However, [epidemiologist Professor Nick] Wilson reiterated the Government should take this opportunity to review the alert levels, adding additional steps at 2.5 and 1.5 to create a “more nuanced” system.
I disagree. The advantage of the current system is its simplicity and familiarity. In addition, regional rather than blanket changes in alert levels allows for a more focussed use of the currently available tools.
yes, whenever I see a headline like " expert claims this" I think of a lazy journo, ringing up someone, looking for an easy column filler. If you got all of the "experts', and all of the economists in one room, apart from hot air, I dont think anything else useful would come out.
"As soon as this pandemic is over and burgeoning Government debt is under control we’ll get moving again. Ardern and Robertson’s hands are tight tied."
I hope you are right and the vaccines (once administered) make a huge difference. But I have doubts that they will. Will we be able to travel overseas once vaccinated without isolating when returning? Hopefully the answer will be yes once enough of the population has had the vaccine. And will we be able to have tourists again (if they are vaccinated).
I'm pretty sure Clark meant to put benefits up too – but somehow she never got around to it. While the "hands are tied" is considered an excuse, it will never happen.
It is a particularly gnarly issue for this Government but luckily they get strong support and in a self-reinforcing self-interested way.
S&P cautioned that the country’s financial system remained susceptible to a sharp correction in property prices, but indicated it didn’t see that on the horizon.
It was, but even then it was easy to see that they either just don't get it, or actually believe that helping beneficiaries stops them from working or something (eg the lack of an upfront cash payment so beneficiaries could buy hand sanitiser and make plans at the start of the pandemic and going into lock down). Or being really cynical, that was an election year move.
Ardern and Roberston have a real problem here. Unless they do the big transformation (something like the GP policy, or using the WEAG report as a road map, and it has to include non-neolib responses to the housing crisis), they will continue to tinker and never get ahead of the problem.
Tinkering will mean many people will end up hating Labour. Not their core vote, but it will play out in the MSM and SM in the third term, and this is how we end up with Luxon as PM.
Right-leaning voters do not want livable income support levels. A third-way govt like this wants to keep those votes. They are counting on left-leaning voters having nowhere else to go.
Agree, although my understanding is that the government favours social insurance (or something like that) as the leading option, so they aren't doing nothing.
Grant was muttering about some insurance type scheme. Personally I wondered how anyone would be able to afford it particularly the younger crowd.
Even the better off pay income tax of 20%- 30%, GST of 15%, Student loan repayments 12% , ACC about 2%, Kiwisaver if they want a home 3% or more, all of which adds up to about 62% of their wages. Not much room to add anything to that.
Plus these schemes are catnip to the RW who at some future time would expand them and let the welfare net go.
Benefit raises would be good but I'm a lot more in favour of the lower paid getting better wages than continuing to subsidise employers. Wage and salary earners need a bigger share of the GDP plus spreading it more equally.
Also wonder if it’s time to go back to the old days of flat child benefits.
Income support levels have been at least 20% too low since Richardson's 'Motherfucker of all Budgets'.
The NZ economy is going very well post-COVID (for most people – not all) and move to restore them back to a 'liveable' level in this year's Budget. The opportunity and timing has never been better.
Ideally I'd love to see some form of GMI as a baby step towards reforming the entire welfare system.
I'd like to see a New Zealand economy that doesn't depend on public infrastructure to prop up our entire economy for years on end. It's kinda useful, kinda good at soaking up unemployment, but not going to to drive wages up higher enough to pull the working poor out of poverty.
I'd like to see an unemployment rate with the number 3 in front of it, and Maori and Pasifika unemployment down from 10 to a number 5 in front of it.
I heard that Robertson's main economic advisor for several years just gave up and left and went to the CTU.
We are far, far too dependent on government to be a high functioning economy.
"I'd like to see an unemployment rate with the number 3 in front of it, and Maori and Pasifika unemployment down from 10 to a number 5 in front of it."
Write to the stats Minister then….the numbers are largely made up anyway
Totally agree. Another way of putting it is that because so much of our economy effectively 'farms for capital gain rather than cashflow' – too much equity 'sticks' in places where it's not very productive. And as a result we finish up relying the govt (one way or another) to keep money flowing rather than private enterprise.
Which in turn means that opportunities to invest outside of property have been very thin indeed. It's become a very 'unvirtuous' feedback loop.
I keep coming back to the tranche of tax reforms that TOP were proposing, especially their Comprehensive Capital Tax, an intelligently designed measure that was specifically designed to address this exact issue. You don't have to like the party to look at the concept and think about pinching it.
I can easily see by the end of March New Zealand will have the Reserve Bank requiring an LTV ratio of 40% deposit to buy a flat, and also Governmetn making the Bright Line Test extend to 10 years for properties bought after Budget this year, and also Government proposing something tough like floating a maximum number of rental properties able to be owned by a single person or company or Trust that doesn't have charitable status, and also some stronger social or 'sweat' equity moves for getting people with poor credit records into home ownership.
And I would not put it past the major banks to go: we expect you to get to 60% equity within a year to bring down our Bad Debt risk which the Reserve Bank tracks. I think the major banks can read.
I think this Government in the mood to act.
After the May budget, those who are on a near-50% debt-to-equity ratio might start to divest a few more.
If they are leveraged that much that they’d do better to sell now before any announcement and get out with the handsome capital gain provided by the FOMO…it pays to panic first.
Stopping business that have owning property as part of the setup from running in interest only would be a good start ,many of the empire builders in farming never plan to pay principal so can pay over the odds for property,.
If they had to pay 3% principle every year then they could only purchase land at a cost that allows 5,or 6% profit each year.
On the contrary to your characterisation of TOPs politics, I disagree with their policy. The problem is their over reliance on economic theoretical ideas which have a poor track record in practice. On the UBI front this has lead to positions (from Morgan) where beneficiaries are thrown into an insufficient UBI regime without necessary topups based on their actual circumstances.
On the CCT proposal the basic assumption is that property and other investors are 'rational' (meaning they know the actual odds of their investments succeeding and invest accordingly, as if playing roulette). If they are not and don't then there is no reason for investment to reposition itself more productively in response to a CCT anyway. This is coupled with an idea that there is a relatively fixed amount of investment available to the economy and so its about how that is distributed. In practice the amount of investment isn't really traded off between sectors, somebody investing in their property business doesn't detract from somebody investing in their orchard business in almost every case. Of course you can always do your analysis by turning all these individual investments into proportions of total investment but that is not how the institutions involved work and looks like the tail wagging the dog form of analysis.
As you have identified, a lot of property investors don't seem actually rational, in fact they don't seem to even be investing very wisely and could probably be earning more in equity funds. At least we should understand everyone definitely isn't cashing out at present prices.
If you think that the CTU is equivalent to the office of the Minister of Finance, you're dreaming. Even the most starry-eyed socialist deep mole in The Terrace would laugh.
You should demonstrate your claim with OECD figures. The last I can find are from 2018.
I'd see an extra $70billion into the economy from government spend in just 2 financial years as a massive over-reliance on the government to prop up our economy.
The alternative of the economy cratering in response to lockdown would still seem to be vastly inferior of course.
But your looking at govt financial indicators of govt intervention and then concluding things about how 'normal' the economy looks. Say the RBNZ writes off 37% of central govt debt (which they could) does that make the economy 37% less govt involved? Well no, it makes no difference at all outside of the govt books. If there must be another lockdown then it should obviously be accompanied by a similar wage subsidy and this should be understood as sensible economic policy, not some unhealthy dependence of the economy on the countries policy.
As you've pointed out yourself before, ours is the government that has had to make the largest per capita set of interventions.
Pointing out that we are so brittle that the same scale of intervention would have to be done again is not a note in our favour. It points simply that we are one of the least resilient developed economies in the world.
This is completely incorrect. The government didn't have to intervene, they decided to and the economy is doing better than others partly due to that (and partly due to fewer lockdowns).
This is not a sign of economic weakness, its a sign that the government is able to intervene in the economy to halt recessions. In fact basically it works in the other direction and the willingness of the govt to step in will determine how much/little any recession bites. Other countries have done less and are economically weaker as a consequence.
It's sophistry to say they didn't have to intervene in what was the largest economic shock we'd had in a century. Even in the National counterfactual they would have intervened – as Canterbury showed multiple times over. Their intervention at scale is not a note of weakness on their part as government.
It is however an economic catastrophe.W hat's inarguable is the scale of shock we faced compared to other developed countries. Any of treasury's GDP graphs show it. Our largest industry has been shown to also be the most vulnerable to economic shock, and other large industries have been devastated. It's a very definition of brittleL easily snapped.
Most of this massive economic shift we are having to go through is being smoothed over with public spending on public projects. So in the medium term all we've been given is just the time it takes to do infrastructure projects to completely rebuild both tourism and tertiary education.
I remember reading about it in the Tax Working Group initial issues document which had charts, but that seems to have disappeared from their website. However, from memory, NZ is a bit under 30% for central gov't (not increasing this was also a focus of the 2017 election debates) and another 5% for local govt. OECD average is somewhat higher than that, mostly because of European countries with stronger safety nets and more subsidised education (for example).
Bill was the main economist voice of unions and consequently was on a lot of tripartite forums and working groups – hardly just a socialist in an office somewhere.
You don't need a study to be able to look at the numbers do your math and realise that the math of the government does not work.
Sadly we don't have someone like Katie Porter – who is good with numbers – and her magic white board to question the power that are currently as to their math, their compassion, and their fuckwittery that keeping people below the poverty level begging for help is going to teach anyone the value of work.
Maybe that would be a question for Jacinda Ardern, Grant Robertson and Carmel Sepuloni. Mind they know the value, that is why they are polititans and not workers.
I probably came across as being naive. I have been a benefit rights service advocate for 3 years 20 years ago. I still look up stuff. I am aware of the imbalance of income and the cost of rent.
A study needs to establish how many in a dwelling, how much income and the cost of rent or mortgage payments?
The median figure does not give a true representation of how much a person is left with once the rent is paid.
This looks at households with kids (because "Child Poverty Monitor"), but the MSD report (cited as "Perry 2019" in the current link) includes households with high "outgoing to income" ratios.
So the population is in income quintiles (20% blocks from poorest to richest), and we can look up a variety of stats on the proportion of household income that is spent on housing costs.
Again, relating only to households with kids, half of the poorest fifth of households spend more than 40% of their income on housing, while only 10-15% of wealthier households spend >40% of their income on housing.
I could probably look through the MSD report for specific information tomorrow if you want, depending on whether my boss is watching lol.
Some sort of precision monitor is required. If genome sequencing can be done for a virus the same needs to be done for the proportion of household income (of everyone recieving income in the dwelling) that is spent on rent and mortgage payment.
This would need to be expanded further for other living and health costs.
Basically, what statistic are you actually looking for? The proportion of household income spent on housing is sliced and diced multiple ways in the perry report. We can explore that before expanding the scope to other costs.
P40, figure C.11 Shows the proportion of all households that are paying more than 40% of their incomes on housing, by quintile. For the poorest quintile, it's 30%. But recall the same data with households containing children, it's ~50% for that quintile. So now we have an idea on the position of households without children, too.
Genome sequencing tracks a single type of virus as it infects from patient to patient. It doesn't really apply as an analogy to economic data as far as I can see.
Genome sequencing deals with precision, not the best analogy.
When it comes to data for housing I want to know what the income is without the accommodation supplement (AS) and then with the AS and if temporary additional support (TAS) is accessed for rent?
I just skimmed through your links and I will read them properly.
MSD has one or two people who do massive amounts of work on incomes material hardship.
The "incomes report" has a lot of before- and after-housing-costs information by demographic and income. The downside is that it's almost a data dump, easy to drown in, running to 360 pages. But if questions can be nailed down enough, it's pretty useful when talking poverty and equity.
maybe increase the number from 1 to 2 people working in that rather understaffed department to say maybe 10?
and if you only dumb raw data you can still say you did a report. You just have to know how to find it, read it, and put it together. Its done…here ….have the raw data and a few filters. That counts as doing it or cya.
Well good to now that despite pretty much all of the NGO's saying so, all of the non formal NGO's – local help groups saying so, and people like me and Weka or Bill and thousands others saying so Jacinda Adern has yet to make any statement about her statement before the election …….there will be no increase in base welfare levels.
She did not have an excuse then, and she still has no excuse. But she got her national voters to vote for her and her troupe of handmens, and I guess that was important to her.
Priorities, she has them, and one was getting re-elected and well now she is elected. Why on earth would she bother finding an excuse?
An incredibly popular proposal that a particularly popular PM could use their personal popularity to push for policy implementation:
A survey has found seven out of 10 New Zealanders believe the government should increase income support for those on low wages or not in paid work.
…
"Prime Minister Jacinda Ardern promised to govern for all New Zealanders but right now many members of our communities are being locked into poverty by low income support rates," Ruby Powell, the economic fairness campaigner from ActionStation said.
"The time for excuses is up. This poll shows the government has a clear social licence and mandate, on top of its moral obligation, to lift inadequate welfare payments to 'liveable' levels, and it needs to be done now, in this Budget round."
Raising income levels is all very well, if it happens, but until something meaningful is done about housing and rents it's a complete waste of time. We all know where the increased income will go – landlords' pockets.
Agree totally Rosie Lee – nearly 200,000 empty houses in the last census = property owners bricking their investments only looking for tax free capital gains.
The excessive commidification of housing has given us obscene numbers of empty houses while people are living in garages, couch surfing, in cars and on the street.
Exacerbating a housing shortage by "investors" bricking them also helps greatly distort rental prices in an upward direction. Can we have a large "ghost house" tax please……FFS
We all know where the increased income will go – landlords' pockets.
And from there is it will go into the capacious pockets of – the bank, the council rates, the insurance company, the property manager, the guys going gangbusters putting in insulation, kitchen vents, painting, replacing the hotwater cylinders, fixing windows, unblocking drains again, the lawnmowing dude, the people doing the smoke alarm inspection, the accountant, and of course the taxman.
Yep agree Red, when I used to work Public Practice accountancy (a fate worse than death), I can't say I ever saw many landlords making much in the way of income profit, or even a meaningful return on monies invested.
And then there's the stress of bad tenants, unpaid rent, damage, compliance requirements so on. Domestic rentals are sure not something that i would ever take part in.
#notalllandlords only works if the industry heads and most landlords aren't rorting. But they are. Yes, there are good landlords (mine are relatively good), but the point here is that there is a culture, sanctioned by lack of legislation and policy, that means landlords get to make excess income at the expense of poor people. It's just wrong.
Not sure when you were an accountant, but obviously the current situation is that many people are making very large sums of money from capital gains and that rents are going up beyond what people can afford to pay.
Weka, yes I agree that rents in many parts of NZ are getting to crazy and unaffordable levels, but I would disagree as to cause.
And yes again, huge tax free capital gains are possible, especially in the likes of Auckland, and I think that is the key.
I would strongly disagree that '.. landlords makes excess income…'. Of course some do, but in our society (for better or worse) both tenants and landlords need to understand that domestic rentals are a business, just like any other.
I am not too sure what '.. lack of legislation…' you are referring too, but the most obvious one and the most fairest would be to introduce a capital gains tax – and actually enforce it (taxing capital gains is already in the Income Tax Act, but I have yet to see applied by the IRD).
Its weird, if I sell a business asset for a profit, depreciation recovered is taxed, yet if I was to sell a domestic rental at a profit/capital gain, it is tax free.
P.S. I left public practice in 2007 and regained my sanity.
I still prefer the Green's Wealth Tax that they put forward at the election (or similar). It has the potential to reduce house prices as well as making NZ a fairer place to live.
Incidentally, and this is anecdotal, rents in Queenstown and Wanaka have dropped considerably due to the crash in the local economies due to the borders being closed.
ok, so you understand that what is happening now is completely different from 2007?
This piece from the Spinoff is an eyeopener,
We made 110% profit in two and a half years and once we pay back the bank we will have a new car, a holiday, and a lot left over. We put none of our own income into the property and ‘wrote it off’ against our personal taxes as well. It was all legal, and easy – like a joke really, or a game. And this story is nothing new or unusual in this country. It happens every day. It’s The Kiwi Way of Life, Simon Bridges said. If anyone ever tries to tell you they are not making money at this game, feel free to tell them they must be playing it horribly wrong. Landlords are making plenty of money out of this game.
Mum and Dad investors. And yes, they put the rent up by 1/3, not because they had to, but because "That’s what landlords do".
That is excess income. Both the capital gains and the rent increase. I'm not saying landlords should make nothing, or that it's not a business. I'm saying that too many landlords are making more than a living at the expense of poor people.
The legislation and policy I was referring to was tenancy rights. But yep, the govt needs to make major moves on the whole crisis, CGT is but a small part of that. They won't though, because people making money from housing is propping up the economy and too many of those people are Labour voters.
I bought our below average rental in its unpopular town, dragged it into the 21st century with a few improvements,
I guarantee you they bought it really cheap – spent a minimum on it – and then sold in a rising market. The difference between this story and providing a modern, comfortable, 3 bed home in a popular city suburb is night and day.
The people who wrote this piece were never landlords – they were property speculators right from the outset with no long term intention of staying in the business. That they rented it out for a few years was just a minor consideration on the side.
Can all of these nice landlords join the real estate lobby groups and ask for rent controls and housing quality standards? I mean, they're already charging below market rates for good properties, so they won't face the same costs as slumlords or profiteers.
that means landlords get to make excess income at the expense of poor people.
An actual 'in the hand cash flow income' usually only happen if the business is carrying no mortgage, and in the normal course of events it can take 2 – 3 decades to get to that stage.
Before this the owner of the business is often subsidising the company with their PAYE income from their day job. (The old LAQC tax smoothing scheme was introduced to specifically handle this almost universal scenario.)
And yes the capital gains have meant a big increase in equity – but that can only be accessed when you sell. Well not only can you only do that once – and of course on the tenant side it hugely contributes to insecurity of tenure.
Or if you refinance. At current interest rates, I am sure many are taking tax free cash out of their rental by increasing the mortgage, and this must surely be a contributor to rising rents.
Beyond introducing and applying a capital gains tax, I think only increasing supply can make a meaningful difference. Lets hope that now Twyford is gone, this term the government will make some meaningful increase in supply.
Supply is not the issue…as Christchurch demonstrates…zero population growth, excess subdivision and development and yet the prices and rents continue to rise.
The (main) cause is excess liquidity and the wrong incentives.
Hi Pat. I think that ChCh is a bad example. Since the earthquake the city has spread out hugely to the west, north west and south west. In the east of course, which has historically been lower cost housing, its just one huge barren landscape in many areas. The whole market is totally distorted.
The new dwellings are all of a certain type. Flashy, expensive and not really good rental material. So, I would strongly disagree that supply has increased in the rental market.
Agree with you re excess liquidity, along with interest rates sub 3% and the wrong incentives (lack of Capital Gains Tax).
PS: Are you sure that there is zero population growth in ChCh? That just seems counter to what I am seeing.
Would love to hear your views on other wrong incentives, and actions to take. This is a complex area for sure!
The growth is in Selwyn and Waimakariri…Christchurch city has barely recovered to its pre quake population…and the number of subdivisions particularly around Halswell and Hornby/Wigram makes the lie of insufficient land being a major driver, not to mention the number of unoccupied sites and unoccupied houses.
The wrong incentives relate to preferential tax treatment, artificially supporting above market rents with AS and no real control on outside speculation…we dont measure the true rate of offshore investment because we dont wish to have to address it.
The strategy is ever increasing house prices to provide the 'growth the financial system needs to continue as we have given up on being competitive with production.
Changing the incentives towards production carries big financial risk and will take time to show effect….risks the politicians (and in all honesty , most voters) are not willing to take.
Exactly. The equity is not locked away but can be used (semi-unlocked) in all sorts of various ways without having to sell up. It is completely different from an asset-rich but cash-poor super annuitant who cannot afford to pay the rates on their own home, for example.
The equity is not locked away but can be used (semi-unlocked) in all sorts of various ways without having to sell up.
It's not quite like going to an ATM. And once you stop working full time the big issue in accessing equity is serviceability. And of course with a bigger debt, comes bigger repayments, so all you've really done is kick the can down the road. I would only consider it in the event I had an investment opportunity that was going to put the equity to better use.
So yes you can go to the bank to get a bigger loan, but it's not 'free money'.
