National’s lies, damn lies and statistics on housing

Written By: - Date published: 10:05 am, June 9th, 2016 - 43 comments
Categories: housing, human rights, john key, national, paula bennett, useless - Tags: , , ,

Lies

Ahh remember this?

John Key: Homeless don’t want help

The Government has this week sent its flying squads into Auckland to battle the hidden homeless crisis, but says those living in cars simply don’t want help.

The squads were formed after The Nation revealed a number of people with full-time jobs were sleeping in cars because they couldn’t afford housing in Auckland.

Prime Minister John Key says the Ministry of Social Development (MSD) teamed up with the Salvation Army and other non-Government organisations and hit the streets. ….

The Sallies quickly responded, PM’s homeless remarks untrue – Sallies, they weren’t knocking on car doors and Key’s lie was damaging their ability to help the homeless. Now it seems that the MSD weren’t “out there” either:

Social Housing Minister Paula Bennett has admitted the Ministry of Social Development didn’t knock on car windows as part of its flying squad for homelessness, despite the Prime Minister saying they did.

Nothing that Key said was true – especially the implication that the homeless don’t want help.

Damn lies

When lies become policy they become damn lies. The ridiculous Nick Smith promised 500ha of Auckland land for housing, and spectacularly failed to deliver:

Housing Minister Nick Smith falls short on Crown land promise

Housing Minister Nick Smith has so far only managed to secure 25ha of spare Crown land for housing in Auckland after promising to deliver 500ha in last year’s Budget.

Smith spent his budgeted $52m on a mere 13ha of land. An utter failure.

Statistics

But Nick Smith is at it again, trying to lie with statistics:

Housing affordability in Auckland better than in 2008, says Nick Smith

Housing affordability is no worse in Auckland than in 2008, Housing Minister Nick Smith says.

Dr Smith pointed to home affordability data from Massey University while appearing before a Parliamentary select committee today. …

We’ve thrashed this out here before. The 2008 figure that Smith is citing is unreliable (due to the effects of the emerging GFC), and the “current” figure is not current (the market has worsened). The author of the study Smith is citing says he is wrong:

Affordability in Auckland improved slightly over the last three quarters, certainly not over the three terms National has been in government. He may be referring to the govt controls and IRD and RB LVR restrictions that have had the impact indicated in the last 3 quarters but his statement is wrong, misguided, political rhetoric, who knows?

The trouble with the “affordability” statistic is that it is (mostly) based on repayments vs interest rates. It takes no account of the risk (how screwed you are when interest rates go up), and saving the initial deposit required is increasingly impossible anyway. Here’s Greg Ninness at Interest.co.nz:

Affordability has worsened in Auckland

In Auckland, the amount of money typical first home buyers would need to set aside for mortgage payments on a lower quartile-priced home has risen from 48.8% in April 2008 to 50.5% in April 2016. So affordability has worsened in Auckland over the last eight years, even though mortgage interest rates have more than halved in that time.

Although the decline in affordability seems relatively modest, it masks a bigger underlying problem.Between April 2008 and April 2016 the lower quartile selling price of homes in Auckland increased from $353,600 to 666,600, up 88.6%.

Over the same period, the median take home pay of an Auckland couple aged 25-29 increased from $1297 to $1579 a week, up just 21.7%.Which means house prices in Auckland have increased at more than four times the rate of incomes for typical first home buyers. That creates problems for first home buyers trying to save a deposit. …

Which is why we see these sorts of headlines in the real world:

April 2016: Central Otago/Lakes joins Auckland as the second region in NZ where housing is now unaffordable for typical first home buyers
January 2016: Auckland housing at most unaffordable
January 2016: Auckland housing affordability worsens
December 2015: Getting harder to buy a first home in Auckland as rising property prices offset falling interest rates and incomes stay largely flat
January 2015: Auckland houses ‘severely unaffordable’
January 2015: Auckland housing affordability tumbles
January 2015: The First Word: Housing affordability ‘crisis point’
October 2014: Housing affordability plummets across New Zealand

The housing crisis is not going away, and National needs to offer something better than lies, damn lies, and statistics.

43 comments on “National’s lies, damn lies and statistics on housing”

  1. Richardrawshark 1

    Can’t help people who won’t fight for themselves. I’m sorry starting to get to the point that perhaps the hardships not enough yet for them to stand up and protest.

    Do they expect everyone else to fight for them. If your homeless perhaps move to Wellington and sleep at the beehive. maybe the smell will insight action by National.

    😛

    I know it’s harsh but I am perplexed at the state of the Nation yet no ones doing squat.

