Zealand by confronting the fundamental constraints that have kept a lid on it. By contrast, Labour’s instinctive reaction to the housing supply problem is to say the government must get in and build some houses. … I think it’s dangerous for the Government to pretend that developments such as that at Hobsonville are some sort of panacea to the housing affordability crisis.

Central and local government should always be aware of environmental and community concerns regarding new housing developments. But if we are serious about dealing with the housing affordability crisis, if we are serious about protecting the Kiwi Dream of home ownership, then we need to get a better balance between those concerns and their eventual impact on home affordability. To not do so is to ignore a fundamental long-term driver of the housing affordability crisis.

National’s infrastructure plan will go hand in hand with our efforts to confront the housing affordability crisis. We will free up more land to build on while ensuring new developments are served by the infrastructure they need.

Conclusion

Over the past few years a consensus has developed in New Zealand. We are facing a severe home affordability and ownership crisis. The crisis has reached dangerous levels in recent years and looks set to get worse.

This is an issue that should concern all New Zealanders. It threatens a fundamental part of our culture, it threatens our communities and, ultimately, it threatens our economy.

The good news is that we can turn the situation around. We can deal with the fundamental issues driving the home affordability crisis. Not just with rinky-dink schemes, but with sound long-term solutions to an issue that has long-term implications for New Zealand’s economy and society.

National has a plan for doing this and we will be resolute in our commitment to the goal of ensuring more young Kiwis can aspire to buy their own home.

It’s a worthy goal and one I hope you will support us in achieving. Thank-you.

How about that crisis eh? (There were several more instances of crisis deleted.) As I’m sure you have all guessed, that Key speech was from 2007. Since then all the housing crisis indicators (except interest rates) have got worse.

So what happened to National’s “plan”? Why didn’t it work? What happened to the “resolute commitment”? Why is the crisis worse now? Why are the homeless living in cars? Why is the budget full of “rinky-dink schemes”?

Why does Key (and Bennett) now say there is no housing crisis? Was Key lying then, or is he lying now? Does he care? Does it matter?

Eight long years.

Key housing crisis 2007

(Source)

41 comments on “Key’s powerful speech on the urgent housing crisis ”

  1. Ant 1

    it really is a good and powerful speech, but in terms of implementation qualifies as as the gold standard of hot air.

    • So what happened to National’s “plan”? Why didn’t it work? What happened to the “resolute commitment”? Why is the crisis worse now? Why are the homeless living in cars? Why is the budget full of “rinky-dink schemes”?

      Why does Key (and Bennett) now say there is no housing crisis? Was Key lying then, or is he lying now? Does he care? Does it matter?
      ……………………………………………………………………………………………………………………………………

      The answers my friends are contained in this equally as ‘ historic’ news article and were a harbinger of things to come and the real doublespeak behind this vicious govt.

      Have a read :

      http://www.stuff.co.nz/national/politics/10468960/Aroha-of-McGehan-Close-flees-NZ

      Not one thing has changed except that they have become far more arrogant and cock sure of themselves and their neo liberal bullshit spin.

  2. whateva next? 2

    Could this be broadcast nationally?It’s yet another brilliant example of National’s vacuous, muddled, confused, mixed messages:
    Katie Bradford reports after Little’s lucid and coherent speech last week on how a budget could look:

    Development, Steven Joyce, says Labour’s leader has his head in the sand.

    “Little’s speech was a pile of slogans unsupported by any facts at all.”

    So, Mr. Joyce where are the “facts” to support Mr.Key’s statement above, and where are the results?
    We cannot keep allowing National’s empty promises to float into the wind, yet seduce voters to support them next year.

    • This always reminds me of the sort of frivolous ,tacky values one might find at a party of the young Nats… I don’t know why… but what Id really like to know is …Who the ferk is Terry?!!?

  3. bearded git 3

    Superb bit of research Anthony. .where is the msm on this?

  4. Richardrawshark 4

    Should write him a letter asking him to explain?

  5. Sabine 5

    it’s only a crisis when Labour does it.

    when National does it its good for business, free market, and apple pie?

    he campaigned, he won, he has run out of fucks to give. Suck it up NZ. Get used to getting poorer.

  6. Sutton's li'l helper 6

    Little should read that speech out verbatim as if it were his own and see what the nats reaction is.