The bank only considers some fraction of the rental income. It's not usually enough by itself – they definitely want to see evidence of other income to cover your living costs.
Yes Incognito, pull out $100,000 tax free by increasing the mortgage by $100,000. Thats only an extra $60 or so per week in cost (tax deductible) for the landlord, which in turn can easily be passed over to the tenant in the form of increased rent.
And of course the reduction in equity (of $100,000) will be replaced over time by the capital gain. Yes, not 'free money', but a helluva incentive to take tax free money now and let the tenant pay for it.
There appears to be a renovation boom that’s partly driven by low interest rates and partly by Covid-19. Much of these are done with an eye on the future at which they need to give a return, e.g. a higher asking price when put on the market. This will drive up house prices for some time. The other thing to note is that some people will want or need to free up equity as you explained to fund those renovations. This, in turns, puts an upward pressure on rents. Lastly, some property owners will take the opportunity to renovate their rentals. You can guess what that will do to rents for a long time to come. It is too easy, relatively speaking, to get credit from banks and/or to free equity for property owners and I don’t blame landlords for that. Of course, the tax regime helps too.
Increasing your mortgage is not as simple as ringing the bank and demanding they give you money.
The three big hurdles are proof of equity, your ability to service the loan, and age.
Serviceability relates to income – and the bank never allows for the whole rental income. Usually they only count some fraction of it like 60% or even less. These days with rents so low compared to the value of the property (I know that sounds bizarre) this is usually the limiting factor on how much equity you can access.
Plus they have their own internal policies around exposure to specific risks that change all the time and you only find them out when you thought you had a watertight case – they say 'no'.
Increasing your mortgage is not as simple as ringing the bank and demanding they give you money.
That sounds more like an armed hold-up 😉
Actually, it is, although banks prefer things in writing so e-mail generally works better, via the internet banking channel, of course. In some cases, you won’t even have to go into an actual bank for anything! For example, do you know how easy it is to apply for a new credit card with a ridiculous limit? Hint: way too easy! Yes, I know, it is guaranteed but it is essentially the same thing: increased funds for ‘discretionary spending’ AKA consumption.
The three big hurdles are proof of equity, your ability to service the loan, and age.
Depending on your situation and what you’re instructing the bank to do, these are not all that big hurdles. Proof of equity is not always required if you have a long-term relationship (AKA history) with your bank and do all your business with/through them. They have their own ways of doing background checks too. Banks want to know about change of circumstances regardless whether you refinance and increase the mortgage on one property and decrease it on another (e.g. your home). Yeah, age is a bit of bastard but if you have a good personal super scheme a lot of things are possible with a kind and friendly bank 🙂
I guess my real point is that it's the wider housing market in NZ is where the locus of the problem lies. At present tenants are living in fear of the next rent rise, and their landlord who is likely doing their annual accounts this month – looks at their very thin, or negative, cash flow and realises the rents have to go up again.
So in essence Rosie is correct – unless this govt can find a package of measures to reduce housing costs and asset inflation – then any improvement in income support will indeed likely get absorbed in housing costs. Blaming the landlord does diddlysquat to fix this.
The anxiety will go down somewhat now that rents can now only go up once a year, it's now very hard to give tenants notice, and the minimum standards for heating and insulation have gone up significantly.
It might take a few months for all to catch up with that.
Simply really. Don't be a landlord if it's not working for you.
I was a landlord once. It came about not because I bought an investment property (that would be against my principles) but because I moved cities and I wanted to keep my house in the city I moved from in case it didn't work out in the new city.
I eventually sold it when I realized I wasn't going to move back. The realtor at the time broke the "bad" news to me that I could have been charging $100 extra a week in rent. I told him I thought I had charged a fair rent and thats what mattered to me. The rent covered my expenses a little bit plus.
I don't believe its o.k. to make a big profit out of offering a basic need to others.
to make a big profit out of offering a basic need to others.
What 'big profit'? Even if you'd been charging that extra $100pw that amounts to barely another $5kpa. Before tax.
As for ' basic needs' how do feel about your supermarket, and all their suppliers? Or any of the myriad other businesses/services you use to meet your 'needs'. Are all of these 'against your principles'?
I have absolutely no truck with this idea that all landlords have horns and a tail and are exploiting renters by making excess profits out of supplying basic needs. Of course some do, but in my experience they tend to be of certain migrant groups exploiting their fellow migrants. Most Kiwi landlords are just ordinary middle income people who think they will make their fortune in RE and find out its just not that easy.
they tend to be of certain migrant groups exploiting their fellow migrants
This isn't my experience, and this statement feels a little more problematic than "All Landlords are Bad" which precisely no-one in this thread has said except for you and RL.
No I never said 'all landlords are bad'. In fact have repeatedly said the exact opposite. Best you read my postings again if you think that. LOL.
As for migrant groups, browse through the court cases and prosecutions and you will see that two particular groups stand out for appalling rental abuses, the same two groups that stand out for paying appalling wages. LOL (which seems your default answer to everything Arkie).
No one is 'demonising all landlords', no one has said 'all landlords have horns and a tail'. You said both of these in response to reasonable criticism of the current system, it's disingenuous as no one was arguing that.
Otherwise I have no time for forming problematic opinions of migrants, thanks.
I do feel a bit sorry for you RL, but that’s just the way the cookie crumbles – not everyone can turn the size of profit they feel they’re entitled to.
The NZ housing market has many, many problems – and while for many people the rent they pay is the most proximate symptom of this, and the one they get most upset about – the root causes lie elsewhere.
Good to know. Re "root causes lie elsewhere", might the growing inequality of wealth distribution in NZ be a root cause?
In a more equal New Zealand we'll all be better off. Like anker, I don't believe its o.k. to make a big profit out of offering a basic need to others, mainly because that grows inequality, and inequality is, if not the root cause, certainly a root cause of social problems. A little bit like the love of money, tbh.
Life as a renter holds up the enticing possibilities of freedom and choice about when to move and where to live without the burdens of property ownership, debt and maintenance. The reality is that for many people on low incomes choice is seldom the case. The 90-day notice option for landlords hangs over every renter’s head. The desire to maintain social and community networks often means accepting sub-standard housing. Changing personal circumstances (separation, becoming a sole-parent, growing families, disability or illness) can suddenly threaten the ability to stay in your chosen home. The average tenancy lasts around 18 months which points to the transient and short-term nature of the NZ rental housing market.
Like anker, I don't believe its o.k. to make a big profit out of offering a basic need to others, mainly because that grows inequality,
And like anker I invite you to explain why you believe it's OK to provide other legitimate needs like food, clothing, etc for profit – but for some unspecified reason it's wrong to do this for housing.
Taken to it's conclusion this logic means that anyone who profits from providing housing – builders, banks, developers, material suppliers, etc – should all be condemned as equally illegitimate.
As for this idea that 'big equity = big profit' – well that's only partially true. It's not always so easy to access, and there are downstream consequences of doing so.
RL seems to be on the cusp of recognising an inherent flaw in capitalism: people profit most off folks who can't avoid it, regardless of the product or service.
Take the Hutt Valley landlord of a couple of days ago – literally putting someone out of their home of seven years because he wanted more money. Or the repeated accusations of profiteering by NZ's supermarket duopoly (didn't some supermarkets get bad press for hiking prices during the covid panic buying?). Or tobacco companies actively misleading their customers about addiction and health effects related to their product.
And many get a pass on their behaviour because "it's just business", as if greed is an excuse for exploitation. "Business" reduces every other person into two categories: a resource to be consumed in the production of the product being sold, or a customer to from which to extract as much money as possible.
Every person in a capitalist society is guitly of this alienated behaviour, the only question is the extent of our own personal guilt. But pretending that we're somehow the blameless exception is a fantasy.
When goods & services are sold, they change hands. You have certain protections under the Law too. It operates as a market as much as can be expected between fairly equal parties.
When a hotel charges for a room, it incurs GST. The price reflects quality of room & service and availability.
When a landlord rents out a property, nothing changes hands, and no GST is paid. There are few protections. The power balance is badly skewed in favour of the owners. There’s a relatively weak correlation with quality, at best. It seems to be scarce all the time.
Take the Hutt Valley landlord of a couple of days ago – literally putting someone out of their home of seven years because he wanted more money.
And as I showed at the time – the rent was still $100pw less than the market rent he could have asked. And you moan about it this.
What level of rent would you have been happy with?
people profit most off folks who can't avoid it, regardless of the product or service.
Well no – the tenant is in principle free at any time to leave with minimal notice and find something better. That they would prefer to stay and enjoy their community roots and connections – well that's their choice surely?
That in reality the NZ housing market isn't providing much in the way of better choices at the moment, is a much wider problem than just me providing a service to people that they're happy to pay for.
And as I showed at the time – the rent was still $100pw less than the market rent he could have asked.
No, you you made assumptions that a specific property was of a certain value based on only two dimensions: geography and bedroom number. You don't even know the dwelling could be legally rented out beyond 1 July, which would limit its "market rent" to the short-term low-quality section of the market, for a start.
That in reality the NZ housing market isn't providing much in the way of better choices at the moment, is a much wider problem than just me providing a service to people that they're happy to pay for.
"happy to pay for" lol.
But you obviously missed the bit where I said it was a wider problem than just being about you. Those particular blinkers are common in people "just doing business" – it's part of the alienation caused by the "wider problem"*
*It's capitalism. Capitalism is the wider problem.
The average tenancy lasts around 18 months which points to the transient and short-term nature of the NZ rental housing market.
In the first 15 yrs of running our business, this was pretty much our experience too. But not counting a couple of legitimate evictions that we had to undertake – in every single case the tenant moved on for reasons that had absolutely nothing to do with us, the quality of the unit, or it's affordability. Usually they just wanted to move elsewhere because something in their life had changed.
People rent mostly because owning just doesn't make any sense for them at this particular stage of their life. They value the flexibility renting gives them.
People rent mostly because owning just doesn't make any sense for them at this particular stage of their life. They value the flexibility renting gives them.
Alex, I'll take "What the more mild-mannered capitalists tell themselves to sleep at night" for $100, please.
No, you you made assumptions that a specific property was of a certain value based on only two dimensions: geography and bedroom number. You don't even know the dwelling could be legally rented out beyond 1 July, which would limit its "market rent" to the short-term low-quality section of the market, for a start.'
Do you have any evidence of these assertions?
And as a rule the govt tenancy website that lists rental bands is very reliable. In this case the band for this type of property in Wainui is $500 – 550pw and even the 'increased rent' was well under this at $430pw. For the purposes of this discussion it's entirely reasonable we regard this information as accurate unless proven otherwise.
Besides if we go with your idea that maybe the property was not legally rentable after 1 July – then why are we blaming the landlord? The tenant has been living there for seven years, and seems very unhappy at the prospect of having to leave – and if the landlord reluctantly decides to sell because he chooses not to keep throwing good money at it – then exactly who is to 'blame' here?
For the purposes of this discussion it's entirely reasonable we regard this information as accurate unless proven otherwise.
I'm not saying it's inaccurate. Population statistics do not give reliable inferences to individual case conditions.
I'm suggesting that the "bottom quartile" value is not the same as "absolute lowest rate charged in every tenancy agreement lodged in the last six months".
I'm suggesting that the "bottom quartile" value is not the same as "absolute lowest rate charged in every tenancy agreement lodged in the last six months".
Having spent 20 odd years doing this, all I can tell you is that the quartile bands pretty much cover at least 90% of new bonds lodged.
Sure there will be some exceptional outliers that fall well outside the band, but basing your case on them takes the discussion nowhere.
Sure there will be some exceptional outliers that fall well outside the band, but basing your case on them takes the discussion nowhere
So you didn't show that he was undercharging, as you previously claimed. You were simply guessing that a landlord who thinks healthy housing regs will force him out of the market was not renting out homes in the bottom 5% of value.
Now, you might be right and the landlord is a charitable dude. But in my 30 years in the rental market, charitable landlords are pretty rare. Easygoing, sure. Willing to ignore a missed payment if we ignore the slight fire hazard or poor maintenance, sure. But charitable? Rare as hen's teeth.
Given the tenant's circumstances – I'd bet good money on this being exactly the case.
And some landlords – especially the ones who're not using professional managers – put off increasing the rent until a change of tenancy. Given that on average this happens about every 18mths it's not an unreasonable, if somewhat lazy strategy, but it can bite you in the arse when a tenant stays for many years.
And it especially bites you in the butt when you realise the rent has fallen to 30% below market (530 – 380) *100 /520 and the govt is going to limit any future rises to 10% pa. Oh well unintended consequences and all …
Or he could just be kicking them out because although they were stable tenants for a substandard house, he won't be legally able to rent it out in a few months so needs to either fix it or sell it while it's rentable.
Or he could just be kicking them out because although they were stable tenants for a substandard house, he won't be legally able to rent it out in a few months so needs to either fix it or sell it while it's rentable.
Not really. Regulations are needed to keep arseholes out of the market, in order to stop people figuring out that capitalism is exploitation.
But it would mean that a particular home needs significant renovation or would most likely be purchased as owner-occupier home rather than a rental. But then the new occupiers lived somewhere else previously, so that home is freed up…
But of course that's all a distraction from your assertion that random landlord in the news is charging a low rent purely out of the kindness of his heart rather than the quality of his property.
But of course that's all a distraction from your assertion that random landlord in the news is charging a low rent purely out of the kindness of his heart rather than the quality of his property.
Because you have zero experience of being a landlord you have no reference point for what is likely or not.
What almost certainly happened here is an aggregation of factors – that he'd let the rent fall so far behind market (for whatever reason), and that he had determined a need to upgrade the property (for whatever reason) – and that new govt rules were closing down his opportunity to resolve both problems.
As I said – good rules but unintended consequences.
As for your implication that some alternate economic system (that you don't specify but I'm going to assume in the absence of information is some form of neo-Marxism) – would somehow quite magically not require any regulation … well here you are worrying about me making informed guesses about a business I know quite well.
Because you have zero experience of being a landlord you have no reference point for what is likely or not.
My "reference point" is every landlord I've ever had.
We know two things:
His rent was at the lower end of the scale; and
he was concerned that healthy housing regulations might force him out of the market
You might think they are largely unrelated.
And Big Tobacco just wanted to make cigarettes a more pleasant experience for consumers, not more addictive. /sarc
As for your implication that some alternate economic system (that you don’t specify but I’m going to assume in the absence of information is some form of neo-Marxism) – would somehow quite magically not require any regulation
There you go again, making shit up. I made no such implication.
And like anker I invite you to explain why you believe it's OK to provide other legitimate needs like food, clothing, etc for profit – but for some unspecified reason it's wrong to do this for housing.
Dear RL, I will politely but firmly reject your efforts to attribute to me beliefs that are not in evidence. At the risk of repeating myself, and as anker stated, I don't believe it's o.k. to make a big profit out of offering a basic need (food and water, sufficient rest, clothing and shelter, overall health) to others. Like anker, that's just the way I see the world.
Question for you; is NZ’s private rental market decreasing inequality, decreasing inequality, or making little difference to inequality?
Heck, since we're talking "root causes", why not go for broke. Is the current level of inequality in NZ sustainable? I don't see how it can be, but maybe the answer depends on personal wealth – which could explain why one’s answer might change over time
I will politely but firmly reject your efforts to attribute to me beliefs that are not in evidence.
And then you go and repeat the exact belief you claim is ‘not in evidence’.
At the risk of repeating myself, and as anker stated, I don't believe it's o.k. to make a big profit out of offering a basic need (food and water, sufficient rest, clothing and shelter, overall health) to others.
As I've explained carefully a number of times – your characterisation of 'big profit' just doesn't match up to reality. Unless of course you're talking equity inflation which applies regardless of who owns the property, and what purposes they put it to.
Personally I would much prefer just to run my business for a reasonable cash flow return and forget about the equity – because the moment capital gain becomes the main consideration I'm in a different kind of business altogether.
And that's a much wider problem across many NZ business sectors, than just residential rentals.
Careful RL, you're on quicksand. At 1:14 pm you replied to me:
And like anker I invite you to explain why you believe it's OK to provide other legitimate needs like food, clothing, etc for profit – but for some unspecified reason it's wrong to do this for housing.
I intepreted that as an attempt by you to attribute to me the belief that "it's OK to provide other legitimate needs like food, clothing, etc for profit – but for some unspecified reason it's wrong to do this for housing." As it was youwho introduced "supermarket" and "the myriad other businesses/services" (@3.1.3.2.3.1), and the idea of a distinction between shelter and other basic human needs vis-à-vis profits, into this thread, I politely reaffirm my rejection of your erroneous attribution of belief.
To be absolutely clear, it was you who introduced basic needs other than shelter into this thread, and I’ve made no distinction between the various basic needs when providing them for a (big) profit – that’s all on you.
, and I’ve made no distinction between the various basic needs when providing them for a (big) profit
OK so that's the answer I was looking for. Essentially you're rejecting the idea that it's acceptable to make profit. Which is a very common left wing sentiment but it just took a while to get it out of you.
And just one last time – in terms of cash flow most residential rental businesses make very little, if any profit, directly off their tenants. So that gets rid of your (big) qualifier.
Indeed the primary reason for anyone to stay in the business at present is in fact the capital gain – and as I've said before – there really is no particular distinction here between rentals and many other business sectors in NZ.
After all most farmers make most of their (big) money from capital gains – are you suggesting this makes their business somehow 'wrong' as well.
Essentially you're rejecting the idea that it's acceptable to make profit.
An intriguing conclusion, reflecting a common right-wing belief. I do believe that the pursuit of excessive profit is problematic, as is the definition of ‘excessive’ in this context.
Oh, the morality: why ethics matters in economics
Writing four decades ago and seeking to give some respectability to this ideological perspective, the right-wing US economist Milton Friedman posited that “the social responsibility of business is to increase its profits”. “Maximising shareholder value” is how it would be described today.
It should be patently evident, however, that this is not a reliable route to a good society. Five big problems bedevil the strategy: instability, insecurity, inequality, monopoly power and unsustainability.
Btw, any thoughts about these questions?
Question for you; is NZ’s private rental market decreasing inequality, decreasing inequality, or making little difference to inequality?
Heck, since we're talking "root causes", why not go for broke. Is the current level of inequality in NZ sustainable? I don't see how it can be, but maybe the answer depends on personal wealth – which could explain why one’s answer might change over time
Moral Recovery and Ethical Leadership
Interface’s customers were no different and had begun to ask what the organization were doing for the natural environment. The research division of the company organized a task force made up of the company’s international representatives to develop a response to this question. Anderson was invited to make an address to initiate the first meeting of the taskforce, and admits to not being initially interested in the question beyond the level of legal compliance.
In preparing to deliver this address, he read Paul Hawken’s The Ecology of Commerce (1993) which details the huge amount of irreparable damage which industrial processes inflict on the natural world. Anderson described its impact as a life altering moment in injurious terms: “Hawken’s message was a spear in my chest that is still there”. Anderson’s description of the impact of this knowledge, and his investigations in the damage that his own company was doing to the natural world, are full of the language of sickness. For example, near the beginning of Mid-Course Correction he writes that learning the amount of material extracted from the earth “made me want to throw up”.
Anderson’s ‘spear in the chest’ analogy has been described by him and others (e.g., Bakan, 2004*) as an ‘epiphany,’ but this paper posits that it might be better described as a moral injury. Epiphanies are “sudden and abrupt insights and/or changes in perspective that transform the individual’s concept of self and identity through the creation of new meaning in the individual’s life”. Epiphanies result in an individual changing their pre-existing idea of who they are, or what their life means. “The experience of epiphany involves an often sudden realization by an individual that they have been living their lives according to a framework that has not served them or others well, and a shift to another which is more positive”. Epiphanies, however, “are preceded by periods of anxiety, depression, and inner turmoil”. Moral Injuries, on the other hand produce mental anguish rather than preceding it. Prior to his engagement with questions of what damage being done the natural environment by Interface’s operations, Anderson initially “never ‘gave a thought to what we were taking from the earth or doing to the earth in the making of our products’”.
*Bakan, J. (2004). The corporation: The pathological pursuit of profit and power. London: Constable.
That's a whole other discussion – but in a nutshell if you want to make an argument to burn down the entire modern economy – because it's 'pathological' – then I'll call you on the inevitable consequences.
but in a nutshell if you want to make an argument to burn down the entire modern economy – because it's 'pathological'
It's a hackneyed argument, no future in it and best avoided imho.