    • leftie 1.1

      The National government is a massive part of the problem, it doesn’t serve it’s agenda to do anything about it. When are people going to realize that National has no intention whatsoever of fixing the problem it is actively fostering.
      The only way to start tackling this crisis, that in the face of it, National vehemently denies, is to get rid of the National government. Kick National out of office. Until that happens, expect the crisis to get worse.

      • TC 1.1.1

        Youre too kind, working as designed by national and their choices.

        Migration based on money, sod any character tests
        No cgt
        No restrictions on foreign housing ownership
        Tax free funding facilitation
        Potray house prices as ‘proof’ of economic growth
        Dysfunctional supercity undermined by nactiod nimby’ers

      • Draco T Bastard 1.1.2

        The only way to start tackling this crisis, that in the face of it, National vehemently denies, is to get rid of the National government.

        Thing is, we’re not seeing anything from Labour Greens about doing anything about it either. Well, nothing more than tinkering at the edges. They know as well as National that dropping house prices by 87%, which is how much they need to be dropped by, will ensure that they only have one term in power and one term just isn’t long enough to even start undoing the damage that National has done.

        So, they’re stuck between a rock and a hard place. The only thing that they can do is to stop house prices rising while ensuring wages rise and return to capital decreases.

        • leftie 1.1.2.1

          Disagree Draco T Bastard. Labour and the Greens both have polices to tackle this, and both parties have been talking about it for quite some time now. Rather a government made up of the opposition with a plan, than the dismal, self serving failure, that is the current “don’t want to do anything” National government.

        • NZJester 1.1.2.2

          The problem with the opposition releasing plans to early is that National borrows some of the ideas. They then nurf it to it is ineffectual and then says, see we tried their idea and it failed to work!

          • Draco T Bastard 1.1.2.2.1

            +1

            Yep. Seen that happen time and again. Seen National twist ideas so that they become another subsidy from the poor to the rich as well.

    • M. Gray 1.2

      No they don’t expect everyone else to fight for them they expect to be treated fairly and like human beings. The best thing they can do is be encouraged to vote if need be take them to vote I do this with my family but they need a physical address to get welfare and to receive voting papers

    • Can we not start a movement or do whatever it is people did way back when

      • McFlock 1.3.1

        I was thinking about that a wee while ago, the lack of mass protests on issues that were unthinkable when I was a teen.

        Part of it’s the slow conditioning over the last thirty years to accept TINA and greed as natural, even necessary.

        But also the war on unions (labour unions and student unions). Those groups acted as some organisational focal points for community leadership.

        Now, back when those groups started, conditions were much worse – both in occupational safety and in general conditions.

        Thinking on the recent Dunedin hospital protests (both food and neurology), the protests had legitimacy from the support of the city council representatives. I think that gave them a lot of weight and the organisational clout to really pull it off (the logistics of march permits, getting people there without picking the one day nobody can go, street closures, liaison with the cops, all that jazz – even knowing where to get a loudhailer). Back in my student days, the association had some institutional knowledge on how to do that stuff, in addition to the placard painting workshops 🙂 . I assume the unions have had similar capabilities.

        There’s hope – people are getting better at organising stuff, and the fizzbook helps. And more people are looking for general change – there are hardworking grassroots activists spending huge amounts of time off their own bat on the Radio NZ funding issue or the hospital food problem, for example. They’re learning how to do it, and sharing their regained knowledge with others.

        • jcuknz 1.3.1.1

          My wife has sadly been in DPH several times over the past months and finds the food good wholesome and just what a sick person needs … balance that with her room-mate who thinks the Compass food is disgusting rubbish.
          I guess they are both right but with different expectations.

          • Stuart Munro 1.3.1.1.1

            It could be true – but equally your wife may be objectively wrong. What do the dietitians say?

            • McFlock 1.3.1.1.1.1

              90% of the junior doctors aren’t impressed by it either. They think it’s worse than what they’d previously been fed at their random and long hours of work.

    • G C 1.4

      I think that’s a little unfair considering the Labour and Green Party supporters have been crying out against homelessness and housing affordability for the past 8 years.

      Such supporters are looking to give Labour and the Greens a second chance. Less complaining about the disenfranchised and struggling who expend all their energies just scratching out a living.

      The struggle is real for most Kiwis, more effort from those elected to represent the working classes, rather than distain and resentment. What we are seeing is if the Left listen and articulate the needs of us Kiwis, we will get behind a change of government.

  2. save nz 2

    @ Richardrawshark When you are living in an old van with 6 kids while working – hard to rise up.

    But personally feel there is a movement of discontent gathering for change.

    • leftie 2.1

      Yes, and it’s not just the tragic consequences of the crisis itself, I think National’s arrogant denials, it’s lying and deceiving lipservice to the nation in the face of this undeniable ever growing crisis, is garnering a lot of hostility and angst.