  7. ianmac 7

    Wouldn’t Winston be a good weapon using Rob’s excellent research? To again quote Key’s words back to him in the House and ask him if he agrees with it. Then tell him whose speech it was!

  8. TC 8

    Great ammunition to hoist the emporer using his own sword. Come on opposition get some fire in the belly and start winding him up.

  9. NZJester 9

    His speeches say one thing and his actions another.
    If John Key was to say the sky is blue I would now have to reevaluate my thinking that the sky is blue as very true words ever come out of his mouth.

  10. John 10

    Yet another U turn by Key who only days ago with his other cronies said there was no shortage. What are they saying now?

  11. AmaKiwi 11

    “Fight for issues, not personalities. Personalities will always disappoint you.” (Saul Alinsky)

    Alinksy would say, Politicians are ego driven and want personal power. That’s why you can never trust their words. They will speak passionately on any issue that will get them power, then forget about it. This John Key quote is a perfect example.

    Footnote: Saul Alinsky, author of “Rules for Radicals,” was the father of modern political organizing. His successes include the Black empowerment movement, women’s liberation, the anti-Vietnam movement, the California Farm Workers Union.

    As a university student, Hillary Rodman (Clinton) interviewed Alinksy. She didn’t think much of his ideas. Big mistake! In 2008 Obama used Alinsky’s tactics to beat her for the Democratic presidential nomination.

    Today’s NZ Labour party leadership abhors Alinsky’s concepts. They violate every principle in “Rules for Radicals.” That’s why Labour collapsed once Helen Clark was gone.

    • save nz 11.1

      Good points it is happening though. (the recent occupations outside banks is a good example to point back to poverty).

      In my view Labour and the left are going wrong as well because they are not taping into the ‘silent majority” aka middle NZ and actually blaming them for everything (in particular Auckland) and by doing that and targeting them for blame and punishment are pushing them right into National’s hands.

      From Wiki
      “Alinsky planned to arrange for large numbers of well-dressed African Americans to occupy the urinals and toilets at O’Hare for as long as it took to bring the city to the bargaining table. According to Alinsky, once again the threat alone was sufficient to produce results.[16] In Rules for Radicals, he notes that this tactic fell under two of his rules: Rule #3: Wherever possible, go outside the experience of the enemy; and Rule #4: Ridicule is man’s most potent weapon.

      Alinsky described his plans for 1972 to begin to organize the white middle class across the United States, and the necessity of that project. He believed that what President Richard Nixon and Vice-President Spiro Agnew then called “The Silent Majority” was living in frustration and despair, worried about their future, and ripe for a turn to radical social change, to become politically active citizens. He feared the middle class could be driven to a right-wing viewpoint, “making them ripe for the plucking by some guy on horseback promising a return to the vanished verities of yesterday.”[4] His stated motive: “I love this goddamn country, and we’re going to take it back.”[4]”

  12. save nz 12

    National stopped after freeing up the land for their mates to get profit. The cost of building is very high in NZ and all focus is on making money, not making houses. That is neoliberalism for you.

    As for trying to make a profit from building affordable houses, it is not possible for reasons too long to go on about and why would you when you are making more profit from luxury houses? That is why selling off state houses is absurd behaviour (if you actually want to provide social housing at the best cost for the taxpayer, which National don’t).

    P.s removing height from zoning will just make communities a war zone. So far the height issue is not making apartments – it is making larger homes – i.e. creating less affordable houses. So you have that nice view, goodbye under National (and Labour) when someone richer and more determined than you decides to knock it out. Yep, maybe some people don’t care about that, but height also blocks out light, which blocks out sun, which means people can’t use solar or natural means to heat their houses in the future.

    Also why is there so much demand on houses? Government policy on record immigration. It is the usual deception from National, blaming demand which they themselves have created – even having the property investor category to get a NZ passport and citizenship for new migrants to buy property here.

    • Treetop 12.1

      P.s removing height from zoning will just make communities a war zone.

      This has to be thought through carefully. When a neighbourhood dispute goes on for long enough four things happen, legal action, one party backs down, a compromise or a police call out.

      Sometimes you win, sometimes you learn.

      Auckland does it again with height zoning issues. I find the traffic and housing problems to be enough for the residents there.