Transitioning to a sustainable economy might be possible – some would say essential. But your defense of (and desire for?) big profits, and this critique of 'doughnut economics', don't fill me with hope.
Doughnut (economic model)
Branko Milanovic, at CUNY’s Stone Center on Socio-Economic Inequality, said that for the donut theory to work, people would have to "magically" become "indifferent to how well we do compared to others, and not really care about wealth and income.
Mmm… Donuts! Like profit, you can have too much of a good thing.
Question for you RL; is NZ’s private rental market decreasing inequality, decreasing inequality, or making little difference to inequality?
Heck, since we’re talking “root causes”, why not go for broke. Is the current level of inequality in NZ sustainable? I don’t see how it can be, but maybe the answer depends on personal wealth – which could explain why one’s answer might change over time.
Question for you RL; is NZ’s private rental market decreasing inequality, decreasing inequality, or making little difference to inequality?
The interesting thing about a society that's growing more prosperous is that the nature of that growth is more like multiplication rather than addition. The fundamental way to think of multiplication is that it takes a base vector and stretches it, while addition takes that same vector and shiftsit.
In other words as we become more prosperous, those who start close to zero tend not to move much, while everyone else does, and those with a small advantage at the beginning – all other things being equal – gain much more in absolute terms. So while everyone might gain at a constant rate – the absolute gap between the richest and poorest innately grows over time.
At core we should recognise that inequality is an unavoidable result of all human progress – and once we have this firmly in mind – we can then start to define why we think the extremes of wealth and poverty are a problem, and what actions we might take to start shifting the people at the bottom of the scale up toward those at the top. (A fundamentally different kind of operation to our pure economic growth model.)
And quite different than the ideas you seem to keep returning to which is to somehow cancel the modern economy so that we all collapse back into poverty. Sure that's one trivial solution to inequality, but most people are not going to think it an impressive one.
And what am I to make of your argument when all you ever seem to do is characterise modernity solely by it’s flaws.
More hyperbole RL? You’re nothing if not reliable. I have, however, written here about the benefits of modern medical care and treatments, e.g. vaccines, so make of that what you will.
Despite some Luddite proclivities I'm a fan of many aspects of modernity – quite dependent/captured in fact. This hasn't blinded me to its flaws, chief among them the unsustainable nature of civilisation.
At my age the prospect of collapse doesn't worry me on a personal level, but I do wonder how our collective love of money will play out for human civilisation.
“Man is a victim of dope/In the incurable form of hope” – Ogden Nash
Civilisation peaked in 1940 and will collapse by 2040: the data-based predictions of 1973 Their view is a bit sunnier, anticipating a world where global governments are forced to cooperate to solve complex problems, people widen their cultural horizons and work fewer hours, and limited consumption – not wealth – becomes a mark of prestige. Viewed today, it makes for an engrossing artifact, raising far more questions than it answers about humanity’s ability to effectively predict its future and correct its course.
In other words as we become more prosperous, those who start close to [or below] zero tend not to move much, while everyone else does…
At core we should recognise that inequality is an unavoidable result of all human progress…
Does it follow that less progress would mean less inequality? And is there truly no example of human progress that doesn't result in greater inequality? Personally I reject such a bleak worldview. Wealth inequality, and particularly the magnitude of that inequality, is a choice, one that we've both made.
And quite different than the ideas you seem to keep returning to which is to somehow cancel the modern economy so that we all collapse back into poverty. Sure that’s one trivial solution to inequality, but most people are not going to think it an impressive one.
You know my proposed solution to extreme poverty (perpetual indebtedness) in NZ . And you know that it doesn’t require that we “somehow cancel the modern economy so that we all collapse back into poverty“, but whatever floats your boat.
Why poverty in New Zealand is everyone's concern
Liang describes poverty as a "heritable condition" that perpetuates and amplifies through generations: "It is also not hard to see how individual poverty flows into communities and society, with downstream effects on economics, crime and health, as well as many other systems. Loosen one strand and everything else unravels."
A Kete Half Empty Poverty is your problem, it is everyone's problem, not just those who are in poverty. – Rebecca, a child from Te Puru
Does it follow that less progress would mean less inequality? And is there truly no example of human progress that doesn't result in greater inequality? Personally I reject such a bleak worldview.
Take a rubber band, hold one end of it fixed at some point on a table top and stretch the other end to say double the length. Congratulation's you've just doubled activity and wealth in this tiny little toy economy. (It's not an even close to accurate model, but it'll do for a first pass.)
Note carefully, while on average everyone is better off, the people who were close to the fixed (the poor) end have scarcely moved at all, while those close to the end you moved (the well-off) are now doing twice as well. And that while the gap between the poor and rich started out as say 1unit – the gap is now roughly 2units.
So while we've increased total prosperity on average, we've also increased relative inequality at the same time. What then is the best strategy for retaining prosperity while at the same time decreasing inequality?
Ideally we might propose releasing the fixed end of the rubber band so that instead of growth being all about stretching the band to achieve growth, instead is became more a case of shifting the whole band in the desired direction.
Closer to reality we might think of what has happened globally in the past 200 years as a combination of both stretching and shifting, that while the very richest have extended their wealth by some huge non-linear factor, the poorest in the world have actually seen their absolute position shift significantly as well. So all is not lost – we know that in practice something of what we would like to achieve can and has been done.
Part of the solution is I think going to happen anyway over the course of this century, as demographics age almost everywhere, the nature of economic growth may well shift from being dominated by 'stretch mode' as it has been for the past two centuries, to more of a 'shift everyone up mode'. And indeed the so-called “Elephant Curve” can be interpreted as a direct demonstration of this happening.
The other reason for hope is that capitalism in itself is not really an ideology, rather I see it as an emergent economic methodology that's demonstrated a remarkable adaptability over time.
What I do reject however is any suggestion that amounts to saying that inequality is all the pathological fault of the rubber band for being elastic and getting longer over time – and therefore we should burn it.
What I do reject however is any suggestion that amounts to saying that inequality is all the fault of the rubber band for being elastic and getting longer over time – and therefore we should burn it.
The rubber band is blameless. Burning it isn't a good idea – so smelly!
Could we perhaps stretch your rubber band analogy to include the 10% of NZers carrying a collective $13 billion of debt?
If so, then I would amend your analogy by placing the fixed point some 10% from one end of the rubber band, and then stretch the band in opposite directions away from that fixed point. Is growing debt (stretching the band in one direction) a necessary consequence of growing wealth (stretching the band in the other direction)?
One thing your analogy makes abundantly clear (pun intended) is that there's plenty of wealth in NZ, and that net wealth is growing all the time. What I don't understand is why those at the weathly end of the band (and if the band represents wealth, then the wealthy end is large indeed) suffer so greatly from ‘sharing hesitancy‘; it's almost as if what's happening at the other end of the band is of no concern. How might that play out? Still, it's only a rubber band; gummit will sort it out.
Let's not park that thought. If the 'top' 10% sacrificed ~1.6% of their collective wealth, that would be sufficient to forgive the crippling debt of the 'bottom' 10%.
While I acknowledge that a 1.6% decrease in wealth could cause mental anguish, it's doubtful that the material comfort of many 'top' 10-percenters would be seriously compromised. Some might even derive satisfaction from thoughts of the good their gift would do to improve the quality of life and mental health of tens of thousands of NZ families facing life in debt.
The questions you raise are intriguing, but IMHO they're poor reasons for doing nothing. If you have an idea for an easier way to address the indebtedness of the 'bottom' 10% of NZers, then by all means let's hear it.
In her essay below, Liang describes poverty as a “heritable condition” that perpetuates and amplifies through generations: “It is also not hard to see how individual poverty flows into communities and society, with downstream effects on economics, crime and health, as well as many other systems. Loosen one strand and everything else unravels.”
A Kete Half Empty
Poverty is your problem, it is everyone’s problem, not just those who are in poverty. – Rebecca, a child from Te Puru
What I don't understand is why those at the weathly end of the band (and if the band represents wealth, then the wealthy end is large indeed) are reluctant to share; it's almost as if what's happening at the other end of the band is of no concern.
As I hinted above, and the Elephant curve I referenced shows, the stretching of the rubber band globally has probably not been a simple linear 'stretch'.
At the very top 0.1% level income growth has been astronomical, and the coarse percentile aggregation in the graph hides that. At this level I think we both agree there is a very good case to unwind the gross extremes at the billionaire level and above.
But interestingly if we look again at the Elephant Curve, while it describes global income growth, the whole of NZ would probably fit in the percentiles from 90% up. In effect NZ's experience with growing inequality is only a small slice of a much larger global story.
And to loop back to something else we touched on a while back – you ask why it is that the extremely wealthy don't seem to 'care' about the fate of those so much further down the wealth ladder than themselves. This is a fair and valid question, and does touch on why I keep thinking that inequality is less of a strictly economic issue, and much more of a moral one. And that maybe arguing to 'smash capitalism' to solve inequality is a bit like burning down the house because your partner had an affair.
At present humans value wealth because of the status and power it bestows on them – perhaps a world in which wealth was seen as a means to improve society and be of service to others would see this whole question in a quite different light.
At present humans value wealth because of the status and power it bestows on them – perhaps a world in which wealth was seen as a means to improve society and be of service to others would see this whole question in a quite different light.
Well said RL, certainly we can agree that some people value wealth because of the status and power it bestows. For myself it's about financial security, which in my case doesn't take much wealth.
What behaviours might model the sharing wealth to reduce inequality and be of service. Philanthropy, certainly, but how to grow charitable behaviour? So many seem to be in need in NZ alone.
Is there something similar to GiveWell for Australasia?
Btw, I’d like to meet these people that are arguing to ‘smash capitalism’ to solve inequality and give them a stern talking to. But I do wonder if ‘sharing hesitancy’ and capitalism are inextricably linked, and if so then what’s the best way to decouple them.
Still had to pay the bill for it this year out of this year's cash flow. And as a capital improvement item it will be depreciated off taxable income, that doesn't mean 'I'll never have to pay a cent for it".
In our experience adding value to a property like this has a very marginal impact on rent. Rents are primarily determined by location, number of bedrooms and condition – in that order. Improvements do potentially make the property more attractive, which helps with good occupancy rates in an over-supplied market, but if it has an impact of rent, it's maybe $10 -20pw which would take 4 yrs or more to repay the investment.
As for it increasing the value of the asset – that's an even more marginal assumption. Valuers simply don't drill down to this kind of detail.
Yes it's a 'cost of doing business' – but so are a lot of other things and they all add up. And then you wonder why the damn rent is so high.
I have to eat so therefore like most urban kiwis I have to use the supermarket.
I don't have to own a rental property, although actually I could. I have a choice, like all landlords. I am not aware of anyone who owns a rental property who got their arm twisted to do so…………but if someone knows of examples of this, by all mean let me know.
I am glad the Govt has launched some sort of enquiry into the profits supermarkets make.
I am really sorry I haven't been following your arguements Red.
I have very little if not xero empathy for landlords. I suppose I have a little empathy if there places are trashed.
My empathy lies with the tenants unless they are very bad tenants.
You might be making very little on your property, but you will realize capital gains unless there is a crash. So now might be the time to take the money and run although I am not predicting there will be a crash. When I was a landlord it didn't involve too much work.
I have to eat so therefore like most urban kiwis I have to use the supermarket.
I don't have to own a rental property,
That's comparison just doesn't work – the 'basic need' is not to be in business to provide the housing service, it's the need people have to be housed, like they do to eat. You’ve stacked oranges up against apples there.
My question to you is this – why do you think providing housing for people is an illegitimate business, while providing food for them (for example) is not?
lol Red. No not an accountant. Many years ago when I let our my house my lawyer referred me to an accountant though who gave advice as to how to set up my affairs to pay as little tax as possible. I think accountants are probably reasonably empathic towards property investors.
I didn't say being a landlord was an illegitimate business just one I don't have much empathy for.
I'd like to see the state provide housing and Kiwibuild to help young people get into homes.
If landlords aren't happy campers and are not making enough money then they know what to do. Sell up and let young first home buyers have a better chance of getting a house.
Btw, the $5000 extra I could have earned didn't seem right as I had to do so little to earn it and I worked a 40 hour week to make a living
Sell up and let young first home buyers have a better chance of getting a house.
That would be nice if total supply was keeping up with demand – but it isn't. At present all that would do is drive a shortage of rentals and push up rents even further.
Keep in mind there is always a legitimate demand for rental housing. Roughly 15% of the population will for one reason or another never qualify for a bank mortgage, and another 15 – 20% are at a stage in their lives where they are not interested in or needing to buy a home – regardless of affordability.
At present all that would do is drive a shortage of rentals and push up rents even further.
Why? Does the house stop existing if the rentier sells it? Surely the new owners were living somewhere before they bought that particular house – wouldn't their old home be freed up? Or the old home of the people who bought their old home? Sooner or later a renter will buy some home in the chain…
The only things that lower the rental market are 2nd homes and ghost homes. A beefed up CGT would deal to both – not on Lab6's radar, but sooner or later it'll happen.
Well McF – all the evidence suggests this is exactly what is happening at the moment. As I said – if total supply isn't keeping up with total demand – then everything else is just shuffling deck chairs.
The particular symptom through which the capitalist problem currently manifests itself in the housing market isn't a lack of homes.
It's a surplus of capitalists: ghost homes in Auckland – 39,000 empty dwellings. 200k in NZ overall.
But the odds are still good that a currently-occupied home would get re-occupied after being sold. So no, a sale doesn't destroy a dwelling. What makes a home vacant is a landlord who sees more profit in accruing capital value than in providing a home, and bugger the renting class.
Pretty much by definition if the house is vacant – they're not a landlord. It makes them property speculators first and foremost.
lol now you're doing the No True Scotsman.
They're all capitalists who buy up homes to make money. Whether they rent out those homes or feel sitting on them for the capital gain is better value for their time is moot. As markets change they switch from one to the other. You're just as much a speculator as someone who owns a ghost home.
You're just as much a speculator as someone who owns a ghost home.
Or anyone who owns any asset that increases in value, including ordinary homeowners for that matter.
But I think I'm pretty safe to say that someone who owns a property that they neither live in, nor have tenanted, are first and foremost property speculators.
I think it is a false belief that that way lies riches, which for most it does not. that is based on having done maybe hundreds of financial statements and tax returns as a chartered accountant for landlords.
Which is something the rental business has in common with many other business sectors in NZ – too many are operated for capital gain not cashflow.
What we have here is an awful intersection of this entrenched structural issue, the relatively high capital intensity of the rental business, and high levels of deprivation at the bottom of the income scales.
If we want to fix this chronic problem – we need to look at the real causes. Tinkering with band-aids on symptoms usually only has unintended consequences.
"too many are operated for capital gain not cashflow."
Could you give me an example where the capital gain on a business equals that of a rental property and where similarly tax on the capital gain is not paid?
Residential property is inherently a very capital intensive business, so it's always going to be more susceptible to the impact of capital gain than many others.
Farming would be another obvious example. And many small businesses that depend on property, goodwill, or intellectual stock of some kind will look to capital gain on the hoped for sale of the business to make up for decades of marginal operating profits.
McDonald's is another example that comes to mind – the capital gains many franchisees make on their shop location may well exceed that of the actual food business.
Are rates correlated to the average house price? I don’t think so. For example, if all house prices go up by 10%, the rates will essentially stay the same.
I don't demonize landlords – I just call them silly buggers for borrowing too much, and then acting surprised when they find that interest is gobbling up all their profits. Make interest non deductible and they would then be looking at a much improved bottom line (in bookkeeping terms) and paying a decent amount of tax – even though they would have to pay that tax from their own pockets. Under those circumstances I think that many would be thinking about off-selling their unsound investments.
There are some really great tenants who maintain the property and require a tradesman yearly if that. House prices increasing are the only sure thing for home investors. If you cannot afford the cost of being a landlord don't be one.
If a tenant had a community services card the landlord got a 50% subsidy for insulation.
I do have sympathy for landlords who get the place trashed and ripped off with unpaid rent.
More than 90% of tenants are wonderful and look after their home better than we might even. (Or at least they do on the inside – we always pay to have the sections maintained.)
But all properties need maintenance no matter how well the tenants look after them – lawns mowed, walls and roofs washing, blocked gutters, fences, drains, trees trimming, appliances like stoves, hot water cylinders and heaters break, carpets wear out, windows get broken, door locks and window stays replaced. In the usual course of events we budget for about 6% of the rental income towards R&M over the long term.
I have noticed that less and less landlords maintain the section with the exception of the lawn mowing. I would like to see landlords offer to dump the weeds. Many tenants would do weeding and benefit from the out door exercise.
I lived in a row of 7 flats and I used to weed the whole drive, fence line and door paths, (I did ask permission from any new tenant). I am no longer there but I walk past regularly – it is all over grown now. A looked after drive and section greets you.
The Child Poverty Action Group’s stocktake of progress on the Welfare Expert Advisory Group’s (WEAG) 42 key recommendations has found none of them have been fully implemented.
I know, I read it and if you read the full article there's a contradiction with that statement. For example, indexing benefits to wage growth was a recommendation was it not? that's been implemented and note, the government doesn't agree with all of the recommendations.
The Government set up the Welfare Expert Advisory Group in May 2018 with the explicit purpose to investigate the welfare system. Surely having commissioned the report they are not in the position to disagree with any of the recommendations but simply implement them.
Otherwise what was the point of the group or the report?
ACT bleating again. Seymour seems to want business to have its cake and to eat it too as the MBIE figure only covers one side of the equation. However, if any of the existing holidays are to be done away with, in exchange for Matariki, there are plenty of Christian ones that could go. Would he want to explain his decision to the God Squaders who vote for ACT?
There is no reason why, once the Queen dies, we cannot do away with QB weekend, leaving Matariki as the main public holiday between Easter and Labour weekend.
So many cultures around the world have festivals connected to the summer and winter solstices and the passing of the seasons. Think Stonehenge and the Scandinavian festivals. Matariki marks so much in this regard if we study the history of Polynesian cultures, the significance of the Pleiades etc – and it's distinctly NZ. It's not just about another public holiday.
I wonder if act actually do any real research. long holiday weekends are a real boost to NZ economy. even the moaners who have to pay for a days holiday for their workers do well out of them. economic activity spikes every long weekend, and a mid winter long weekend will be a real economic winner. all to difficult for actoids to understand.
With Boeing having its entire 777 fleet grounded, it's pretty easy to see an increased likelihood of squealing about bankruptcy to get more billions of Federal aid.
I see its only related to P&W Engines only not GE, RR, CFM Engines. It's very rare for an engine explosion like to happen and I think the last one to happen from memory was the Qantas A380 after takeoff from Singers a few yrs back. Old mate flying that A380 was very lucky to get that A380 bird back on the tarmac from all accounts (I haven't read old mates book, but read most of the summaries incl Training & crew management or whatever its called when i was doing training and training development on top of my Operations/ Plans for the RAAF Darwin Sec FLT before i got the boot.
Photo: Lynn Grieveson / The KākāTL;DR: My top six things to note around housing, climate and poverty in Aotearoa’s political economy in the week to July 27 were:1. The Minister for Ford Rangers strikes againTransport Minister Simeon Brown was again the busiest of the Cabinet ministers this week, announcing an ...
You got a fast carAnd I want a ticket to anywhereMaybe we make a dealMaybe together we can get somewhereAny place is betterYesterday’s newsletter, Trust In Me, on the report of abuse in state care, and by religious organisations, between 1950 and 2019, coupled with the hypocrisy of Christopher Luxon ...
New Zealand is again having to reconcile conflicting pressures from its military and its trade interests. Should we join Pillar Two of AUKUS and risk compromising our markets in China? For a century after New Zealand was founded in 1840, its external security arrangements and external economics arrangements were aligned. ...
The ‘50 Shades of Green’ farmers’ protest in 2019 was heavy on climate change denial, but five years on, scepticism and criticism about the idea that pine forests can save us is growing across the board. File photo: Lynn GrievesonTL;DR: Here’s the top six news items of note in climate ...
This morning the sky was bright.The birds, in their usual joyous bliss. Nature doesn’t seem to feel the heat of what might angst humans.Their calls are clear and beautiful.Just some random thoughts:MāoriPaul Goldsmith has announced his government will roll back the judiciary’s rulings on Māori Customary Marine Title, which recognises ...