      • The question then is… how many of us like a liar / like being lied to ?

        The answer is not many among us.

        And it is this that is the greatest asset for a rejuvenated Labour / Greens alliance in the form of the MOU. There will be mistakes made, some blunders… but at the very heart of it all is peoples innate yearning for honesty/ integrity.

        No one likes being lied to. And those that support a liar/ lie do so to protect their own self interests. And that is a powerful motive for many.

        Yet, the majority have no respect for being lied to… it will have consequences… the trick is harnessing that anger. And that is where credibility , honesty and integrity is the Lefts greatest asset. If they don’t present that and divulge into political mind gaming, and just turning out to being more of the same… any grand notion of ‘changing the govt ‘ just becomes a hollow and self defeating exercise. This MOU is going to be a hard road.

        It’ll have to be both constantly standing on the moral high ground and providing a pragmatic solution at the same time . It isn’t going to be easy , and the only way I can see it working is if there is constant consultation and honest appraisals carried out on a regular basis between the two . It is just so easy for negative outside influences to infiltrate and subvert any fledgling movement – particularly in this biased MSM environment.

  3. linda 3

    National and the country went all ont in houseing speculation it the money tap of imigration is turned off the whole mess collapses along with the economy and the national government
    You. Cant flick the switch off. On aponzi scheme. And these wankers. Really have screwed us over

    • jcuknz 3.1

      Since housing takes time to build, I have built a couple in my spare time, if the government started a building program of reasonable proportions the bubble would slowly ease away with luck or at least not increase the way ‘ do little or nothing’ generates. Building 40 a day, or completing them, unless at reasonable prices or reasonable rentals will not solve anything.

      • Pat 3.1.1

        even the announcement of a large scale state housing project would negatively impact prices and cause an exit for many…..its bloody hard to gently deflate a bubble.

  4. Enviro Gal 4

    —–and you add a smiley face to that to that negative comment [Richardrawshark]
    Some people don’t seem to have enough to do !
    A well researched story ROB.
    Surely refusing to recognize rising poverty and homelessness is the end of the line
    and people will get out and vote for a new government next year.
    There are new houses being built out here Orewa/Millwater but as you have noted the high prices put them out of reach of more than half of the population.
    Who are the buyers ? new immigrants, overseas buyers, will try and find out.

    • ‘ Surely refusing to recognize rising poverty and homelessness is the end of the line
      and people will get out and vote for a new government next year.’

      ……………………………………………………………………………………………………………………………………

      Ask yourself this:

      How far can human beings be pushed?… you agree neo liberalism by its very nature seeks to create an elite class and a mass pool of unemployed/ low paid workers…

      Now… throw aside all prejudices of what I’m about to say and take for example the ‘ untouchable’ class of India… or in fact the caste system itself. Translate that for a religious hierarchical system into a secular one…

      What therefore is the difference?… besides one being historic and the other being a modern mechanism to enslave… for the benefit of the few. And although eastern stoicism is entrenched… what about the historic English feudal system … or that of feudal Japan?

      These cultures survived for hundreds of years enforcing those societal divides through force, belief systems and simply … personal self interest. And all using various tools in various guises to enact governmental policy’s.

      If we think for one moment we can throw open the doors and expect the milk of human kindness to suddenly burst forth as a spring from those who have allowed / been conditioned to think not of the social good , but to deny democracy, to place the individual on a pedestal above all others… to view others as a stepping stone, a unit, a commodity with which to use… we place ourselves at a disadvantage…

      And it is for this very reason we have laws and regulations… to moderate the excesses of those who would work against the common good for personal self interests… if we think for a moment that these will have a sudden pang of consciousness , that they will see their error and become full fledged philanthropists overnight.. we will be disappointed.

      This weaning of people off the mentality of speculation and exploitation is going to be a long, hard process… it took neo liberal lies 32 years to permeate this culture… why should we think it will take anything less to unlearn this self centered thinking in a mere one or two terms of a true social democratic govt?

      We are all in this for the long haul . And much must be relearned.

  5. RedLogix 5

    Great article r0b .. and thanks for all the research.

    You absolutely nail the crucial point here: It takes no account of the risk (how screwed you are when interest rates go up)

    For those who follow Steven Keen this is the aspect that sticks out most vividly. Because while National can afford to electorally ignore the homeless, the families in vans and garages, young people still living with parents and little prospects of leaving, and desperate renters … this risk to homeowners if and when interest rates rise will hit hardest on their electoral heartland.

    Almost no-one properly evaluates or prices this risk, nor the handcuffs it places on government and fiscal policy.

