Lies, damn lies, and National’s housing affordability statistics

Written By: - Date published: 9:19 am, June 19th, 2017 - 39 comments
Categories: housing, national, useless - Tags: , , , , ,

Remember when Nick Smith caused much hilarity by claiming that houses are more affordable now than they were under the last government?

Remember when he did it again?

Remember when MBIE seemed to be trying to hold back housing affordability data?

Today the other shoe dropped:

MBIE ignored warning over housing affordability measure

The Ministry for Business, Innovation and Employment ignored advice from the Reserve Bank over its new housing affordability measure, and made houses appear to be more affordable than they actually were.

Labour Party housing spokesperson Phil Twyford said it was extraordinary the ministry went ahead and launched the measure knowing it was based on a “fundamental error”.

“If you assume there is a 1 percent difference between the rate they should have used and the rate they actually used … on a $500,000 mortgage over a 25-year term that would add $3500 in payments to the bank every year.

“That would make it significantly less affordable and I think it shows this measure is ham-fisted actually.”

Nor does the measure take account of the skyrocketing deposit that you have to save as a percentage of skyrocketing prices – so it’s not much good in the real world anyway.

Government ministers have claimed the measure is proof housing is now more affordable than when National came to power – despite house prices surging over the last nine years.

There doesn’t appear to be any upper limit to the brazenness of National’s lies.

39 comments on “Lies, damn lies, and National’s housing affordability statistics”

  1. Draco T Bastard 1

    National has to lie else no-one would ever vote for them. As their term in government progresses they have to lie harder as their policies undercut society.

    • NZJester 1.1

      Tiier biggest lie ever has always been Nationals claim that they are better at running the treasury books than Labour. Every time they get in the taxes for those on lower wages go up, wage increases for those on lower wages stagnate while the bosses and owners wages keep going up. Funding for essential services fails to keep up with inflation and government debt skyrockets.
      Funny how under Labour funding for essential services goes up, tax on those on lower wages goes down, wages go up, and our government debt drops.
      Most business might be paying more tax but they also tend to have higher after-tax earning under a Labour government. National Party policies stifle the economy and stifle innovation.

  2. One Anonymous Bloke 2

    “Ham-fisted”.

    That isn’t how you spell “dishonest”.

    • Craig H 2.1

      True, but since the measure is called the Housing Affordability Measure, HAM-fisted is punful at least.

  3. One Anonymous Bloke 3

    The only solution to MBIE is to close it down. Every part of it is tainted by Steven Joyce, like a black-mould ridden slum.

  4. saveNZ 4

    Natz are just lying idiots. But lying idiots in charge of a country.

  5. Bill 5

    So MBIE used a long term interest rate average as opposed to shorter term new rates that it got two days notice of from the Reserve bank? And MBIE now says it will “it would now change the mortgage rate used in the measure”?

    I’m going to put aside reservations about allowing the Reserve Bank to call the shots (it sometimes doesn’t end well)…

    With an allegedly less than optimum choice of interest rates, MBIE found that…

    …two thirds of renters and 80 percent of potential first-home buyers could not afford their housing costs.

    But hey. Should we just call the measure ham fisted (which it may well be) and ignore the headline?

    Rinsing and repeating.

    2/3rds of people in rental accommodation cannot afford their housing costs.
    4/5ths of potential first home buyers (how’s a potential first time buyer determined?) would not be able to afford their housing costs.

    And that’s probably a conservative estimate.

    • AsleepWhileWalking 5.1

      2/3rds FFS. And many of those will be receiving a government subsidy.

      • WILD KATIPO 5.1.1

        ” 2/3rds FFS. And many of those will be receiving a government subsidy.”

        Might have a lot to do with the fact that they are often the ones earning a slaves excuse for a wage in the ‘ Rockstar Economy’… funny that …. substandard , subsistence wages in the ‘Rockstar Economy’…..

        Indeed… the taxes used to subsidize the landlords will disproportionately come from those least able to afford them and GST – and most CERTAINLY NOT from the monied elites who had large tax cuts a few years back and put this country into debt aka through John Philip Key…

  6. Keith 6

    So some government department under Nationals guidance willfully manipulated information to suit the National Party to cover for their total incompetence. This is business as usual, night following day type of thing for National.

    The point is the headlines back when Smith was misleading read different and that was all that mattered. But having said that Smith sounded totally unbelievable so I don’t know if it was worth all the lying!

    • Bill 6.1

      Did they willfully manipulate?

      Two days before the reports release, the Reserve Bank said it was dumping the long term measure it had been using.