In 2003, the Court of Appeal delivered its decision in Ngati Apa v Attorney-General, ruling that Māori customary title over the foreshore and seabed had not been universally extinguished, and that the Māori Land Court could determine claims and confirm title if the facts supported it. This kicked off the ...
Earlier this week at Parliament, Labour leader Chris Hipkins was applauded for saying that the response to the final report of the Royal Commission of Inquiry into Abuse in Care had to be “bigger than politics.” True, but the fine words, apologies and “we hear you” messages will soon ring ...
TL;DR: In news breaking this morning:The Ministry of Education is cutting $2 billion from its school building programme so the National-ACT-NZ First Coalition Government has enough money to deliver tax cuts; The Government has quietly lowered its child poverty reduction targets to make them easier to achieve;Te Whatu Ora-Health NZ’s ...
Kia ora. These are some stories that caught our eye this week – as always, feel free to share yours in the comments. Our header image this week (via Eke Panuku) shows the planned upgrade for the Karanga Plaza Tidal Swimming Steps. The week in Greater Auckland On ...
1. What's not to love about the way the Harris campaign is turning things around?a. Nothingb. Love all of itc. God what a reliefd. Not that it will be by any means easye. All of the above 2. Documents released by the Ministry of Health show Associate Health Minister Casey ...
Trust in me in all you doHave the faith I have in youLove will see us through, if only you trust in meWhy don't you, you trust me?In a week that saw the release of the 3,000 page Abuse in Care report Christopher Luxon was being asked about Boot Camps. ...
TL;DR: The podcast above of the weekly ‘hoon’ webinar for paying subscribers last night features co-hosts and talking about the Royal Commission Inquiry into Abuse in Carereport released this week, and with:The Kākā’s climate correspondent on a UN push to not recognise carbon offset markets and ...
TL;DR: As of 6:00 am on Friday, July 26, the top six announcements, speeches, reports and research around housing, climate and poverty in Aotearoa’s political economy in the last day are:Transport: Simeon Brown announced$802.9 million in funding for 18 new trains on the Wairarapa and Manawatū rail lines, which ...
The northern expressway extension from Warkworth to Whangarei is likely to require radical changes to legislation if it is going to be built within the foreseeable future. The Government’s powers to purchase land, the planning process and current restrictions on road tolling are all going to need to be changed ...
Text within this block will maintain its original spacing when publishedFirst they came for the doctors But I was confused by the numbers and costs So I didn't speak up Then they came for our police and nurses And I didn't think we could afford those costs anyway So I ...
Photo by Joshua J. Cotten on UnsplashWe’re back again after our mid-winter break. We’re still with the ‘new’ day of the week (Thursday rather than Friday) when we have our ‘hoon’ webinar with paying subscribers to The Kākā for an hour at 5 pm.Jump on this link on YouTube Livestream ...
Notes: This is a free article. Abuse in Care themes are mentioned. Video is at the bottom.BackgroundYesterday’s report into Abuse in Care revealed that at least 1 in 3 of all who went through state and faith based care were abused - often horrifically. At least, because not all survivors ...
Luxon speaks in Parliament yesterday about the Abuse in Care report. Photo: Hagen Hopkins/Getty ImagesTL;DR: The top six things I’ve noted around housing, climate and poverty in Aotearoa’s political economy today are:PM Christopher Luxon said yesterday in tabling the Abuse in Carereport in Parliament he wanted to ‘do the ...
About a decade ago I worked with a bloke called Steve. He was the grizzled veteran coder, a few years older than me, who knew where the bodies were buried - code wise. Despite his best efforts to be approachable and friendly he could be kind of gruff, through to ...
Some of the recent announcements from the government have reminded us of posts we’ve written in the past. Here’s one from early 2020. There were plenty of reactions to the government’s infrastructure announcement a few weeks ago which saw them fund a bunch of big roading projects. One of ...
TL;DR: My pick of the top six links elsewhere around housing, climate and poverty in Aotearoa’s political economy in the last day or so to 7:00 am on Thursday, July 25 are:News: Why Electric Kiwi is closing to new customers - and why it matters RNZ’s Susan EdmundsScoop: Government drops ...
Hi,I felt a small wet tongue snaking through one of the holes in my Crocs. It explored my big toe, darting down one side, then the other. “He’s looking for some toe cheese,” said the woman next to me, words that still haunt me to this day.Growing up in New ...
Yesterday I happily quoted the Prime Minister without fact-checking him and sure enough, it turns out his numbers were all to hell. It’s not four kg of Royal Commission report, it’s fourteen.My friend and one-time colleague-in-comms Hazel Phillips gently alerted me to my error almost as soon as I’d hit ...
TL;DR: As of 6:00 am on Thursday, July 25, the top six announcements, speeches, reports and research around housing, climate and poverty in Aotearoa’s political economy in the last day were:The Abuse in Care Royal Commission of Inquirypublished its final report yesterday.PM Christopher Luxon and The Minister responsible for ...
The Official Information Act has always been a battle between requesters seeking information, and governments seeking to control it. Information is power, so Ministers and government agencies want to manage what is released and when, for their own convenience, and legality and democracy be damned. Their most recent tactic for ...
TL;DR: The top six things I’ve noted around housing, climate and poverty in Aotearoa’s political economy today are:Transport and Energy Minister Simeon Brown is accelerating plans to spend at least $10 billion through Public Private Partnerships (PPPs) to extend State Highway One as a four-lane ‘Expressway’ from Warkworth to Whangarei ...
I live my life (woo-ooh-ooh)With no control in my destinyYea-yeah, yea-yeah (woo-ooh-ooh)I can bleed when I want to bleedSo come on, come on (woo-ooh-ooh)You can bleed when you want to bleedYea-yeah, come on (woo-ooh-ooh)Everybody bleed when they want to bleedCome on and bleedGovernments face tough challenges. Selling unpopular decisions to ...
Please note:To skip directly to the- parliamentary footage in the video, scroll to 1:21 To skip to audio please click on the headphone iconon the left hand side of the screenThis video / audio section is under development. ...
Given the crackdown on wasteful government spending, it behooves me to point to a high profile example of spending by the Luxon government that looks like a big, fat waste of time and money. I’m talking about the deployment of NZDF personnel to support the US-led coalition in the Red ...
TL;DR: My pick of the top six links elsewhere around housing, climate and poverty in Aotearoa’s political economy in the last day or so to 7:40 am on Wednesday, July 24 are:Deep Dive: Chipping away at the housing crisis, including my comments RNZ/Newsroom’s The DetailNews: Government softens on asset sales, ...
As I reported about the city centre, Auckland’s rail network is also going through a difficult and disruptive period which is rapidly approaching a culmination, this will result in a significant upgrade to the whole network. Hallelujah. Also like the city centre this is an upgrade predicated on the City ...
Today, a 4 kilogram report will be delivered to Parliament. We know this is what the report of the Royal Commission of Inquiry into Abuse in State and Faith-based Care weighs, because our Prime Minister told us so.Some reporter had blindsided him by asking a question about something done by ...
TL;DR: As of 7:00 am on Wednesday, July 24, the top six announcements, speeches, reports and research around housing, climate and poverty in Aotearoa’s political economy in the last day are:Beehive:Transport Minister Simeon Brownannounced plans to use PPPs to fund, build and run a four-lane expressway between Auckland ...
NewstalkZB host Mike Hosking, who can usually be relied on to give Prime Minister Christopher Luxon an easy run, did not do so yesterday when he interviewed him about the HealthNZ deficit. Luxon is trying to use a deficit reported last year by HealthNZ as yet another example of the ...
Back in January a StatsNZ employee gave a speech at Rātana on behalf of tangata whenua in which he insulted and criticised the government. The speech clearly violated the principle of a neutral public service, and StatsNZ started an investigation. Part of that was getting an external consultant to examine ...
Renting for life: Shared ownership initiatives are unlikely to slow the slide in home ownership by much. Photo: Lynn Grieveson / The KākāTL;DR: The top six things I’ve noted around housing, climate and poverty in Aotearoa’s political economy today are:A Deloittereport for Westpac has projected Aotearoa’s home-ownership rate will ...
You're broken down and tiredOf living life on a merry go roundAnd you can't find the fighterBut I see it in you so we gonna walk it outAnd move mountainsWe gonna walk it outAnd move mountainsAnd I'll rise upI'll rise like the dayI'll rise upI'll rise unafraidI'll rise upAnd I'll ...
There’s been a change in Myers Park. Down the steps from St. Kevin’s Arcade, past the grassy slopes, the children’s playground, the benches and that goat statue, there has been a transformation. The underpass for Mayoral Drive has gone from a barren, grey, concrete tunnel, to a place that thrums ...
This is a re-post from Yale Climate Connections Global society may have finally slammed on the brakes for climate-warming pollution released by human fossil fuel combustion. According to the Carbon Monitor Project, the total global climate pollution released between February and May 2024 declined slightly from the amount released during the same ...
TL;DR: My pick of the top six links elsewhere around housing, climate and poverty in Aotearoa’s political economy in the last day or so to 7:00 am on Tuesday, July 23 are:Deep Dive: Penlink: where tolling rhetoric meets reality BusinessDesk-$$$’sOliver LewisScoop:Te Pūkenga plans for regional polytechs leak out ...
TL;DR: As of 6:00 am on Tuesday, July 23, the top six announcements, speeches, reports and research around housing, climate and poverty in Aotearoa’s political economy in the last day are:Health: Shane Reti announcedthe Board of Te Whatu Ora-Health New Zealand was being replaced with Commissioner Lester Levy ...
Health NZ warned the Government at the end of March that it was running over Budget. But the reasons it gave were very different to those offered by the Prime Minister yesterday. Prime Minister Christopher Luxon blamed the “botched merger” of the 20 District Health Boards (DHBs) to create Health ...
Long ReadKey Summary: Although National increased the health budget by $1.4 billion in May, they used an old funding model to project health system costs, and never bothered to update their pre-election numbers. They were told during the Health Select Committees earlier in the year their budget amount was deficient, ...
As a momentous, historic weekend in US politics unfolded, analysts and commentators grasped for precedents and comparisons to help explain the significance and power of the choice Joe Biden had made. The 46th president had swept the Democratic party’s primaries but just over 100 days from the election had chosen ...
TL;DR: I’m casting around for new ideas and ways of thinking about Aotearoa’s political economy to find a few solutions to our cascading and self-reinforcing housing, poverty and climate crises.Associate Professor runs an online masters degree in the economics of sustainability at Torrens University in Australia and is organising ...
The Finance and Expenditure Committee has reported back on National's Local Government (Water Services Preliminary Arrangements) Bill. The bill sets up water for privatisation, and was introduced under urgency, then rammed through select committee with no time even for local councils to make a proper submission. Naturally, national's select committee ...
Some years ago, I bought a book at Dunedin’s Regent Booksale for $1.50. As one does. Vandrad the Viking (1898), by J. Storer Clouston, is an obscure book these days – I cannot find a proper online review – but soon it was sitting on my shelf, gathering dust alongside ...
History is not on the side of the centre-left, when Democratic presidents fall behind in the polls and choose not to run for re-election. On both previous occasions in the past 75 years (Harry Truman in 1952, Lyndon Johnson in 1968) the Democrats proceeded to then lose the White House ...
This is a free articleCoverageThis morning, US President Joe Biden announced his withdrawal from the Presidential race. And that is genuinely newsworthy. Thanks for your service, President Biden, and all the best to you and yours.However, the media in New Zealand, particularly the 1News nightly bulletin, has been breathlessly covering ...
A homeless person’s camp beside a blocked-off slipped damage walkway in Freeman’s Bay: we are chasing our tail on our worsening and inter-related housing, poverty and climate crises. Photo: Photo: Lynn Grieveson / The KākāTL;DR: The top six things I’ve noted around housing, climate and poverty in Aotearoa’s political economy ...
What has happened to it all?Crazy, some'd sayWhere is the life that I recognise?(Gone away)But I won't cry for yesterdayThere's an ordinary worldSomehow I have to findAnd as I try to make my wayTo the ordinary worldYesterday morning began as many others - what to write about today? I began ...
TL;DR: My pick of the top six links elsewhere around housing, climate and poverty in Aotearoa’s political economy in the last day or so to 7:00 am on Monday, July 22 are:Today’s Must Read: Father and son live in a tent, and have done for four years, in a million ...
TL;DR: As of 7:00 am on Monday, July 22, the top six announcements, speeches, reports and research around housing, climate and poverty in Aotearoa’s political economy in the last day are:US President Joe Biden announced via X this morning he would not stand for a second term.Multinational professional services firm ...
A listing of 32 news and opinion articles we found interesting and shared on social media during the past week: Sun, July 14, 2024 thru Sat, July 20, 2024. Story of the week As reflected by preponderance of coverage, our Story of the Week is Project 2025. Until now traveling ...
This weekend, a friend pointed out someone who said they’d like to read my posts, but didn’t want to pay. And my first reaction was sympathy.I’ve already told folks that if they can’t comfortably subscribe, and would like to read, I’d be happy to offer free subscriptions. I don’t want ...
National: The Party of ‘Law and Order’ IntroductionThis weekend, the Government formally kicked off one of their flagship policy programs: a military style boot camp that New Zealand has experimented with over the past 50 years. Cartoon credit: Guy BodyIt’s very popular with the National Party’s Law and Orderimage, ...
Day one of the solo leg of my long journey home begins with my favourite sound: footfalls in an empty street. 5.00 am and it’s already light and already too warm, almost.If I can make the train that leaves Budapest later this hour I could be in Belgrade by nightfall; ...
Do you remember Y2K, the threat that hung over humanity in the closing days of the twentieth century? Horror scenarios of planes falling from the sky, electronic payments failing and ATMs refusing to dispense cash. As for your VCR following instructions and recording your favourite show - forget about it.All ...
Climate Change Minister Simon Watts being questioned by The Kākā’s Bernard Hickey.TL;DR: My top six things to note around housing, climate and poverty in Aotearoa’s political economy in the week to July 20 were:1. A strategy that fails Zero Carbon Act & Paris targetsThe National-ACT-NZ First Coalition Government finally unveiled ...
Summary:As New Zealand loses at least 12 leaders in the public service space of health, climate, and pharmaceuticals, this month alone, directly in response to the Government’s policies and budget choices, what lies ahead may be darker than it appears. Tui examines some of those departures and draws a long ...
The Minister of Housing’s ambition is to reduce markedly the ratio of house prices to household incomes. If his strategy works it would transform the housing market, dramatically changing the prospects of housing as an investment.Leaving aside the Minister’s metaphor of ‘flooding the market’ I do not see how the ...
As previously noted, my historical fantasy piece, set in the fifth-century Mediterranean, was accepted for a Pirate Horror anthology, only for the anthology to later fall through. But in a good bit of news, it turned out that the story could indeed be re-marketed as sword and sorcery. As of ...
An employee of tobacco company Philip Morris International demonstrates a heated tobacco device. Photo: Getty ImagesTL;DR: The top six things I’ve noted around housing, climate and poverty in Aotearoa’s political economy on Friday, July 19 are:At a time when the Coalition Government is cutting spending on health, infrastructure, education, housing ...
TL;DR: My pick of the top six links elsewhere around housing, climate and poverty in Aotearoa’s political economy in the last day or so to 8:30 am on Friday, July 19 are:Scoop: NZ First Minister Casey Costello orders 50% cut to excise tax on heated tobacco products. The minister has ...
Kia ora, it’s time for another Friday roundup, in which we pull together some of the links and stories that caught our eye this week. Feel free to add more in the comments! Our header image this week shows a foggy day in Auckland town, captured by Patrick Reynolds. ...
TL;DR : Here’s the top six items climate news for Aotearoa this week, as selected by Bernard Hickey and The Kākā’s climate correspondent Cathrine Dyer. A discussion recorded yesterday is in the video above and the audio of that sent onto the podcast feed.The Government released its draft Emissions Reduction ...
Save some money, get rich and old, bring it back to Tobacco Road.Bring that dynamite and a crane, blow it up, start all over again.Roll up. Roll up. Or tailor made, if you prefer...Whether you’re selling ciggies, digging for gold, catching dolphins in your nets, or encouraging folks to flutter ...
Waiting In The Wings:For truly, if Trump is America’s un-assassinated Caesar, then J.D. Vance is America’s Octavian, the Republic’s youthful undertaker – and its first Emperor.DONALD TRUMP’S SELECTION of James D. Vance as his running-mate bodes ill for the American republic. A fervent supporter of Viktor Orban, the “illiberal” prime ...
TL;DR: As of 6:00 am on Friday, July 19, the top six announcements, speeches, reports and research around housing, climate and poverty in Aotearoa’s political economy in the last day are:The PSAannounced the Employment Relations Authority (ERA) had ruled in the PSA’s favour in its case against the Ministry ...
Te Rangi e tu nei (The sky above us) Te Papa e takoto nei (The land beneath us) Tatou katoa te hunga ora (To us all the living) Tena koutou katoa (Greetings) ...
A late change to charter school legislation will cheat educators out of fair pay and negotiating power proving charter schools are just a vehicle to make profit out of our education system. ...
In 2004 te iwi Māori rallied against the Crown’s attempt to confiscate our coastlines and moana with the Foreshore and Seabed Act. This led to the largest hīkoi of a generation and the birth of Te Pāti Māori. 20 years later, history is repeating itself. Today the government has announced ...
It has been five and a half years since the Royal Commission of Inquiry into Abuse in Care was established to investigate the abuse of children, young people, and vulnerable adults within state and faith-based institutions. Yesterday, the final report - Whanaketia through pain and trauma, from darkness to light ...
The Green Party is calling on the Government to take action off the back of the International Court of Justice ruling on Israel’s illegal occupation of Palestine. ...
On Friday the International Court of Justice reaffirmed what Palestinian’s have been telling us for decades: that the occupation and colonisation of Palestinian lands by Israel is illegal and must end immediately. They also called for reparations for Palestinian’s who have lived under Israeli occupation since it began in 1967. ...
Labour calls on the Government to act after the International Court of Justice (ICJ) ruled that Israel’s occupation of Palestinian Territories is illegal. ...
The 53.7 percent rise in benefit sanctions over the last year is more proof of this Government’s disdain for our communities most in need of support. ...
Aotearoa could be a country where every child grows up feeling safe, loved and with a sense of belonging in their whānau and community. But for some of our children, this is far from reality. Instead, they are trapped in a maze of intergenerational harm that they can’t escape on ...
Te Pāti Māori are calling for David Seymour to resign as Associate Health Minister in response to his call for Pharmac to ignore the Treaty of Waitangi. “This announcement is just another example of the government’s anti-Tiriti, anti-Māori agenda.” Said Co-leader and spokesperson for health, Debbie Ngarewa-Packer. “Seymour thinks it ...
The soaring price of renting is driving the rise of inflation in this country - with latest figures from Stats NZ showing rents are up 4.8 per cent on average while annual inflation is at 3.3 per cent. ...
National’s Emissions Reduction Plan will take New Zealand further from the economy we need to ensure the next generation has a stable climate and secure livelihoods. ...
Following consultation with named parties and thorough consideration of privacy interests, the Green Party is in a position to release the Executive Summary of the final report from the independent investigation into Darleen Tana. ...
Prime Minister Christopher Luxon should be asking serious questions of his Minister for Resources Shane Jones now it’s been revealed he misled the public about a dinner with mining companies that he didn’t declare and said wasn’t pre-arranged. ...
Te Pāti Māori have submitted to the Justice Select Committee against the Sentencing (Reinstating Three Strikes) Amendment Bill. The bill will further entrench racism in our justice system and fails to focus on rehabilitation. “Reinstating Three Strikes will empower a systematically racist system and exacerbate the overrepresentation of Māori in ...
The Transport and Infrastructure Committee is set to make a determination on the Residential Tenancies Amendment (RTA) Bill in the coming weeks. “This legislation will give landlords the power to kick our whānau out onto the street for no reason” said Housing spokesperson, Mariameno Kapa-Kingi. “Their solution to the housing ...
“National’s campaign was about tackling crime and the best they can do is a two-year long Ministerial Advisory Group,” Labour justice spokesperson Duncan Webb said. ...
“There are more examples of charter schools failing their students than there are success stories. The coalition Government is driving to dismantle our public school system and instead promote a privatised, competitive structure that puts profits before kids,” Jan Tinetti said. ...