    • Sabine 5.1

      the logic seems to be voting for National again so as to prevent this “interest going up” scenario from preventing.
      same reason as last election people voted for National so as to not end up with a Capital Gains Tax, and more houses – as was and still is labour policy – would have ruined the property value.

      Greed,fear and fiscal stupidity. A very ugly and lethal combination.

      • RedLogix 5.1.1

        Well if nothing else it becomes a powerful propaganda tool … get everyone deeply in debt and then play the “Labour will make interest rates rise” card.

        One thing is absolutely certain … John Key understands this idea very, very well.

  6. Richardrawshark 6

    -Enviro Gal it was a toungue actually look at it again. you know : and P didn’t come out looking like a tongue so I forgive you../sarc

    The gist of what I was implying went right over the argumentative ones heads.

    Why is there No action?, I’m here and bloody ready to fight for what’s right and nothings happening, at what point do people start complaining?, as they are heading into the gas chamber?

  7. Enviro Gal 7

    I accept your response @ Richardrawshark
    Poor people have limited options [going to Wellington?]
    and we need more people with understanding working for a better society.
    One where children in poverty get education and opportunities.
    Does anyone think that this government is supporting our good education system
    well ! not me.

  8. mikes 8

    Another thing i noticed about that Massey study that Smith is using is that they used the average income against the median house price. Why do thy not use median income against median house price.

    Someone suggested it’s because the average house price is dragged up by very expensive properties. But surely the same is true for income in that very high incomes drag the average up, hence the average is always much higher than the median.

    Surely median v median is a much more accurate indicator? (or average v average for that matter)

  9. Ad 9

    Westpac and ANZ will now no longer lend to foreign buyers:

    http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11653623

    All other banks expected to follow suit.
    When even the foreign banks accept Labour was right from the beginning, you know you’ve got a market crisis on your hands.

    Everyone: lower your mortgages as fast as you freaking can, and hold on.

    • b waghorn 9.1

      Load of PR dribble. I bet they lend sfa to overseas buyers.Its the banks that drive house prices . Banks are the no1 cause of rising house prices.

      • Ad 9.1.1

        The banks will be commenting on this tonight and tomorrow, so you can figure out whether it’s PR or not, and make your own judgement.

      • Richardrawshark 9.1.2

        Exactly foreign speculators will have their own foreign bank for logics sake.

        Why would they borrow in Zn when where they are they have their own bank manager, sounds like a PR stunt. Free advertising and trying to change the perception they are all for their aussie masters.

        • b waghorn 9.1.2.1

          Why would you pay 4% in nz when you can get .5% elswhere

          • tangled_up 9.1.2.1.1

            From the article:

            The majority of non-resident, overseas-based buyers would take out New Zealand bank loans for purchases here, unless they paid cash, Mr Patten said.

            “Most banks around the world won’t take security in a country other than their own…it is going to cut any overseas purchases out. They are either going to have to pay cash or have somebody in New Zealand purchase for them.”

            • Richardrawshark 9.1.2.1.1.1

              -tangled_up, cheers mate didn’t know that. Ok, it may be effective then. I must be in sceptic mode from so much BS lately. My Bad.

    • Debbie 9.2

      I suspect the banks have taken this stance, not in order to ‘correct’ the market but purely to protect themselves.

      When the market crashes, an overseas borrower can default and it’s near-impossible to recover the borrowings from abroad. A NZ-based borrower, however, can be pursued for their debt.

  10. hoom 10

    Does BLIP keep the Long List of Lies up on a website somewhere?

    Not that the Gre/bour campaign should focus on it but it’d be nice to be able to drop a URL from time to time when people deny there is any proof that Key is a lying sack of shit.

    • Richardrawshark 10.1

      They are currently working on a quantum computer to process it. If we could just get DR Nick to STFU for five minutes we’d get enough of a break in the bullshit to run a analysis.

  11. Paul 11

    Looks like the banks are taking the housing crisis more seriously than the government.

    http://www.radionz.co.nz/news/business/306011/rbnz-considers-property-investor-crackdown

    • tc 11.1

      Talk is cheap, we see a lot of that, whitewash inquiries, toothless measures, engineered recommendations etc. Cue a working group of nactiods and bankstas to kick this down the road.

      Banks never lose, they know a correction is inevitable but till then there’s money to be made and properties to foreclose on when it does happen.

  12. Jack Ramaka 12

    With land prices getting so high it is not economic to build low cost housing, rat boxes in Auckland going for $1.0 million, hence you are really just buying land value, it has been one big Ponzi Scheme fuelled by the Banks, Asian Investment, limited land supply, council building restrictions and Government Tax Policies which favour residential investment over other investment classes?

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