      MBIE released the report that had used the longer term interest rate.

      They now say they will change the rate they use in their calculations.

      Would the newer and possibly more accurate measure allow National to claim that housing costs are more affordable now than when they assumed office? Do I personally give a flying fuck? The current data shows that 2/3rds or renters and 4/5ths of potential buyers are financially screwed.

      Do people really think it’s important to argue that some few extra people would be struggling with a different measure when that level of bullshit is already on the table?

      • red-blooded 6.1.1

        You’re right that, either way, the report made pretty grim reading, Bill. I think you’re overlooking the fact that the MBIE advice wasn’t just that it was dropping the long term measure, it was (to quote RNZ) “this probably wasn’t the best measure to be using anyway”.

        It said the new customer mortgage rate was “more relevant for assessing affordability” whereas the effective mortgage rate was “the average rate on all outstanding mortgages”.” That’s because people who buy a house are mostly on the new customer rate, which is usually about 1% higher than the other one.

        I do agree that 2 days is bugger all warning. Still, the release could have been delayed while the issue was addressed.

        • McFlock 6.1.1.1

          Or at least they could have issued an errata or a qualification at the time, rather than waiting over a month to say “by the way, the figures are wrong and unreliable”.

          Sometimes this shit happens with data, and you have only a few options: publish with specific caveats; delay publication until you’ve corrected the data; publish with caveat and release addendum later on with corrected data; or hope nobody notices. Delaying a month to publish the caveat when you knew it was dodgy when you did the launch is only slightly better than hoping nobody ever notices.

          I’m a great fan at work of favouring long term comparability over specific accuracy of any particular measure (you look at the measure in relation to other indicators anyway, like a pilot monitoring the bank of instruments rather than just the airspeed), but this is a bit off.

          edit: and yes, I recall workplaces inserting errata into fully-printed outputs the day before delivery to clients. Sucks, but if you don’t come clean about it immediately it stuffs your credibility even more than just making a methodological cockup. Not as bad as another story I heard about a project that had to be canned completely after it was discovered that the results were nonsensical – after boxes of 5,000 expensive, glossy reports had been printed. And the Budget this year was a bit of a hash, too.

  7. Sorrwerdna 7

    So based on Twitford’s claim for $3500 extra per year the average interest rate used was around 4.75%. Reserve Bank suggest is should be around 5.75% . Does anyone know the timeframe used.

    • One Anonymous Bloke 7.1

      Yes. It’s right there in Twyford’s statement. I guess that’s why they call it “blind” hatred 🙄

      • Sorrwerdna 7.1.1

        Not the term of 25 years. The number of years used to calculate the average % rate

        • One Anonymous Bloke 7.1.1.1

          Why you’d expect an answer when you can’t even ask politely is beyond me.

          Whatever measure Twyford used won’t affect the fact that the National Party has been caught deliberately lying again.

          • WILD KATIPO 7.1.1.1.1

            When have they ever not?

          • gsays 7.1.1.1.2

            Hi oab,
            The fibbing nats changed how employment was measured and claimed a drop in unemployment.
            They changed water standards, now our rivers aren’t polluted.
            Now change the measures around housing affordability. Voila! No housing issues.

            I gexpect a news release from Nick Smith, redefining youth, as a means to end child poverty.

            Keep it up folks, it’s going well./sarc.

            • One Anonymous Bloke 7.1.1.1.2.1

              To be fair, it was the Dept. of Statistics who changed the measure. The Nats still lied about the figures.

  8. greywarshark 8

    What a nightmare housing is. I don’t want to be the pollie caught in the hippopotomas shower. Just make it go away someone.

    A house, a house, my kingdom for a house etc. Desperate!

  9. Siobhan 9

    As a maths illiterate could anyone please tell me; does this new calculation still make Labours $500,000-$600,000 houses ‘affordable’?

  10. Tanz 10

    Just received a Labour flyer in the mail today, saying that to address housing they’re going to build more homes and ban overseas spec buyers, but immigration is not mentioned. Why not? Our open-slather policy of eight hundred new immigrants every week into Auckland is surely one of the main drivers behind our ridiculous house prices (pushing up rentals as well) Once again, the elephant in the room ignored, it’s all about PC.
    Unitl immigration is addressed and for now, reduced, nothing will change. Floods of immigrants need housing, but so do the people already here. Why is immigration a no-go area?

    • McFlock 10.1

      Because it’s not housing policy. Immigration policy is immigration policy, and cancelling immigration will do little to sort out the Housing shortage.

      Check out the Labour website if you want a more holistic approach, rather than complaining that their housing policy doesn’t include their immigration policy.