“This government is choosing to deliberately mislead and withhold information, keeping our people in the dark about this government’s agenda and the future of our mokopuna,” said co-leader and spokesperson for Health, Debbie Ngarewa-Packer. The call comes after the demand from the Chief Ombudsman that Associate Minister of Health, Casey ...
“Today’s climate announcement by Simon Watts makes clear the National Government is simply paying lip service to meeting its climate change targets,” Megan Woods said. ...
National is choosing to make life harder for workers by taking away the rights our communities have fought hard for. Here's how they’re taking workers backwards. ...
Australia, Canada and New Zealand today issued the following statement on the need for an urgent ceasefire in Gaza and the risk of expanded conflict between Hizballah and Israel. The situation in Gaza is catastrophic. The human suffering is unacceptable. It cannot continue. We remain unequivocal in our condemnation of ...
Attorney-General Judith Collins today reminded all State and faith-based institutions of their legal obligation to preserve records relevant to the safety and wellbeing of those in its care. “The Abuse in Care Inquiry’s report has found cases where records of the most vulnerable people in State and faith‑based institutions were ...
Minister of Internal Affairs Brooke van Velden says the Government’s online safety website for children and young people has reached one million page views. “It is great to see so many young people and their families accessing the site Keep It Real Online to learn how to stay safe online, and manage ...
Tēnā tātou katoa, Ngā mihi te rangi, ngā mihi te whenua, ngā mihi ki a koutou, kia ora mai koutou. Thank you for the opportunity to be here and the invitation to speak at this 50th anniversary conference. I acknowledge all those who have gone before us and paved the ...
New Zealand’s payroll providers have successfully prepared to ensure 3.5 million individuals will, from Wednesday next week, be able to keep more of what they earn each pay, says Finance Minister Nicola Willis and Revenue Minister Simon Watts. “The Government's tax policy changes are legally effective from Wednesday. Delivering this tax ...
An experimental vineyard which will help futureproof the wine sector has been opened in Blenheim by Associate Regional Development Minister Mark Patterson. The covered vineyard, based at the New Zealand Wine Centre – Te Pokapū Wāina o Aotearoa, enables controlled environmental conditions. “The research that will be produced at the Experimental ...
The Coalition Government has confirmed the indicative regional breakdown of North Island Weather Event (NIWE) funding for state highway recovery projects funded through Budget 2024, Transport Minister Simeon Brown says. “Regions in the North Island suffered extensive and devastating damage from Cyclone Gabrielle and the 2023 Auckland Anniversary Floods, and ...
Indonesia’s Foreign Minister, Retno Marsudi, will visit New Zealand next week, Foreign Minister Winston Peters has announced. “Indonesia is important to New Zealand’s security and economic interests and is our closest South East Asian neighbour,” says Mr Peters, who is currently in Laos to engage with South East Asian partners. ...
He aha te kai a te rangatira? He kōrero, he kōrero, he kōrero. The government has reaffirmed its commitment to supporting the aspirations of Ngāti Maniapoto, Minister for Māori Development Tama Potaka says. “My thanks to Te Nehenehenui Trust – Ngāti Maniapoto for bringing their important kōrero to a ministerial ...
Transport Minister Simeon Brown has thanked outgoing Chair of the Civil Aviation Authority, Janice Fredric, for her service to the board.“I have received Ms Fredric’s resignation from the role of Chair of the Civil Aviation Authority,” Mr Brown says.“On behalf of the Government, I want to thank Ms Fredric for ...
The Government is proposing legislation to overturn a Court of Appeal decision and amend the Marine and Coastal Area Act in order to restore Parliament’s test for Customary Marine Title, Treaty Negotiations Minister Paul Goldsmith says. “Section 58 required an applicant group to prove they have exclusively used and occupied ...
Regulation Minister David Seymour says that opposition parties have united in bad faith, opposing what they claim are ‘dangerous changes’ to the Early Childhood Education sector, despite no changes even being proposed yet. “Issues with affordability and availability of early childhood education, and the complexity of its regulation, has led ...
After receiving more than 740 submissions in the first 20 days, Regulation Minister David Seymour is asking the Ministry for Regulation to extend engagement on the early childhood education regulation review by an extra two weeks. “The level of interest has been very high, and from the conversations I’ve been ...
The Coalition Government is investing $802.9 million into the Wairarapa and Manawatū rail lines as part of a funding agreement with the NZ Transport Agency (NZTA), KiwiRail, and the Greater Wellington and Horizons Regional Councils to deliver more reliable services for commuters in the lower North Island, Transport Minister Simeon ...
Local Government Minister Simeon Brown has announced his intention to appoint a Crown Manager to both Hawke’s Bay Regional and Wairoa District Councils to speed up the delivery of flood protection work in Wairoa."Recent severe weather events in Wairoa this year, combined with damage from Cyclone Gabrielle in 2023 have ...
Mr Speaker, this is a day that many New Zealanders who were abused in State care never thought would come. It’s the day that this Parliament accepts, with deep sorrow and regret, the Report of the Royal Commission of Inquiry into Abuse in Care. At the heart of this report are the ...
For the first time, the Government is formally acknowledging some children and young people at Lake Alice Psychiatric Hospital experienced torture. The final report of the Royal Commission of Inquiry into Abuse in State and Faith-based Care “Whanaketia – through pain and trauma, from darkness to light,” was tabled in Parliament ...
The Government has acknowledged the nearly 2,400 courageous survivors who shared their experiences during the Royal Commission of Inquiry into Historical Abuse in State and Faith-Based Care. The final report from the largest and most complex public inquiry ever held in New Zealand, the Royal Commission Inquiry “Whanaketia – through ...
With a week to go before hard-working New Zealanders see personal income tax relief for the first time in fourteen years, 513,000 people have used the Budget tax calculator to see how much they will benefit, says Finance Minister Nicola Willis. “Tax relief is long overdue. From next Wednesday, personal income ...
Workplace Relations and Safety Minister Brooke van Velden says a bill that has passed its first reading will improve parental leave settings and give non-biological parents more flexibility as primary carer for their child. The Regulatory Systems Amendment Bill (No3), passed its first reading this morning. “It includes a change ...
Two Bills designed to improve regulation and make it easier to do business have passed their first reading in Parliament, says Economic Development Minister Melissa Lee. The Regulatory Systems (Economic Development) Amendment Bill and Regulatory Systems (Immigration and Workforce) Amendment Bill make key changes to legislation administered by the Ministry ...
New legislation paves the way for greater competition in sectors such as banking and electricity, Commerce and Consumer Affairs Minister Andrew Bayly says. “Competitive markets boost productivity, create employment opportunities and lift living standards. To support competition, we need good quality regulation but, unfortunately, a recent OECD report ranked New ...
Minister of Internal Affairs Brooke van Velden says lotteries for charitable purposes, such as those run by the Heart Foundation, Coastguard NZ, and local hospices, will soon be allowed to operate online permanently. “Under current laws, these fundraising lotteries are only allowed to operate online until October 2024, after which ...
The Coalition Government is accelerating work on the new four-lane expressway between Auckland and Whangārei as part of its Roads of National Significance programme, with an accelerated delivery model to deliver this project faster and more efficiently, Transport Minister Simeon Brown says. “For too long, the lack of resilient transport connections ...
Sir Don McKinnon will travel to Viet Nam this week as a Special Envoy of the Government, Foreign Minister Winston Peters has announced. “It is important that the Government give due recognition to the significant contributions that General Secretary Nguyen Phu Trong made to New Zealand-Viet Nam relations,” Mr ...
Minister of Internal Affairs Brooke van Velden says newly appointed Commissioner, Grant Illingworth KC, will help deliver the report for the first phase of the Royal Commission of Inquiry into COVID-19 Lessons, due on 28 November 2024. “I am pleased to announce that Mr Illingworth will commence his appointment as ...
Foreign Minister Winston Peters travels to Laos this week to participate in a series of Association of Southeast Asian Nations (ASEAN)-led Ministerial meetings in Vientiane. “ASEAN plays an important role in supporting a peaceful, stable and prosperous Indo-Pacific,” Mr Peters says. “This will be our third visit to ...
Construction of a new mental health facility at Te Nikau Grey Hospital in Greymouth is today one step closer, Mental Health Minister Matt Doocey says. “This $27 million facility shows this Government is delivering on its promise to boost mental health care and improve front line services,” Mr Doocey says. ...
New Zealand is committing nearly $50 million to a package supporting sustainable Pacific fisheries development over the next four years, Foreign Minister Winston Peters and Oceans and Fisheries Minister Shane Jones announced today. “This support consisting of a range of initiatives demonstrates New Zealand’s commitment to assisting our Pacific partners ...
Associate Education Minister David Seymour says proposed changes to the Education and Training Amendment Bill will ensure charter schools have more flexibility to negotiate employment agreements and are equipped with the right teaching resources. “Cabinet has agreed to progress an amendment which means unions will not be able to initiate ...
In response to serious concerns around oversight, overspend and a significant deterioration in financial outlook, the Board of Health New Zealand will be replaced with a Commissioner, Health Minister Dr Shane Reti announced today. “The previous government’s botched health reforms have created significant financial challenges at Health NZ that, without ...
Minister for Space and Science, Innovation and Technology Judith Collins will travel to Adelaide tomorrow for space and science engagements, including speaking at the Australian Space Forum. While there she will also have meetings and visits with a focus on space, biotechnology and innovation. “New Zealand has a thriving space ...
Climate Change Minister Simon Watts will travel to China on Saturday to attend the Ministerial on Climate Action meeting held in Wuhan. “Attending the Ministerial on Climate Action is an opportunity to advocate for New Zealand climate priorities and engage with our key partners on climate action,” Mr Watts says. ...
Oceans and Fisheries Minister Shane Jones is travelling to the Solomon Islands tomorrow for meetings with his counterparts from around the Pacific supporting collective management of the region’s fisheries. The 23rd Pacific Islands Forum Fisheries Committee and the 5th Regional Fisheries Ministers’ Meeting in Honiara from 23 to 26 July ...
The Government today launched the Military Style Academy Pilot at Te Au rere a te Tonga Youth Justice residence in Palmerston North, an important part of the Government’s plan to crackdown on youth crime and getting youth offenders back on track, Minister for Children, Karen Chhour said today. “On the ...
The Government has welcomed news the NZ Transport Agency (NZTA) has begun work to replace nine priority bridges across the country to ensure our state highway network remains resilient, reliable, and efficient for road users, Transport Minister Simeon Brown says.“Increasing productivity and economic growth is a key priority for the ...
Acting Prime Minister David Seymour has been in contact throughout the evening with senior officials who have coordinated a whole of government response to the global IT outage and can provide an update. The Department of the Prime Minister and Cabinet has designated the National Emergency Management Agency as the ...
New Zealand and Japan will continue to step up their shared engagement with the Pacific, Foreign Minister Winston Peters says. “New Zealand and Japan have a strong, shared interest in a free, open and stable Pacific Islands region,” Mr Peters says. “We are pleased to be finding more ways ...
New developments in the heart of North Island forestry country will reinvigorate their communities and boost economic development, Regional Development Minister Shane Jones says. Mr Jones visited Kaingaroa and Kawerau in Bay of Plenty today to open a landmark community centre in the former and a new connecting road in ...
President Adeang, fellow Ministers, honourable Diet Member Horii, Ambassadors, distinguished guests. Minasama, konnichiwa, and good afternoon, everyone. Distinguished guests, it’s a pleasure to be here with you today to talk about New Zealand’s foreign policy reset, the reasons for it, the values that underpin it, and how it ...
Last summer when Matairangi burned, Ginny and Tom stood at the window of their lounge, watching kākā shoot skyward from the burning trees. From the distance, they looked to Ginny like pages torn from books and thrown into a bonfire. It was Tom, voice tight, who told her it was ...
Opinion: The Canadian short story writer Alice Munro – winner of the Nobel Prize in Literature in 2013 – died in May at the age of 92. Her work was about “the damage people inflict on one another in the name of love”, Deborah Treisman wrote in the New Yorker. ...
This month marks two years since the most powerful telescope ever built sent its first pictures back to earth. From its lofty vantage point, beyond the moon in orbit around the sun, the James Webb Space Telescope was tuned to observe the first stars and galaxies being born soon after ...
Comment: After Climate Change Minister Simon Watts’ preview several weeks ago, I had some optimism about the Government’s emissions reduction plan. Now I’ve read the discussion document, that hope has been dashed. How can the Government propose a plan that wants to take New Zealand taxpayers’ hard-earned money, and spend ...
Christopher Luxon: hurdles The little man from National jumps hurdles in his sleep. He’s quite good at it in his dreams and even though the reality doesn’t quite match up you have to give him credit for getting up every morning and crashing into the very first hurdle of the ...
Comment: It was a good two hours into the conversation when Tyrone Marks raised the most basic of questions when I first spoke to him in 2017. “They didn’t explain the things they did to me. They never told me why. And they still haven’t. There’s no explanation for it. ...
Madeleine Chapman rounds out Death Week on The Spinoff with a final recommendation. You can read all of our Death Week coverage here. Nothing forces you to reflect on your life and relationships quite like proximity to death. For those whose nearest and dearest have died, there are reasonably obvious ...
Whitney Greene takes us through her life in television, including the TV character she’d like to plan a funeral for and her cow lung catastrophe on The Traitors NZ. “If the phone rings, I have to answer it,” Whitney Greene from The Traitors NZ warns as we begin our My ...
Maddie Ballard reviews the debut essay collection of Pōneke writer Flora Feltham.In ‘The Raw Material’, the longest essay in Flora Feltham’s dazzling debut collection, the author heads out for a run after hours of weaving and sees the world turn to textile. “Pounding along the Parade, I saw the ...
Andy Christiansen, one half of the experimental rock-pop duo TRiPS, shares the tunes inspiring the band’s perfect weekend and new release. “Good speakers, good food, good music, no distractions”: that’s all you need to enjoy the psychedelic stylings of TRiPS, a new band formed by Fly My Pretties’ Barnaby Weir ...
Celebrating our quadrennial opportunity to become experts in a bunch of sports we never normally watch.The games of the XXXIII Olympiad are upon us. Paris will host this year’s showcase of sporting and athletic prowess, which means some late-night and early-morning viewing for us in Aotearoa.But what sports ...
The photograph is striking and beautiful, but also disturbing – a reminder that my love for John was often entangled in shame.The Sunday Essay is made possible thanks to the support of Creative New Zealand.In the spring of 1980, in Dunedin, shortly before his death, someone took a photograph ...
Get to know Babushka, our latest Dog of the Month. This feature was offered as a reward during our What’s Eating Aotearoa PledgeMe campaign. Thank you to Babu’s humans, Jo and Isabel, for their support. Dog name: Babushka (Babu for short) Age: 2Breed: Border Collie X poodleIf rescued, ...
Pacific Media Watch A Lebanese photojournalist who was severely wounded during an Israeli air strike in south Lebanon carried the Olympic torch in Paris this week in honour of her peers who have been wounded and killed in the field — especially in Gaza and Lebanon. Christina Assi of Agence ...
The first report in a five-part web series focused on the 15th Triennial Conference of Pacific Women taking place in the Marshall Islands this week.SPECIAL REPORT:By Netani Rika in Majuro Women continue to fight for justice 70 years after the first nuclear tests by the United States caused ...
Christopher Luxon has joined with Australia and Canada's leaders in voicing support for US President Joe Biden's ceasefire deal between Israel and Hamas. ...
Source: The Conversation (Au and NZ) – By Michelle Grattan, Professorial Fellow, University of Canberra The 2022 election brought the “teal wave” into parliament. The next election will test whether teals, who occupy what were Liberal seats, and other independents can maintain their momentum. Joining us on the Podcast ...
Source: The Conversation (Au and NZ) – By Ian Musgrave, Senior lecturer in Pharmacology, University of Adelaide Pixavri/Shutterstock A major Federal Court class action has been dismissed this week after Justice Michael Lee ruled there was not enough evidence to prove the weedkiller Roundup causes cancer. Plaintiff Kelvin ...
In The Week in Politics: politicians have to decide what to do about child abuse, Health NZ is booked in for major surgery and Darleen Tana returns. ...
Source: The Conversation (Au and NZ) – By Clare Corbould, Associate Professor, Contemporary Histories Research Group, Deakin University Mainstream media are surprisingly muted at the prospect of the world’s most powerful nation being led for the first time by a woman – specifically a woman of colour, Vice President Kamala ...
Source: The Conversation (Au and NZ) – By Rebecca Bennett, PhD Student, Associate Research Fellow, Deakin University Last week, a drone delivery company called Wing (owned by Google’s parent company, Alphabet) started operating in Melbourne. Some 250,000 residents in parts of the city’s eastern suburbs can now order food from ...
Source: The Conversation (Au and NZ) – By Jonathan Foo, Lecturer, Physiotherapy, Monash University pikselstock/Shutterstock In the next 40 years in Australia, it’s predicted the number of Australians aged 65 and over will more than double, while the number of people aged 85 and over will more than triple. ...
Source: The Conversation (Au and NZ) – By Katrina Grant, Research Associate, Power Institute for Arts and Visual Culture, University of Sydney Jonas Åkerström’s 1790 work, Session of the Accademia dell’Arcadia on August 17 1788.Nationalmuseum/Cecilia Heisser Ever wondered whether you’d have a better chance at winning an Olympic gold ...
Source: The Conversation (Au and NZ) – By Alexandra Jones, Program Lead, Food Governance, George Institute for Global Health wavebreakmedia/Shutterstock On Thursday, Australian and New Zealand food ministers at state, federal and national levels met to thrash out what’s next for health star ratings on packaged foods. Now, after ...
The Abuse in Care report found many Pacific survivors lost their connections to their culture and language, resulting in trauma that has been carried from generation to generation. ...
In the regulatory review, ECC intends to suggest that ERO focus on curriculum delivery reviews rather than the Ministry, because it’s not efficient or effective to have two agencies with radically different approaches climbing over each other. ...
Te Rūnanga Nui o Ngā Kura Kaupapa Māori invites the current government to work in partnership with them to develop a pathway forward, including the development of a parallel pathway and meaningful policy and strategy for Kura Kaupapa Māori ...
If you haven’t started watching yet, Tara Ward begs you to reconsider. This is an excerpt from our weekly pop culture newsletter Rec Room. Sign up here. In the world of New Zealand reality television, we have many gems in our crown. There’s the delicious second season of the Celebrity Treasure ...
A new poem by Fiona Kidman. The clothes of the dead I did not keep my mother’s furry red beret for long nor the stringy scarves that adorned the necks of my aunts, although I have kept tag ends of gold, the rings and trinkets they wore, the brooches no ...
The government’s announcement that it will re-open the foreshore and seabed controversy by changing the rules on recognising centuries-old Māori customary title for a third time goes against the rule of law and New Zealand values,” Mr Tipa says. ...
The only published and available best-selling indie book chart in New Zealand is the top 10 sales list recorded every week at Unity Books’ stores in High St, Auckland, and Willis St, Wellington.AUCKLAND1 Lioness by Emily Perkins (Bloomsbury, $25) Roarrrr! Perkins’ brilliant, award-winning, Marian-Keyes anointed, darkly funny, long ...
The 2004 Act vested ownership of the foreshore and seabed in the Crown, extinguishing any Māori claims to ownership and causing widespread outrage and protests among Māori communities. ...
Source: The Conversation (Au and NZ) – By Antje Deckert, Associate Professor (Criminology), Auckland University of Technology Getty Images Despite the connection between institutional harm and gang membership made clear in this week’s mammoth royal commission abuse-in care report, the government seems unlikely to soften its “get tough on ...
From Lewis Clareburt in the swimming to the start of the rowing – the first seven days of Paris 2024 promise to be big for New Zealand. There are few events that bring the country together quite like an Olympic Games. Nothing quite matches the excitement of getting up in ...
Groundbreaking local science just showed up in the most surprising of places: the season finale of The Kardashians. In the season five finale of The Kardashians last night, several members of the family gathered together in one of their signature empty, cream-coloured rooms to hear test results that had been ...
Source: The Conversation (Au and NZ) – By Amin Saikal, Emeritus professor of Middle Eastern and Central Asian Studies, Australian National University The Middle East is on the brink of a possibly devastating regional war, with hostilities between Israel and Hezbollah reaching an extremely dangerous level. Washington has engaged in ...
