No need to worry about low levels of home ownership, National is here to lead. Here’s Key’s speech on the issue:
SPEECH: NZ Contractors Federation
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. … 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. National is ready to provide that leadership.
National will look for long-term solutions based on a sound understanding of the economic forces that have led to the contemporary low home-ownership rates.
Those forces can be grouped in two categories.
The first is demand-side. Sadly, in 2007, thousands of young New Zealanders have resigned themselves to never owning their own home. Since 2001, saving a deposit for a house has become increasingly difficult for too many of them.
Even though unemployment has declined, having a job hasn’t been enough to enable people to buy their own house. In 1999 a median-priced house cost just over 6 times the median wage. By 2006 it cost 10 times the median wage.
The second and 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.
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.
As you may have guessed, that speech was from way back in 2007. So how are we doing after seven “long years” of National’s leadership and action on the “fundamental issues”? Not so good:
Home ownership rates drop
New Zealand’s home ownership rate is now the lowest it has been for 64 years, Statistics NZ says.
(Note that the Stats NZ numbers quoted don’t match Key’s – where did he get his?)
Gosh, why did National fail so badly? They’re so good with the economy, aren’t they?