  11. Tanz 11

    Good luck at getting votes then, people are not stupid, we all know high immigration is linked to the housing crisis, do you expect all would-be voters to flood your website as well? Those flyers are very expensive, yet they leave so much unsaid.

    • McFlock 11.1

      not my website. Not my knowledge, either, come to that.

      It just seems a bit silly to me how many people bitch that policy A, which concerns problem A, says nothing about how it would address problem K, when they could be asking what policy K actually is.

    • One Anonymous Bloke 11.2

      People are not stupid? Are you sure? After all, you claimed Labour had no immigration policy at all a while back, and that was pretty stupid.

  12. Tanz 12

    oh well, if you are happy to see us all sold out to foreigners, not to mention, our kids, fine, but I find it a complete betrayal that mass immigration is wrecking Auckland and beyond, stressed to the max on all fronts, no wonder NZ First is going to do so well, Winston isn’t scared to call black black and white white. He stands up for Kiwi Kiwis whereas the rest seem to prefer anyone else but white Kiwis and those here for generations. Go Winnie.

    • McFlock 12.1

      Well, I just hope you vote better than you use a reply button.

    • greg 12.2

      since you cant use google stupid!
      http://www.labour.org.nz/immigration

      • Tanz 12.2.1

        How nasty the left is in debate. In fact, there is no debate at all, just nasty name calling. Funny really. Yes, I shall be voting Winston, the only choice for New Zealand and New Zealand born New Zealanders. Who would ever ever vote nasty, bad tempered, regressive left, they want to hand it all away..and damn the consequences..no wonder Brexit and Trump happened.

        • WILD KATIPO 12.2.1.1

          Yep. Though I will be voting Labour this election I still like the old Warhorse Peters. NZ would have been sold out years ago if guys like Peters and a few others were not around. But the times they are a changing and a sense of a peoples right to national sovereignty is starting to emerge around the Globe. And thank goodness for that.

          The sooner we stomp all over these treacherous globalists and their BS neo liberalism the better.

        • One Anonymous Bloke 12.2.1.2

          How “nasty” is it when you tell lies? This is (at least) the second time you have lied about the NZ Labour Party’s policies.

          The first time around you were informed of the facts, and yet here you are again, lying.

          Obviously you thought your deliberate dishonesty would go unnoticed and unremarked. Or perhaps you don’t even realise you’re doing it. This is your wake up call. Stop telling lies and you’ll get a better reaction.

          Probably not linking to “blatant hate” sites is a good idea too.

    • Daveosaurus 12.3

      Mass immigration has been wrecking New Zealand since the 1840s.

      Most of the world’s immigration problems could be solved quickly and easily by sending the Saxons back to Germany, the Jutes back to Denmark and the Angles back to Schleswig-Holstein.

      • WILD KATIPO 12.3.1

        Bloody nice piece of history there mate!

        The only problem is if that policy were pursued today – I would have to be chopped in half, and sent back to ALL of those country’s ( and Norway ) you mentioned and the other half redistributed around various parts of England , Ireland and the Scottish Highlands !!! LOL !

  13. Nic 181 13

    It’s just another example of sheer delusion from the National party. They think we have; no housing shortage, no housing affordability problems, no one in poverty, no problems with the health services, no transport problem in Auckland that can’t be fixed by more roads and no cover up with political polls either.

  14. Nic 181 14

    It was with some amusement that I read of Napier Mayor Bill Dalton’s discomfit today,regarding beggars the Central Business District. It is highly inconvenient that the results of thirty five years of neo liberal politics are coming to fruition. Our current government regards homelessness, poverty mental health issues and addiction as items not worthy of acknowledgement. Unfortunately we all know these things exist and they exist in every city of New Zealand.
    Those of you who have read Charles Dickens, will recognise that we are re-visiting inequality and poverty big time. Our National government wants no part of this, indeed they are housing the homeless in motels, sending the bill to those living there and writing the cost off as a debt to be repaid. Who is nuts here?
    In the times of Charles Dickens, those at the bottom of the heap were rounded up and put in the poor house. Is that our next step? It would save a lot of money for tax cuts that’s for sure.
    We cannot make poverty go away by pretending it does not exist, we cannot make poverty and inequality go away by making it illegal.
    It is time to change the government!
    Nic 181

  15. Tanz 15

    Yes, A Tale of Two Cities and Oliver Twist spring to mind especially…indeed we are regressing to Victorian like times and ethics and values.

  16. Tanz 16

    [RL: Deleted link to a blatant hate site.]

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