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A law firm that specialises in working with survivors of abuse in State care is disappointed that the Government fails to recognise that its boot camps can be directly compared to previous boot camps from the 1990s and 2000s. ...
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https://www.stuff.co.nz/national/health/coronavirus/300235706/covid19-no-reason-auckland-shouldnt-move-to-alert-level-1-on-monday
I disagree. The advantage of the current system is its simplicity and familiarity. In addition, regional rather than blanket changes in alert levels allows for a more focussed use of the currently available tools.
We all owe him so much for the Covid modelling work that persuaded our government to switch to an elimination goal, but Wilson is not a comms expert.
Precisely! A few experts are starting to stray into areas where they trample around like an elephant in a China shop.
You couldn't possibly be thinking of Des Gorman by any chance?
I certainly think of Des Gorman every time.
yes, whenever I see a headline like " expert claims this" I think of a lazy journo, ringing up someone, looking for an easy column filler. If you got all of the "experts', and all of the economists in one room, apart from hot air, I dont think anything else useful would come out.
yes – nuance is good, but alert levels are aimed at the lowest common denominator.
Yes, that’s us here![wink wink](https://cdn.ckeditor.com/4.11.3/full-all/plugins/smiley/images/wink_smile.png)
Good to see 7 out of 10 kiwis saying benefit levels for both waged and unwaged are too low.
https://www.nzherald.co.nz/nz/survey-finds-support-for-increasing-income-for-low-or-non-waged/YQRTL5WGZPR2HBCHRL32QNVOJU/
It 's a UMR polls commissioned by more than 40 organisations including unions, iwi groups and poverty-focused organisations.
Surely Ardern must be running out of excuses by now.
As soon as this pandemic is over and burgeoning Government debt is under control we’ll get moving again. Ardern and Robertson’s hands are
tighttied."As soon as this pandemic is over and burgeoning Government debt is under control we’ll get moving again. Ardern and Robertson’s hands are
tighttied."That could be a long long long time away.
But what about the vaccines?
I hope you are right and the vaccines (once administered) make a huge difference. But I have doubts that they will. Will we be able to travel overseas once vaccinated without isolating when returning? Hopefully the answer will be yes once enough of the population has had the vaccine. And will we be able to have tourists again (if they are vaccinated).
I'm pretty sure Clark meant to put benefits up too – but somehow she never got around to it. While the "hands are tied" is considered an excuse, it will never happen.
Isn't debt now predicted to be $3.5b lower than forecast and budgeted for already?
https://www.nzherald.co.nz/business/stronger-than-expected-tax-take-sees-smaller-than-forecast-deficit-for-start-of-the-year/X3KTV4O73DA4OTQISATLSS45HA/
Those ties look pretty loose to me.
If I had $3.5b extra to play with and had promises on child poverty, I know what I'd spend it on.
If only Parker and Hipkins will loosen the knots. Scallywags!
It is a particularly gnarly issue for this Government but luckily they get strong support and in a self-reinforcing self-interested way.
https://www.stuff.co.nz/business/124320206/sp-raises-nzs-credit-ratings-sees-property-prices-moving-higher
That's all well and good but what do 70% of donors, weighted for contribution, think? What will auntie Helen approve?
won't be long now, just need a bit more time to [burble, burble, economy, burble, don't scare the horses, burble burble]
The first benefit increase last year was a start.
It's not making evident inroads into our very high levels of deprivation.
It was, but even then it was easy to see that they either just don't get it, or actually believe that helping beneficiaries stops them from working or something (eg the lack of an upfront cash payment so beneficiaries could buy hand sanitiser and make plans at the start of the pandemic and going into lock down). Or being really cynical, that was an election year move.
Ardern and Roberston have a real problem here. Unless they do the big transformation (something like the GP policy, or using the WEAG report as a road map, and it has to include non-neolib responses to the housing crisis), they will continue to tinker and never get ahead of the problem.
Tinkering will mean many people will end up hating Labour. Not their core vote, but it will play out in the MSM and SM in the third term, and this is how we end up with Luxon as PM.
They don't have a plan. How is that even possible?
Right-leaning voters do not want livable income support levels. A third-way govt like this wants to keep those votes. They are counting on left-leaning voters having nowhere else to go.
But they do have somewhere else to go. Why aren't they?
Large widespread emergencies tend to reinforce conservatism. Let's see if that effect lasts until the next election..
seems like an opportunity.
Agree, although my understanding is that the government favours social insurance (or something like that) as the leading option, so they aren't doing nothing.
Grant was muttering about some insurance type scheme. Personally I wondered how anyone would be able to afford it particularly the younger crowd.
Even the better off pay income tax of 20%- 30%, GST of 15%, Student loan repayments 12% , ACC about 2%, Kiwisaver if they want a home 3% or more, all of which adds up to about 62% of their wages. Not much room to add anything to that.
Plus these schemes are catnip to the RW who at some future time would expand them and let the welfare net go.
Benefit raises would be good but I'm a lot more in favour of the lower paid getting better wages than continuing to subsidise employers. Wage and salary earners need a bigger share of the GDP plus spreading it more equally.
Also wonder if it’s time to go back to the old days of flat child benefits.
GST is so regressive to inequality.
Income support levels have been at least 20% too low since Richardson's 'Motherfucker of all Budgets'.
The NZ economy is going very well post-COVID (for most people – not all) and move to restore them back to a 'liveable' level in this year's Budget. The opportunity and timing has never been better.
Ideally I'd love to see some form of GMI as a baby step towards reforming the entire welfare system.
I'd like to see a New Zealand economy that doesn't depend on public infrastructure to prop up our entire economy for years on end. It's kinda useful, kinda good at soaking up unemployment, but not going to to drive wages up higher enough to pull the working poor out of poverty.
I'd like to see an unemployment rate with the number 3 in front of it, and Maori and Pasifika unemployment down from 10 to a number 5 in front of it.
I heard that Robertson's main economic advisor for several years just gave up and left and went to the CTU.
We are far, far too dependent on government to be a high functioning economy.
"I'd like to see an unemployment rate with the number 3 in front of it, and Maori and Pasifika unemployment down from 10 to a number 5 in front of it."
Write to the stats Minister then….the numbers are largely made up anyway
Totally agree. Another way of putting it is that because so much of our economy effectively 'farms for capital gain rather than cashflow' – too much equity 'sticks' in places where it's not very productive. And as a result we finish up relying the govt (one way or another) to keep money flowing rather than private enterprise.
Which in turn means that opportunities to invest outside of property have been very thin indeed. It's become a very 'unvirtuous' feedback loop.
I keep coming back to the tranche of tax reforms that TOP were proposing, especially their Comprehensive Capital Tax, an intelligently designed measure that was specifically designed to address this exact issue. You don't have to like the party to look at the concept and think about pinching it.
I can easily see by the end of March New Zealand will have the Reserve Bank requiring an LTV ratio of 40% deposit to buy a flat, and also Governmetn making the Bright Line Test extend to 10 years for properties bought after Budget this year, and also Government proposing something tough like floating a maximum number of rental properties able to be owned by a single person or company or Trust that doesn't have charitable status, and also some stronger social or 'sweat' equity moves for getting people with poor credit records into home ownership.
And I would not put it past the major banks to go: we expect you to get to 60% equity within a year to bring down our Bad Debt risk which the Reserve Bank tracks. I think the major banks can read.
I think this Government in the mood to act.
After the May budget, those who are on a near-50% debt-to-equity ratio might start to divest a few more.
If they are leveraged that much that they’d do better to sell now before any announcement and get out with the handsome capital gain provided by the FOMO…it pays to panic first.
Stopping business that have owning property as part of the setup from running in interest only would be a good start ,many of the empire builders in farming never plan to pay principal so can pay over the odds for property,.
If they had to pay 3% principle every year then they could only purchase land at a cost that allows 5,or 6% profit each year.
On the contrary to your characterisation of TOPs politics, I disagree with their policy. The problem is their over reliance on economic theoretical ideas which have a poor track record in practice. On the UBI front this has lead to positions (from Morgan) where beneficiaries are thrown into an insufficient UBI regime without necessary topups based on their actual circumstances.
On the CCT proposal the basic assumption is that property and other investors are 'rational' (meaning they know the actual odds of their investments succeeding and invest accordingly, as if playing roulette). If they are not and don't then there is no reason for investment to reposition itself more productively in response to a CCT anyway. This is coupled with an idea that there is a relatively fixed amount of investment available to the economy and so its about how that is distributed. In practice the amount of investment isn't really traded off between sectors, somebody investing in their property business doesn't detract from somebody investing in their orchard business in almost every case. Of course you can always do your analysis by turning all these individual investments into proportions of total investment but that is not how the institutions involved work and looks like the tail wagging the dog form of analysis.
As you have identified, a lot of property investors don't seem actually rational, in fact they don't seem to even be investing very wisely and could probably be earning more in equity funds. At least we should understand everyone definitely isn't cashing out at present prices.
NZ businesses are far far to dependent on the government to be a high functioning economy. .there, fixed it for you.
Said economic advisor is now the chief economist of the CTU (Bill Rosenberg's former position), so hardly a downgrade.
We have among the lowest government economies in the OECD as a % of GDP, so it’s not like the government spend up large compared to other economies.
If you think that the CTU is equivalent to the office of the Minister of Finance, you're dreaming. Even the most starry-eyed socialist deep mole in The Terrace would laugh.
You should demonstrate your claim with OECD figures. The last I can find are from 2018.
I'd see an extra $70billion into the economy from government spend in just 2 financial years as a massive over-reliance on the government to prop up our economy.
The alternative of the economy cratering in response to lockdown would still seem to be vastly inferior of course.
But your looking at govt financial indicators of govt intervention and then concluding things about how 'normal' the economy looks. Say the RBNZ writes off 37% of central govt debt (which they could) does that make the economy 37% less govt involved? Well no, it makes no difference at all outside of the govt books. If there must be another lockdown then it should obviously be accompanied by a similar wage subsidy and this should be understood as sensible economic policy, not some unhealthy dependence of the economy on the countries policy.
As you've pointed out yourself before, ours is the government that has had to make the largest per capita set of interventions.
Pointing out that we are so brittle that the same scale of intervention would have to be done again is not a note in our favour. It points simply that we are one of the least resilient developed economies in the world.
This is completely incorrect. The government didn't have to intervene, they decided to and the economy is doing better than others partly due to that (and partly due to fewer lockdowns).
This is not a sign of economic weakness, its a sign that the government is able to intervene in the economy to halt recessions. In fact basically it works in the other direction and the willingness of the govt to step in will determine how much/little any recession bites. Other countries have done less and are economically weaker as a consequence.
It's sophistry to say they didn't have to intervene in what was the largest economic shock we'd had in a century. Even in the National counterfactual they would have intervened – as Canterbury showed multiple times over. Their intervention at scale is not a note of weakness on their part as government.
It is however an economic catastrophe.W hat's inarguable is the scale of shock we faced compared to other developed countries. Any of treasury's GDP graphs show it. Our largest industry has been shown to also be the most vulnerable to economic shock, and other large industries have been devastated. It's a very definition of brittleL easily snapped.
Most of this massive economic shift we are having to go through is being smoothed over with public spending on public projects. So in the medium term all we've been given is just the time it takes to do infrastructure projects to completely rebuild both tourism and tertiary education.
I remember reading about it in the Tax Working Group initial issues document which had charts, but that seems to have disappeared from their website. However, from memory, NZ is a bit under 30% for central gov't (not increasing this was also a focus of the 2017 election debates) and another 5% for local govt. OECD average is somewhat higher than that, mostly because of European countries with stronger safety nets and more subsidised education (for example).
Bill was the main economist voice of unions and consequently was on a lot of tripartite forums and working groups – hardly just a socialist in an office somewhere.
A study needs to be done to establish how much rent people are paying on a benefit or low waged and how much they are left with once the rent is paid.
Treetop
i read a few weeks ago that the median rent in Rotorua was 460.00 per week.
And article from feb last year stated that the median rent in NZ was 515.00 per week.
https://www.newshub.co.nz/home/money/2020/02/national-median-rents-hit-record-high-of-515-per-week-trade-me-says.html
Here you can have a look at the benefit rates 2020
https://www.workandincome.govt.nz/products/benefit-rates/benefit-rates-april-2020.html#null
You don't need a study to be able to look at the numbers do your math and realise that the math of the government does not work.
Sadly we don't have someone like Katie Porter – who is good with numbers – and her magic white board to question the power that are currently as to their math, their compassion, and their fuckwittery that keeping people below the poverty level begging for help is going to teach anyone the value of work.
Maybe that would be a question for Jacinda Ardern, Grant Robertson and Carmel Sepuloni. Mind they know the value, that is why they are polititans and not workers.
I probably came across as being naive. I have been a benefit rights service advocate for 3 years 20 years ago. I still look up stuff. I am aware of the imbalance of income and the cost of rent.
A study needs to establish how many in a dwelling, how much income and the cost of rent or mortgage payments?
The median figure does not give a true representation of how much a person is left with once the rent is paid.
So would this be in the ballpark of what you are after?
This looks at households with kids (because "Child Poverty Monitor"), but the MSD report (cited as "Perry 2019" in the current link) includes households with high "outgoing to income" ratios.
So the population is in income quintiles (20% blocks from poorest to richest), and we can look up a variety of stats on the proportion of household income that is spent on housing costs.
Again, relating only to households with kids, half of the poorest fifth of households spend more than 40% of their income on housing, while only 10-15% of wealthier households spend >40% of their income on housing.
I could probably look through the MSD report for specific information tomorrow if you want, depending on whether my boss is watching lol.
Thank you for that.
Some sort of precision monitor is required. If genome sequencing can be done for a virus the same needs to be done for the proportion of household income (of everyone recieving income in the dwelling) that is spent on rent and mortgage payment.
This would need to be expanded further for other living and health costs.
I'm not sure what your genome analogy means.
Basically, what statistic are you actually looking for? The proportion of household income spent on housing is sliced and diced multiple ways in the perry report. We can explore that before expanding the scope to other costs.
P40, figure C.11 Shows the proportion of all households that are paying more than 40% of their incomes on housing, by quintile. For the poorest quintile, it's 30%. But recall the same data with households containing children, it's ~50% for that quintile. So now we have an idea on the position of households without children, too.
Genome sequencing tracks a single type of virus as it infects from patient to patient. It doesn't really apply as an analogy to economic data as far as I can see.
Genome sequencing deals with precision, not the best analogy.
When it comes to data for housing I want to know what the income is without the accommodation supplement (AS) and then with the AS and if temporary additional support (TAS) is accessed for rent?
I just skimmed through your links and I will read them properly.
Hmmm. There's a little bit about AS payments and housing costs in Perry, some of which seems to be from "iMSD".
If there's nothing specific enough, it might be a job for an OIA.
There was a stat a few years ago about the number of AS recipients receiving the maximum amount of AS. I'll have a think.
It might take a carefully-crafted OIA, especially regarding the pre-AS income.
A very interesting question, though.
MSD has one or two people who do massive amounts of work on incomes material hardship.
The "incomes report" has a lot of before- and after-housing-costs information by demographic and income. The downside is that it's almost a data dump, easy to drown in, running to 360 pages. But if questions can be nailed down enough, it's pretty useful when talking poverty and equity.
maybe increase the number from 1 to 2 people working in that rather understaffed department to say maybe 10?
and if you only dumb raw data you can still say you did a report. You just have to know how to find it, read it, and put it together. Its done…here ….have the raw data and a few filters. That counts as doing it or cya.
Yeah, lots of research units could do with more staff, not just in government, either.
And sure, data analysts just press a button and the outputs generate themselves, lol
Well good to now that despite pretty much all of the NGO's saying so, all of the non formal NGO's – local help groups saying so, and people like me and Weka or Bill and thousands others saying so Jacinda Adern has yet to make any statement about her statement before the election …….there will be no increase in base welfare levels.
She did not have an excuse then, and she still has no excuse. But she got her national voters to vote for her and her troupe of handmens, and I guess that was important to her.
Priorities, she has them, and one was getting re-elected and well now she is elected. Why on earth would she bother finding an excuse?
An incredibly popular proposal that a particularly popular PM could use their personal popularity to push for policy implementation:
https://www.rnz.co.nz/news/national/436866/survey-finds-69-percent-want-income-support-for-those-in-need-increased
Raising income levels is all very well, if it happens, but until something meaningful is done about housing and rents it's a complete waste of time. We all know where the increased income will go – landlords' pockets.
Indeed
Agree totally Rosie Lee – nearly 200,000 empty houses in the last census = property owners bricking their investments only looking for tax free capital gains.
The excessive commidification of housing has given us obscene numbers of empty houses while people are living in garages, couch surfing, in cars and on the street.
Exacerbating a housing shortage by "investors" bricking them also helps greatly distort rental prices in an upward direction. Can we have a large "ghost house" tax please……FFS
We all know where the increased income will go – landlords' pockets.
And from there is it will go into the capacious pockets of – the bank, the council rates, the insurance company, the property manager, the guys going gangbusters putting in insulation, kitchen vents, painting, replacing the hotwater cylinders, fixing windows, unblocking drains again, the lawnmowing dude, the people doing the smoke alarm inspection, the accountant, and of course the taxman.
All going well that is.
lol
Yep agree Red, when I used to work Public Practice accountancy (a fate worse than death), I can't say I ever saw many landlords making much in the way of income profit, or even a meaningful return on monies invested.
And then there's the stress of bad tenants, unpaid rent, damage, compliance requirements so on. Domestic rentals are sure not something that i would ever take part in.
Demonising all landlords is just plain silly.
#notalllandlords only works if the industry heads and most landlords aren't rorting. But they are. Yes, there are good landlords (mine are relatively good), but the point here is that there is a culture, sanctioned by lack of legislation and policy, that means landlords get to make excess income at the expense of poor people. It's just wrong.
Not sure when you were an accountant, but obviously the current situation is that many people are making very large sums of money from capital gains and that rents are going up beyond what people can afford to pay.
Weka, yes I agree that rents in many parts of NZ are getting to crazy and unaffordable levels, but I would disagree as to cause.
And yes again, huge tax free capital gains are possible, especially in the likes of Auckland, and I think that is the key.
I would strongly disagree that '.. landlords makes excess income…'. Of course some do, but in our society (for better or worse) both tenants and landlords need to understand that domestic rentals are a business, just like any other.
I am not too sure what '.. lack of legislation…' you are referring too, but the most obvious one and the most fairest would be to introduce a capital gains tax – and actually enforce it (taxing capital gains is already in the Income Tax Act, but I have yet to see applied by the IRD).
Its weird, if I sell a business asset for a profit, depreciation recovered is taxed, yet if I was to sell a domestic rental at a profit/capital gain, it is tax free.
P.S. I left public practice in 2007 and regained my sanity.
I still prefer the Green's Wealth Tax that they put forward at the election (or similar). It has the potential to reduce house prices as well as making NZ a fairer place to live.
Incidentally, and this is anecdotal, rents in Queenstown and Wanaka have dropped considerably due to the crash in the local economies due to the borders being closed.
ok, so you understand that what is happening now is completely different from 2007?
This piece from the Spinoff is an eyeopener,
Mum and Dad investors. And yes, they put the rent up by 1/3, not because they had to, but because "That’s what landlords do".
https://thespinoff.co.nz/society/26-02-2019/i-was-a-landlord-and-i-hated-the-person-it-made-me-become/
That is excess income. Both the capital gains and the rent increase. I'm not saying landlords should make nothing, or that it's not a business. I'm saying that too many landlords are making more than a living at the expense of poor people.
The legislation and policy I was referring to was tenancy rights. But yep, the govt needs to make major moves on the whole crisis, CGT is but a small part of that. They won't though, because people making money from housing is propping up the economy and too many of those people are Labour voters.
That kind of story is only possible because:
I guarantee you they bought it really cheap – spent a minimum on it – and then sold in a rising market. The difference between this story and providing a modern, comfortable, 3 bed home in a popular city suburb is night and day.
The people who wrote this piece were never landlords – they were property speculators right from the outset with no long term intention of staying in the business. That they rented it out for a few years was just a minor consideration on the side.
"Mum and Dad investors. And yes, they put the rent up by 1/3, not because they had to, but because "That’s what landlords do"."