  13. Once was Tim 13

    Christ! is all I can say… as well as maybe they’re beginning to feel the fear when they grow enough balls to think of the long term.
    If only a couple of the ‘half-decent’ Natzis could get together (they’re probably one or two of the ones considering a retirement before the nex lekshun goan forwid), if only they could rub a couple of original ideas together.
    But yeah/nah – too fukn hard eh?.
    Can down the road kickers – the most of them.
    Rest assured though, when they eventually claim victimhood – I’ve got better things to spend my emotions on – as will most Nu Zullunas

  14. weka 14

    Colour me cynical, but it looks like a very good speech if you want to win an election against an incumbent centre left govt with a strong leader. CT sticky little fingerprints all over it.

    • Draco T Bastard 14.1

      +1

      The political-right are great at sloganeering but totally suck at anything else.

  15. Draco T Bastard 15

  16. Treetop 16

    Footnote: English’s real estate has taken a knocking today, that’s ok cause Bennett can be the scapegoat again.

    English will be doing the maths over the weekend and his eyes are now on Horowhenua state housing homes.

  17. Keith 17

    John Key is full of shit, end of conversation!

  18. vto 18

    The problem he explained in 2007 is exactly the sort of problem he was meant to be able to solve because of his outstanding money skills

    The evidence is now in

    Fail

  19. Stuart Munro 19

    Eight years in government, no progress on housing. Key should sack Nick Smith and with his salary hire a builder – then resign for being a total failure as a PM.

    • Colonial Viper 19.1

      no progress in housing, but plenty of progress in housing prices.

  20. ropata 20

    The tweet from @timprebble (and this post) came from Winston Peters tying up the PM in knots in the House on Wednesday;

    • Muttonbird 20.1

      Look at the smug prick Key leaping up from his seat, an eager Pinocchio, then flopping down in his seat, a jowly Mr Creosote.

  21. Jenny 21

    The underlying motive in John Key’s 2007 speech on the “housing crisis” was to play up private home ownership. Preparing the ground for the privatisation of the State Housing Asset. Private Home Ownership Good! State Rentals fixed at 25% of income with full tenure bad!

    One of the first meetings John Key attended on his becoming Prime Minister, where he was greeted like a conquering hero, was the private landlords association.

    And indeed this class of parasites and wannabees have never had it so good.

  22. Lloyd 22

    A quick way to make housing affordable is to give renters the same sort of rights leaseholders have. If your landlord sells the property it should be just about impossible to evict you and the rental agreement should continue under the new owner at the old rental rate.
    A simple law change would remove much of the incentive where under the present legal situation speculators see housing as an investment where a short term tenant can help pay the mortgage and then they flick off the empty house at a higher price after chucking out the tenant. If the new owner has to accept the existing tenant at the old rental rate they won’t be able to cover the mortgage of the higher house price, so the value of the house can’t ramp up in the way it does now.
    John Key’s mates would squeal at this simple, practical German style solution.

  23. AmaKiwi 23

    @ Lloyd

    There are ways to drop the price of houses and rents, but National won’t do them because it would hurt their rich mates: landlords, banks, land speculators, and builders of expensive homes.

    1. Stop mortgage interest being tax deductible.

    2. End non-residents from owning land. Give them 2 years to divest all their properties to New Zealanders or face massive taxes.

    3. Capital gains tax.

    4. Convert unused factories and office buildings, etc., to state house apartments and emergency housing.

    National’s b.s. about freeing up land is a crock to protect the builders, banks and developers. National won’t do anything that will interfere with the rich getting richer.

    You noticed Key never once suggested the government employ trades people to build houses to be owned by the Crown. Never. They’ve got to keep the building contractors’ votes.

    • Lara 23.1

      Good ideas.

      For 2. though, if they don’t sell to a NZer with a NZ passport or NZ birth certificate then they forfeit the property to NZ Government with no compensation.

      That single thing alone would see property prices plummet overnight.

      Which is exactly why it would never be implemented.

  24. Dot 24

    This Country needs real leadership like it has never needed it before,
    making good decisions for an egalitarian society, eliminating severe poverty, respecting our environment , not spin and puffed up buffoonary.
    Real LEADERS do not regularly have to find someone else to blame.

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