Now that we know the extent of non dom involvement in our housing market, the Government needs to act. Instead, all we’ve heard from the Nats is laughable holier than thou posturing on race and a variation on the usual whine that Labour did it too.
However, on the latter matter, Labour recognised there was a problem late in the Clark Government. The 2008 Housing Report was a comprehensive look at the state of the property market. The election later that year ended any possibility of change as a result of the survey.
On the former, the National Party (and their dependant contractor Act) have zero credibility in that area. Kiwi not Iwi, Orewa, Hone Carter anyone?
But, to move on, National need to pull finger and end foreign speculation today. They have the ability, but do they have the will power?
There seems to be a consensus that the figures presented by Labour on the weekend are reasonably accurate. If so, it’s clear that there has been a rapid rise in offshore sales. The BNZ’s Tony Alexander said just two years ago that his analysis was that 9% of buyers came from offshore nationally, with 11% of Auckland house buyers coming from offshore.
Aleaxander’s figures suggested that in nationwide sales, people from the UK were most represented, with 18%, followed by China with 15% and Australia with 14%. In Auckland the Chinese were the biggest individual group, with 19%. Labour’s figures show that those demographics have skewed significantly toward China.
We now know that foreign non dom purchases have rocketed and are seriously distorting the market, shutting out local residents. This needs action, not bluster. However, all Steven Joyce can offer is that official statistics will start to be taken from October. However, it appears, he intends to keep the results secret, so that’s no help at all. Even Fran O’Sullivan is calling bullshit on that weak response*.
What National need to do right now is declare a temporary moratorium on sales to non-residents. Stop the sales dead. Now.
Then put legislation through that echoes the Australian system, where overseas investors can only put their money into building new houses. Because new houses is the issue. That addresses the supply side of the equation, which underpins the NZ housing crisis. When they are less houses than there is demand for them, prices rise. Only lifting the supply can stabilise prices.
If National don’t want to write their own legislation, they can borrow from the opposition. All three parties are committed to ending foreign speculation. They all have similar plans ready to go. National should recognise this situation for the nationwide problem it is and approach it on a cross party, collegial basis. That’s the leadership New Zealand needs.
The second thing National needs to do now is commit to building truly affordable housing. Not half million dollars, middle class affordable, but affordable to the minimum wage, fire at will Kiwis that National are entrenching as an underclass. We have the workers, we have the timber. All we lack at the moment is the willpower in Cabinet.
It is a national disgrace that our home ownership rates are at an all time low. If we are not to become tenants in our land, John Key and his cronies need to put the interests of New Zealand ahead of their personal fortunes. Sure, it’s great for Key that his personal portfolio of McMansions is rocketing in worth, but it does the rest of us no favours at all.
The market is failing us, John. The Parnell Ponzi scheme must end. It’s up to you to show real leadership. Kiwis are angry. Soon they are going to turn that anger on you. If you don’t act you are going to be chucked out next election. It’s that simple.
*Edit: Fran O’Sullivan has been raising the stats issue for some time. See her comment below. TRP