I've never done that. And the term Mum and Dad investors? Pick a different term.
oh look, another #notalllandlords.
Can all of these nice landlords join the real estate lobby groups and ask for rent controls and housing quality standards? I mean, they're already charging below market rates for good properties, so they won't face the same costs as slumlords or profiteers.
lol. How do we tell which are the nice ones? Do they hand in their excess capital gains?
Every time not-nice landlords are discussed on the internet, the nice landlords use the opportunity to tell people how nice they, personally, are.
ok, so that's some pretty sound basis for policy development and legislation.
'cept, don't we need kind landlords with this govt?
lol fair call.
You've never done that but plenty do. Have you not been paying attention to what is going on?
that means landlords get to make excess income at the expense of poor people.
An actual 'in the hand cash flow income' usually only happen if the business is carrying no mortgage, and in the normal course of events it can take 2 – 3 decades to get to that stage.
Before this the owner of the business is often subsidising the company with their PAYE income from their day job. (The old LAQC tax smoothing scheme was introduced to specifically handle this almost universal scenario.)
And yes the capital gains have meant a big increase in equity – but that can only be accessed when you sell. Well not only can you only do that once – and of course on the tenant side it hugely contributes to insecurity of tenure.
Or if you refinance. At current interest rates, I am sure many are taking tax free cash out of their rental by increasing the mortgage, and this must surely be a contributor to rising rents.
Beyond introducing and applying a capital gains tax, I think only increasing supply can make a meaningful difference. Lets hope that now Twyford is gone, this term the government will make some meaningful increase in supply.
Supply is not the issue…as Christchurch demonstrates…zero population growth, excess subdivision and development and yet the prices and rents continue to rise.
The (main) cause is excess liquidity and the wrong incentives.
Hi Pat. I think that ChCh is a bad example. Since the earthquake the city has spread out hugely to the west, north west and south west. In the east of course, which has historically been lower cost housing, its just one huge barren landscape in many areas. The whole market is totally distorted.
The new dwellings are all of a certain type. Flashy, expensive and not really good rental material. So, I would strongly disagree that supply has increased in the rental market.
Agree with you re excess liquidity, along with interest rates sub 3% and the wrong incentives (lack of Capital Gains Tax).
PS: Are you sure that there is zero population growth in ChCh? That just seems counter to what I am seeing.
Would love to hear your views on other wrong incentives, and actions to take. This is a complex area for sure!
The growth is in Selwyn and Waimakariri…Christchurch city has barely recovered to its pre quake population…and the number of subdivisions particularly around Halswell and Hornby/Wigram makes the lie of insufficient land being a major driver, not to mention the number of unoccupied sites and unoccupied houses.
The wrong incentives relate to preferential tax treatment, artificially supporting above market rents with AS and no real control on outside speculation…we dont measure the true rate of offshore investment because we dont wish to have to address it.
The strategy is ever increasing house prices to provide the 'growth the financial system needs to continue as we have given up on being competitive with production.
Changing the incentives towards production carries big financial risk and will take time to show effect….risks the politicians (and in all honesty , most voters) are not willing to take.
Pat. Difficult to disagree with your points and thank you for well thought out reply.
Exactly. The equity is not locked away but can be used (semi-unlocked) in all sorts of various ways without having to sell up. It is completely different from an asset-rich but cash-poor super annuitant who cannot afford to pay the rates on their own home, for example.
The equity is not locked away but can be used (semi-unlocked) in all sorts of various ways without having to sell up.
It's not quite like going to an ATM. And once you stop working full time the big issue in accessing equity is serviceability. And of course with a bigger debt, comes bigger repayments, so all you've really done is kick the can down the road. I would only consider it in the event I had an investment opportunity that was going to put the equity to better use.
So yes you can go to the bank to get a bigger loan, but it's not 'free money'.
Servicing is done by tenants, which is one reason why rents go up even when interest rates are going down: freeing up money for the owner.
The bank only considers some fraction of the rental income. It's not usually enough by itself – they definitely want to see evidence of other income to cover your living costs.
Huh??
Yes Incognito, pull out $100,000 tax free by increasing the mortgage by $100,000. Thats only an extra $60 or so per week in cost (tax deductible) for the landlord, which in turn can easily be passed over to the tenant in the form of increased rent.
And of course the reduction in equity (of $100,000) will be replaced over time by the capital gain. Yes, not 'free money', but a helluva incentive to take tax free money now and let the tenant pay for it.
There appears to be a renovation boom that’s partly driven by low interest rates and partly by Covid-19. Much of these are done with an eye on the future at which they need to give a return, e.g. a higher asking price when put on the market. This will drive up house prices for some time. The other thing to note is that some people will want or need to free up equity as you explained to fund those renovations. This, in turns, puts an upward pressure on rents. Lastly, some property owners will take the opportunity to renovate their rentals. You can guess what that will do to rents for a long time to come. It is too easy, relatively speaking, to get credit from banks and/or to free equity for property owners and I don’t blame landlords for that. Of course, the tax regime helps too.
@Incog
Increasing your mortgage is not as simple as ringing the bank and demanding they give you money.
The three big hurdles are proof of equity, your ability to service the loan, and age.
Serviceability relates to income – and the bank never allows for the whole rental income. Usually they only count some fraction of it like 60% or even less. These days with rents so low compared to the value of the property (I know that sounds bizarre) this is usually the limiting factor on how much equity you can access.
Plus they have their own internal policies around exposure to specific risks that change all the time and you only find them out when you thought you had a watertight case – they say 'no'.
That sounds more like an armed hold-up 😉
Actually, it is, although banks prefer things in writing so e-mail generally works better, via the internet banking channel, of course. In some cases, you won’t even have to go into an actual bank for anything! For example, do you know how easy it is to apply for a new credit card with a ridiculous limit? Hint: way too easy! Yes, I know, it is guaranteed but it is essentially the same thing: increased funds for ‘discretionary spending’ AKA consumption.
Depending on your situation and what you’re instructing the bank to do, these are not all that big hurdles. Proof of equity is not always required if you have a long-term relationship (AKA history) with your bank and do all your business with/through them. They have their own ways of doing background checks too. Banks want to know about change of circumstances regardless whether you refinance and increase the mortgage on one property and decrease it on another (e.g. your home). Yeah, age is a bit of bastard but if you have a good personal super scheme a lot of things are possible with a kind and friendly bank 🙂
So, it all depends.
I guess my real point is that it's the wider housing market in NZ is where the locus of the problem lies. At present tenants are living in fear of the next rent rise, and their landlord who is likely doing their annual accounts this month – looks at their very thin, or negative, cash flow and realises the rents have to go up again.
So in essence Rosie is correct – unless this govt can find a package of measures to reduce housing costs and asset inflation – then any improvement in income support will indeed likely get absorbed in housing costs. Blaming the landlord does diddlysquat to fix this.
The anxiety will go down somewhat now that rents can now only go up once a year, it's now very hard to give tenants notice, and the minimum standards for heating and insulation have gone up significantly.
It might take a few months for all to catch up with that.
Simply really. Don't be a landlord if it's not working for you.
I was a landlord once. It came about not because I bought an investment property (that would be against my principles) but because I moved cities and I wanted to keep my house in the city I moved from in case it didn't work out in the new city.
I eventually sold it when I realized I wasn't going to move back. The realtor at the time broke the "bad" news to me that I could have been charging $100 extra a week in rent. I told him I thought I had charged a fair rent and thats what mattered to me. The rent covered my expenses a little bit plus.
I don't believe its o.k. to make a big profit out of offering a basic need to others.
to make a big profit out of offering a basic need to others.
What 'big profit'? Even if you'd been charging that extra $100pw that amounts to barely another $5kpa. Before tax.
As for ' basic needs' how do feel about your supermarket, and all their suppliers? Or any of the myriad other businesses/services you use to meet your 'needs'. Are all of these 'against your principles'?
Ha! You've got him there Red.
I have absolutely no truck with this idea that all landlords have horns and a tail and are exploiting renters by making excess profits out of supplying basic needs. Of course some do, but in my experience they tend to be of certain migrant groups exploiting their fellow migrants. Most Kiwi landlords are just ordinary middle income people who think they will make their fortune in RE and find out its just not that easy.
This isn't my experience, and this statement feels a little more problematic than "All Landlords are Bad" which precisely no-one in this thread has said except for you and RL.
No I never said 'all landlords are bad'. In fact have repeatedly said the exact opposite. Best you read my postings again if you think that. LOL.
As for migrant groups, browse through the court cases and prosecutions and you will see that two particular groups stand out for appalling rental abuses, the same two groups that stand out for paying appalling wages. LOL (which seems your default answer to everything Arkie).
No one is 'demonising all landlords', no one has said 'all landlords have horns and a tail'. You said both of these in response to reasonable criticism of the current system, it's disingenuous as no one was arguing that.
Otherwise I have no time for forming problematic opinions of migrants, thanks.
LOL
$5kpa here, $5k there, pretty soon we're talking real money – for some![wink wink](https://cdn.ckeditor.com/4.11.3/full-all/plugins/smiley/images/wink_smile.png)
I do feel a bit sorry for you RL, but that’s just the way the cookie crumbles – not everyone can turn the size of profit they feel they’re entitled to.
I was never here for sympathy.
The NZ housing market has many, many problems – and while for many people the rent they pay is the most proximate symptom of this, and the one they get most upset about – the root causes lie elsewhere.
Good to know. Re "root causes lie elsewhere", might the growing inequality of wealth distribution in NZ be a root cause?
In a more equal New Zealand we'll all be better off. Like anker, I don't believe its o.k. to make a big profit out of offering a basic need to others, mainly because that grows inequality, and inequality is, if not the root cause, certainly a root cause of social problems. A little bit like the love of money, tbh.
Some small improvements are now in effect. which is good.
https://www.newshub.co.nz/home/money/2021/02/what-the-residential-tenancies-act-changes-mean-for-you.html
Like anker, I don't believe its o.k. to make a big profit out of offering a basic need to others, mainly because that grows inequality,
And like anker I invite you to explain why you believe it's OK to provide other legitimate needs like food, clothing, etc for profit – but for some unspecified reason it's wrong to do this for housing.
Taken to it's conclusion this logic means that anyone who profits from providing housing – builders, banks, developers, material suppliers, etc – should all be condemned as equally illegitimate.
As for this idea that 'big equity = big profit' – well that's only partially true. It's not always so easy to access, and there are downstream consequences of doing so.
RL seems to be on the cusp of recognising an inherent flaw in capitalism: people profit most off folks who can't avoid it, regardless of the product or service.
Take the Hutt Valley landlord of a couple of days ago – literally putting someone out of their home of seven years because he wanted more money. Or the repeated accusations of profiteering by NZ's supermarket duopoly (didn't some supermarkets get bad press for hiking prices during the covid panic buying?). Or tobacco companies actively misleading their customers about addiction and health effects related to their product.
And many get a pass on their behaviour because "it's just business", as if greed is an excuse for exploitation. "Business" reduces every other person into two categories: a resource to be consumed in the production of the product being sold, or a customer to from which to extract as much money as possible.
Every person in a capitalist society is guitly of this alienated behaviour, the only question is the extent of our own personal guilt. But pretending that we're somehow the blameless exception is a fantasy.
When goods & services are sold, they change hands. You have certain protections under the Law too. It operates as a market as much as can be expected between fairly equal parties.
When a hotel charges for a room, it incurs GST. The price reflects quality of room & service and availability.
When a landlord rents out a property, nothing changes hands, and no GST is paid. There are few protections. The power balance is badly skewed in favour of the owners. There’s a relatively weak correlation with quality, at best. It seems to be scarce all the time.
Take the Hutt Valley landlord of a couple of days ago – literally putting someone out of their home of seven years because he wanted more money.
And as I showed at the time – the rent was still $100pw less than the market rent he could have asked. And you moan about it this.
What level of rent would you have been happy with?
people profit most off folks who can't avoid it, regardless of the product or service.
Well no – the tenant is in principle free at any time to leave with minimal notice and find something better. That they would prefer to stay and enjoy their community roots and connections – well that's their choice surely?
That in reality the NZ housing market isn't providing much in the way of better choices at the moment, is a much wider problem than just me providing a service to people that they're happy to pay for.
No, you you made assumptions that a specific property was of a certain value based on only two dimensions: geography and bedroom number. You don't even know the dwelling could be legally rented out beyond 1 July, which would limit its "market rent" to the short-term low-quality section of the market, for a start.
"happy to pay for" lol.
But you obviously missed the bit where I said it was a wider problem than just being about you. Those particular blinkers are common in people "just doing business" – it's part of the alienation caused by the "wider problem"*
*It's capitalism. Capitalism is the wider problem.
The average tenancy lasts around 18 months which points to the transient and short-term nature of the NZ rental housing market.
In the first 15 yrs of running our business, this was pretty much our experience too. But not counting a couple of legitimate evictions that we had to undertake – in every single case the tenant moved on for reasons that had absolutely nothing to do with us, the quality of the unit, or it's affordability. Usually they just wanted to move elsewhere because something in their life had changed.
People rent mostly because owning just doesn't make any sense for them at this particular stage of their life. They value the flexibility renting gives them.
Alex, I'll take "What the more mild-mannered capitalists tell themselves to sleep at night" for $100, please.
No, you you made assumptions that a specific property was of a certain value based on only two dimensions: geography and bedroom number. You don't even know the dwelling could be legally rented out beyond 1 July, which would limit its "market rent" to the short-term low-quality section of the market, for a start.'
Do you have any evidence of these assertions?
And as a rule the govt tenancy website that lists rental bands is very reliable. In this case the band for this type of property in Wainui is $500 – 550pw and even the 'increased rent' was well under this at $430pw. For the purposes of this discussion it's entirely reasonable we regard this information as accurate unless proven otherwise.
Besides if we go with your idea that maybe the property was not legally rentable after 1 July – then why are we blaming the landlord? The tenant has been living there for seven years, and seems very unhappy at the prospect of having to leave – and if the landlord reluctantly decides to sell because he chooses not to keep throwing good money at it – then exactly who is to 'blame' here?
I'm not saying it's inaccurate. Population statistics do not give reliable inferences to individual case conditions.
I'm suggesting that the "bottom quartile" value is not the same as "absolute lowest rate charged in every tenancy agreement lodged in the last six months".
but I'm totes sure #notalllandlords /sarc.
I'm suggesting that the "bottom quartile" value is not the same as "absolute lowest rate charged in every tenancy agreement lodged in the last six months".
Having spent 20 odd years doing this, all I can tell you is that the quartile bands pretty much cover at least 90% of new bonds lodged.
Sure there will be some exceptional outliers that fall well outside the band, but basing your case on them takes the discussion nowhere.
So you didn't show that he was undercharging, as you previously claimed. You were simply guessing that a landlord who thinks healthy housing regs will force him out of the market was not renting out homes in the bottom 5% of value.
Now, you might be right and the landlord is a charitable dude. But in my 30 years in the rental market, charitable landlords are pretty rare. Easygoing, sure. Willing to ignore a missed payment if we ignore the slight fire hazard or poor maintenance, sure. But charitable? Rare as hen's teeth.
But charitable? Rare as hen's teeth.
Given the tenant's circumstances – I'd bet good money on this being exactly the case.
And some landlords – especially the ones who're not using professional managers – put off increasing the rent until a change of tenancy. Given that on average this happens about every 18mths it's not an unreasonable, if somewhat lazy strategy, but it can bite you in the arse when a tenant stays for many years.
And it especially bites you in the butt when you realise the rent has fallen to 30% below market (530 – 380) *100 /520 and the govt is going to limit any future rises to 10% pa. Oh well unintended consequences and all …
Or he could just be kicking them out because although they were stable tenants for a substandard house, he won't be legally able to rent it out in a few months so needs to either fix it or sell it while it's rentable.
Toss a coin.
Or he could just be kicking them out because although they were stable tenants for a substandard house, he won't be legally able to rent it out in a few months so needs to either fix it or sell it while it's rentable.
More unintended consequences …
Not really. Regulations are needed to keep arseholes out of the market, in order to stop people figuring out that capitalism is exploitation.
But it would mean that a particular home needs significant renovation or would most likely be purchased as owner-occupier home rather than a rental. But then the new occupiers lived somewhere else previously, so that home is freed up…
But of course that's all a distraction from your assertion that random landlord in the news is charging a low rent purely out of the kindness of his heart rather than the quality of his property.
But of course that's all a distraction from your assertion that random landlord in the news is charging a low rent purely out of the kindness of his heart rather than the quality of his property.
Because you have zero experience of being a landlord you have no reference point for what is likely or not.
What almost certainly happened here is an aggregation of factors – that he'd let the rent fall so far behind market (for whatever reason), and that he had determined a need to upgrade the property (for whatever reason) – and that new govt rules were closing down his opportunity to resolve both problems.
As I said – good rules but unintended consequences.
As for your implication that some alternate economic system (that you don't specify but I'm going to assume in the absence of information is some form of neo-Marxism) – would somehow quite magically not require any regulation … well here you are worrying about me making informed guesses about a business I know quite well.
My "reference point" is every landlord I've ever had.
We know two things:
You might think they are largely unrelated.
And Big Tobacco just wanted to make cigarettes a more pleasant experience for consumers, not more addictive. /sarc
There you go again, making shit up. I made no such implication.
Dear RL, I will politely but firmly reject your efforts to attribute to me beliefs that are not in evidence. At the risk of repeating myself, and as anker stated, I don't believe it's o.k. to make a big profit out of offering a basic need (food and water, sufficient rest, clothing and shelter, overall health) to others. Like anker, that's just the way I see the world.
Question for you; is NZ’s private rental market decreasing inequality, decreasing inequality, or making little difference to inequality?
Heck, since we're talking "root causes", why not go for broke. Is the current level of inequality in NZ sustainable? I don't see how it can be, but maybe the answer depends on personal wealth – which could explain why one’s answer might change over time![wink wink](https://cdn.ckeditor.com/4.11.3/full-all/plugins/smiley/images/wink_smile.png)
I will politely but firmly reject your efforts to attribute to me beliefs that are not in evidence.
And then you go and repeat the exact belief you claim is ‘not in evidence’.
At the risk of repeating myself, and as anker stated, I don't believe it's o.k. to make a big profit out of offering a basic need (food and water, sufficient rest, clothing and shelter, overall health) to others.
As I've explained carefully a number of times – your characterisation of 'big profit' just doesn't match up to reality. Unless of course you're talking equity inflation which applies regardless of who owns the property, and what purposes they put it to.
Personally I would much prefer just to run my business for a reasonable cash flow return and forget about the equity – because the moment capital gain becomes the main consideration I'm in a different kind of business altogether.
And that's a much wider problem across many NZ business sectors, than just residential rentals.
Careful RL, you're on quicksand. At 1:14 pm you replied to me:
I intepreted that as an attempt by you to attribute to me the belief that "it's OK to provide other legitimate needs like food, clothing, etc for profit – but for some unspecified reason it's wrong to do this for housing." As it was you who introduced "supermarket" and "the myriad other businesses/services" (@3.1.3.2.3.1), and the idea of a distinction between shelter and other basic human needs vis-à-vis profits, into this thread, I politely reaffirm my rejection of your erroneous attribution of belief.
To be absolutely clear, it was you who introduced basic needs other than shelter into this thread, and I’ve made no distinction between the various basic needs when providing them for a (big) profit – that’s all on you.
, and I’ve made no distinction between the various basic needs when providing them for a (big) profit
OK so that's the answer I was looking for. Essentially you're rejecting the idea that it's acceptable to make profit. Which is a very common left wing sentiment but it just took a while to get it out of you.
And just one last time – in terms of cash flow most residential rental businesses make very little, if any profit, directly off their tenants. So that gets rid of your (big) qualifier.
Indeed the primary reason for anyone to stay in the business at present is in fact the capital gain – and as I've said before – there really is no particular distinction here between rentals and many other business sectors in NZ.
After all most farmers make most of their (big) money from capital gains – are you suggesting this makes their business somehow 'wrong' as well.
An intriguing conclusion, reflecting a common right-wing belief. I do believe that the pursuit of excessive profit is problematic, as is the definition of ‘excessive’ in this context.
Btw, any thoughts about these questions?
Question for you; is NZ’s private rental market decreasing inequality, decreasing inequality, or making little difference to inequality?
Heck, since we're talking "root causes", why not go for broke. Is the current level of inequality in NZ sustainable? I don't see how it can be, but maybe the answer depends on personal wealth – which could explain why one’s answer might change over time![wink wink](https://cdn.ckeditor.com/4.11.3/full-all/plugins/smiley/images/wink_smile.png)
That's a whole other discussion – but in a nutshell if you want to make an argument to burn down the entire modern economy – because it's 'pathological' – then I'll call you on the inevitable consequences.
It's a hackneyed argument, no future in it and best avoided imho.
Transitioning to a sustainable economy might be possible – some would say essential. But your defense of (and desire for?) big profits, and this critique of 'doughnut economics', don't fill me with hope.
Mmm… Donuts! Like profit, you can have too much of a good thing.
Question for you RL; is NZ’s private rental market decreasing inequality, decreasing inequality, or making little difference to inequality?
Heck, since we’re talking “root causes”, why not go for broke. Is the current level of inequality in NZ sustainable? I don’t see how it can be, but maybe the answer depends on personal wealth – which could explain why one’s answer might change over time.
It's a hackneyed argument.
And what am I to make of your argument when all you ever seem to do is characterise modernity solely by it's flaws.
Question for you RL; is NZ’s private rental market decreasing inequality, decreasing inequality, or making little difference to inequality?
The interesting thing about a society that's growing more prosperous is that the nature of that growth is more like multiplication rather than addition. The fundamental way to think of multiplication is that it takes a base vector and stretches it, while addition takes that same vector and shiftsit.
In other words as we become more prosperous, those who start close to zero tend not to move much, while everyone else does, and those with a small advantage at the beginning – all other things being equal – gain much more in absolute terms. So while everyone might gain at a constant rate – the absolute gap between the richest and poorest innately grows over time.
At core we should recognise that inequality is an unavoidable result of all human progress – and once we have this firmly in mind – we can then start to define why we think the extremes of wealth and poverty are a problem, and what actions we might take to start shifting the people at the bottom of the scale up toward those at the top. (A fundamentally different kind of operation to our pure economic growth model.)
And quite different than the ideas you seem to keep returning to which is to somehow cancel the modern economy so that we all collapse back into poverty. Sure that's one trivial solution to inequality, but most people are not going to think it an impressive one.
More hyperbole RL? You’re nothing if not reliable. I have, however, written here about the benefits of modern medical care and treatments, e.g. vaccines, so make of that what you will.
Despite some Luddite proclivities I'm a fan of many aspects of modernity – quite dependent/captured in fact. This hasn't blinded me to its flaws, chief among them the unsustainable nature of civilisation.
At my age the prospect of collapse doesn't worry me on a personal level, but I do wonder how our collective love of money will play out for human civilisation.
“Man is a victim of dope/In the incurable form of hope” – Ogden Nash
@RL (4:39 pm)
Does it follow that less progress would mean less inequality? And is there truly no example of human progress that doesn't result in greater inequality? Personally I reject such a bleak worldview. Wealth inequality, and particularly the magnitude of that inequality, is a choice, one that we've both made.
You know my proposed solution to extreme poverty (perpetual indebtedness) in NZ . And you know that it doesn’t require that we “somehow cancel the modern economy so that we all collapse back into poverty“, but whatever floats your boat.
Does it follow that less progress would mean less inequality? And is there truly no example of human progress that doesn't result in greater inequality? Personally I reject such a bleak worldview.
Take a rubber band, hold one end of it fixed at some point on a table top and stretch the other end to say double the length. Congratulation's you've just doubled activity and wealth in this tiny little toy economy. (It's not an even close to accurate model, but it'll do for a first pass.)
Note carefully, while on average everyone is better off, the people who were close to the fixed (the poor) end have scarcely moved at all, while those close to the end you moved (the well-off) are now doing twice as well. And that while the gap between the poor and rich started out as say 1unit – the gap is now roughly 2units.
So while we've increased total prosperity on average, we've also increased relative inequality at the same time. What then is the best strategy for retaining prosperity while at the same time decreasing inequality?
Ideally we might propose releasing the fixed end of the rubber band so that instead of growth being all about stretching the band to achieve growth, instead is became more a case of shifting the whole band in the desired direction.
Closer to reality we might think of what has happened globally in the past 200 years as a combination of both stretching and shifting, that while the very richest have extended their wealth by some huge non-linear factor, the poorest in the world have actually seen their absolute position shift significantly as well. So all is not lost – we know that in practice something of what we would like to achieve can and has been done.
Part of the solution is I think going to happen anyway over the course of this century, as demographics age almost everywhere, the nature of economic growth may well shift from being dominated by 'stretch mode' as it has been for the past two centuries, to more of a 'shift everyone up mode'. And indeed the so-called “Elephant Curve” can be interpreted as a direct demonstration of this happening.
https://en.wikipedia.org/wiki/The_Elephant_Curve
The other reason for hope is that capitalism in itself is not really an ideology, rather I see it as an emergent economic methodology that's demonstrated a remarkable adaptability over time.
What I do reject however is any suggestion that amounts to saying that inequality is all the pathological fault of the rubber band for being elastic and getting longer over time – and therefore we should burn it.
The rubber band is blameless. Burning it isn't a good idea – so smelly!
Could we perhaps stretch your rubber band analogy to include the 10% of NZers carrying a collective $13 billion of debt?
If so, then I would amend your analogy by placing the fixed point some 10% from one end of the rubber band, and then stretch the band in opposite directions away from that fixed point. Is growing debt (stretching the band in one direction) a necessary consequence of growing wealth (stretching the band in the other direction)?
One thing your analogy makes abundantly clear (pun intended) is that there's plenty of wealth in NZ, and that net wealth is growing all the time. What I don't understand is why those at the weathly end of the band (and if the band represents wealth, then the wealthy end is large indeed) suffer so greatly from ‘sharing hesitancy‘; it's almost as if what's happening at the other end of the band is of no concern. How might that play out? Still, it's only a rubber band; gummit will sort it out.
https://blogs.worldbank.org/governance/wealth-tax-address-five-global-disruptions
What I don't understand is why those at the weathly end of the band (and if the band represents wealth, then the wealthy end is large indeed) are reluctant to share; it's almost as if what's happening at the other end of the band is of no concern.
As I hinted above, and the Elephant curve I referenced shows, the stretching of the rubber band globally has probably not been a simple linear 'stretch'.
At the very top 0.1% level income growth has been astronomical, and the coarse percentile aggregation in the graph hides that. At this level I think we both agree there is a very good case to unwind the gross extremes at the billionaire level and above.
But interestingly if we look again at the Elephant Curve, while it describes global income growth, the whole of NZ would probably fit in the percentiles from 90% up. In effect NZ's experience with growing inequality is only a small slice of a much larger global story.
And to loop back to something else we touched on a while back – you ask why it is that the extremely wealthy don't seem to 'care' about the fate of those so much further down the wealth ladder than themselves. This is a fair and valid question, and does touch on why I keep thinking that inequality is less of a strictly economic issue, and much more of a moral one. And that maybe arguing to 'smash capitalism' to solve inequality is a bit like burning down the house because your partner had an affair.
At present humans value wealth because of the status and power it bestows on them – perhaps a world in which wealth was seen as a means to improve society and be of service to others would see this whole question in a quite different light.
Well said RL, certainly we can agree that some people value wealth because of the status and power it bestows. For myself it's about financial security, which in my case doesn't take much wealth.
What behaviours might model the sharing wealth to reduce inequality and be of service. Philanthropy, certainly, but how to grow charitable behaviour? So many seem to be in need in NZ alone.
http://www.nzchildren.co.nz/
https://www.greatpotentials.org.nz/
https://philanthropy.org.nz/
https://www.onepercentcollective.org/
https://www.acornfoundation.org.nz/application/files/3216/0332/3111/Acorn_Foundation_Annual_Report_2020_WEBSITE.pdf
http://montececilia.org.nz/uploads/8a12f4509874b6a26db5a8e5a0f5c6b8.pdf
https://atwc.org.nz/wp-content/uploads/2020/09/ATWC-Annual-Report-2019.pdf
Is there something similar to GiveWell for Australasia?
Btw, I’d like to meet these people that are arguing to ‘smash capitalism’ to solve inequality and give them a stern talking to. But I do wonder if ‘sharing hesitancy’ and capitalism are inextricably linked, and if so then what’s the best way to decouple them.
I'll never understand how capitalists can be convinced they're barely getting by while regarding thousands of dollars as chump change.
Well the bill I paid a few weeks back for a new heat pump install was over $4k. Chump change?
"barely".
It raises a separate question though. A heat pump is basically a fridge – why are they so expensive?
It was a decent sized Mitsubihi (much bigger than any refrigerator ) and I paid to have it installed.
If your business is set up correctly ill will go against your taxable income, write offs etc and you – in the end will not pay a cent for it.
You can now charge more for your dwelling because a law change forced you to add integral heating to your rental property.
Thus you increased the value of your asset and could potentially get more from a buyer, but also from your bank as your asset has increased in value.
You know what that is called?
Cost of doing business.
in the end will not pay a cent for it.
Still had to pay the bill for it this year out of this year's cash flow. And as a capital improvement item it will be depreciated off taxable income, that doesn't mean 'I'll never have to pay a cent for it".
In our experience adding value to a property like this has a very marginal impact on rent. Rents are primarily determined by location, number of bedrooms and condition – in that order. Improvements do potentially make the property more attractive, which helps with good occupancy rates in an over-supplied market, but if it has an impact of rent, it's maybe $10 -20pw which would take 4 yrs or more to repay the investment.
As for it increasing the value of the asset – that's an even more marginal assumption. Valuers simply don't drill down to this kind of detail.
Yes it's a 'cost of doing business' – but so are a lot of other things and they all add up. And then you wonder why the damn rent is so high.
I have to eat so therefore like most urban kiwis I have to use the supermarket.
I don't have to own a rental property, although actually I could. I have a choice, like all landlords. I am not aware of anyone who owns a rental property who got their arm twisted to do so…………but if someone knows of examples of this, by all mean let me know.
I am glad the Govt has launched some sort of enquiry into the profits supermarkets make.
I am really sorry I haven't been following your arguements Red.
I have very little if not xero empathy for landlords. I suppose I have a little empathy if there places are trashed.
My empathy lies with the tenants unless they are very bad tenants.
You might be making very little on your property, but you will realize capital gains unless there is a crash. So now might be the time to take the money and run although I am not predicting there will be a crash. When I was a landlord it didn't involve too much work.
Sorry its just the way I see the world.
I have to eat so therefore like most urban kiwis I have to use the supermarket.
I don't have to own a rental property,
That's comparison just doesn't work – the 'basic need' is not to be in business to provide the housing service, it's the need people have to be housed, like they do to eat. You’ve stacked oranges up against apples there.
My question to you is this – why do you think providing housing for people is an illegitimate business, while providing food for them (for example) is not?
Food isn't rented out.
DB Export is, if you use the pub toilet.
xero empathy for landlords
lol … are you sure you’re not an accountant?.![cheeky cheeky](https://cdn.ckeditor.com/4.11.3/full-all/plugins/smiley/images/tongue_smile.png)
lol Red. No not an accountant. Many years ago when I let our my house my lawyer referred me to an accountant though who gave advice as to how to set up my affairs to pay as little tax as possible. I think accountants are probably reasonably empathic towards property investors.
I didn't say being a landlord was an illegitimate business just one I don't have much empathy for.
I'd like to see the state provide housing and Kiwibuild to help young people get into homes.
If landlords aren't happy campers and are not making enough money then they know what to do. Sell up and let young first home buyers have a better chance of getting a house.
Btw, the $5000 extra I could have earned didn't seem right as I had to do so little to earn it and I worked a 40 hour week to make a living
Sell up and let young first home buyers have a better chance of getting a house.
That would be nice if total supply was keeping up with demand – but it isn't. At present all that would do is drive a shortage of rentals and push up rents even further.
Keep in mind there is always a legitimate demand for rental housing. Roughly 15% of the population will for one reason or another never qualify for a bank mortgage, and another 15 – 20% are at a stage in their lives where they are not interested in or needing to buy a home – regardless of affordability.
Why? Does the house stop existing if the rentier sells it? Surely the new owners were living somewhere before they bought that particular house – wouldn't their old home be freed up? Or the old home of the people who bought their old home? Sooner or later a renter will buy some home in the chain…
The only things that lower the rental market are 2nd homes and ghost homes. A beefed up CGT would deal to both – not on Lab6's radar, but sooner or later it'll happen.
Why?
Well McF – all the evidence suggests this is exactly what is happening at the moment. As I said – if total supply isn't keeping up with total demand – then everything else is just shuffling deck chairs.
"if".
The particular symptom through which the capitalist problem currently manifests itself in the housing market isn't a lack of homes.
It's a surplus of capitalists: ghost homes in Auckland – 39,000 empty dwellings. 200k in NZ overall.
But the odds are still good that a currently-occupied home would get re-occupied after being sold. So no, a sale doesn't destroy a dwelling. What makes a home vacant is a landlord who sees more profit in accruing capital value than in providing a home, and bugger the renting class.
What makes a home vacant is a landlord
Pretty much by definition if the house is vacant – they're not a landlord. It makes them property speculators first and foremost.
lol now you're doing the No True Scotsman.
They're all capitalists who buy up homes to make money. Whether they rent out those homes or feel sitting on them for the capital gain is better value for their time is moot. As markets change they switch from one to the other. You're just as much a speculator as someone who owns a ghost home.
You're just as much a speculator as someone who owns a ghost home.
Or anyone who owns any asset that increases in value, including ordinary homeowners for that matter.
But I think I'm pretty safe to say that someone who owns a property that they neither live in, nor have tenanted, are first and foremost property speculators.
"Domestic rentals are sure not something that i would ever take part in."
I wonder why so many do then
I think it is a false belief that that way lies riches, which for most it does not. that is based on having done maybe hundreds of financial statements and tax returns as a chartered accountant for landlords.
Then surely that should be demonstrated by there being truck loads of rental property on the market.
I think we know that their motivation is not to gain profit from renting but the tax free capital gain.
Which is something the rental business has in common with many other business sectors in NZ – too many are operated for capital gain not cashflow.
What we have here is an awful intersection of this entrenched structural issue, the relatively high capital intensity of the rental business, and high levels of deprivation at the bottom of the income scales.
If we want to fix this chronic problem – we need to look at the real causes. Tinkering with band-aids on symptoms usually only has unintended consequences.
"too many are operated for capital gain not cashflow."
Could you give me an example where the capital gain on a business equals that of a rental property and where similarly tax on the capital gain is not paid?
Residential property is inherently a very capital intensive business, so it's always going to be more susceptible to the impact of capital gain than many others.
Farming would be another obvious example. And many small businesses that depend on property, goodwill, or intellectual stock of some kind will look to capital gain on the hoped for sale of the business to make up for decades of marginal operating profits.
McDonald's is another example that comes to mind – the capital gains many franchisees make on their shop location may well exceed that of the actual food business.
Peter maybe they don't make so much from the rent, but they do on the capital gain.
BTW whoever said about the council taking the profit I agree with. We pay o much for so little
Are rates correlated to the average house price? I don’t think so. For example, if all house prices go up by 10%, the rates will essentially stay the same.
I don't demonize landlords – I just call them silly buggers for borrowing too much, and then acting surprised when they find that interest is gobbling up all their profits. Make interest non deductible and they would then be looking at a much improved bottom line (in bookkeeping terms) and paying a decent amount of tax – even though they would have to pay that tax from their own pockets. Under those circumstances I think that many would be thinking about off-selling their unsound investments.
Under those circumstances I think that many would be thinking about off-selling their unsound investments.
And the landlords remaining in business would simply increase rents in the face of increasing costs and demand. How do you think this helps?
There are some really great tenants who maintain the property and require a tradesman yearly if that. House prices increasing are the only sure thing for home investors. If you cannot afford the cost of being a landlord don't be one.
If a tenant had a community services card the landlord got a 50% subsidy for insulation.
I do have sympathy for landlords who get the place trashed and ripped off with unpaid rent.
More than 90% of tenants are wonderful and look after their home better than we might even. (Or at least they do on the inside – we always pay to have the sections maintained.)
But all properties need maintenance no matter how well the tenants look after them – lawns mowed, walls and roofs washing, blocked gutters, fences, drains, trees trimming, appliances like stoves, hot water cylinders and heaters break, carpets wear out, windows get broken, door locks and window stays replaced. In the usual course of events we budget for about 6% of the rental income towards R&M over the long term.
I have noticed that less and less landlords maintain the section with the exception of the lawn mowing. I would like to see landlords offer to dump the weeds. Many tenants would do weeding and benefit from the out door exercise.
I lived in a row of 7 flats and I used to weed the whole drive, fence line and door paths, (I did ask permission from any new tenant). I am no longer there but I walk past regularly – it is all over grown now. A looked after drive and section greets you.
"none of the recommendations from the Welfare Expert Advisory Group have yet been implemented"
Your link doesn't show that.
https://www.rnz.co.nz/news/national/431739/work-to-reform-welfare-system-unjustifiably-slow-child-poverty-action-group
Yes it does. Twice. Those are direct quotes from the article, no editorial.
I know, I read it and if you read the full article there's a contradiction with that statement. For example, indexing benefits to wage growth was a recommendation was it not? that's been implemented and note, the government doesn't agree with all of the recommendations.
Well take it up with the authors of the RNZ article I quoted, the 'contradiction' is not of my doing.
Why would I? and I never said it was your doing arkie.
The Government set up the Welfare Expert Advisory Group in May 2018 with the explicit purpose to investigate the welfare system. Surely having commissioned the report they are not in the position to disagree with any of the recommendations but simply implement them.
Otherwise what was the point of the group or the report?
They do disagree with some of it, its in the linked article, but it doesn't say which recommendations the govt disagrees with.
ACT bleating again. Seymour seems to want business to have its cake and to eat it too as the MBIE figure only covers one side of the equation. However, if any of the existing holidays are to be done away with, in exchange for Matariki, there are plenty of Christian ones that could go. Would he want to explain his decision to the God Squaders who vote for ACT?
There is no reason why, once the Queen dies, we cannot do away with QB weekend, leaving Matariki as the main public holiday between Easter and Labour weekend.
So many cultures around the world have festivals connected to the summer and winter solstices and the passing of the seasons. Think Stonehenge and the Scandinavian festivals. Matariki marks so much in this regard if we study the history of Polynesian cultures, the significance of the Pleiades etc – and it's distinctly NZ. It's not just about another public holiday.
Bring it on.
QB weekend is officially "the birthday of the reigning Sovereign (observed on the first Monday in June)".
So without a law change, it would simply become "King's Birthday weekend".
We can ditch it at any time.
But it was chosen as the anniversary of the Queen's ascension to the throne – the anniversary of her father's death.
And yes, we can ditch it.
I wonder if act actually do any real research. long holiday weekends are a real boost to NZ economy. even the moaners who have to pay for a days holiday for their workers do well out of them. economic activity spikes every long weekend, and a mid winter long weekend will be a real economic winner. all to difficult for actoids to understand.
Yes.
With Boeing having its entire 777 fleet grounded, it's pretty easy to see an increased likelihood of squealing about bankruptcy to get more billions of Federal aid.
https://www.theguardian.com/business/2021/feb/22/boeing-777-grounded-by-airlines-after-faa-japan-issues-emergency-order
Taking out the 777s will also be a hit to the remaining airlines.
I see its only related to P&W Engines only not GE, RR, CFM Engines. It's very rare for an engine explosion like to happen and I think the last one to happen from memory was the Qantas A380 after takeoff from Singers a few yrs back. Old mate flying that A380 was very lucky to get that A380 bird back on the tarmac from all accounts (I haven't read old mates book, but read most of the summaries incl Training & crew management or whatever its called when i was doing training and training development on top of my Operations/ Plans for the RAAF Darwin Sec FLT before i got the boot.
Well there's always one that doesn't want to follow the rules.
Australian woman refusing a Covid swab in MIQ had already protested against lockdowns – NZ Herald
I'm kinda curious what harm she thinks might come to her from getting a nasal swab done. They might harvest some precious bodily fluids?
Nose-gold -it's a thing (not really) 🙂
But so many people look at their tissues after a good blow, just in case they'd been sniffing gold dust I guess…
Fortunately NZ is a country that still has laws against compelling medical treatment.
I hope her flight home is not delayed.
Totally agree!