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Time’s up Labour

Written By: - Date published: 4:50 pm, November 20th, 2020 - 110 comments
Categories: community democracy, democratic participation, grant robertson, greens, housing, jacinda ardern, labour, Metiria Turei, poverty - Tags:

This is probably the most succinctly astute thing I have seen written about the government since the election. Standardista Miravox on twitter,

My reckon on Jacinda is that peeps likening her to Roger Douglas over housing are looking in the wrong place. She’s been indoctrinated as a 3rd-way Blairite. What’s going to be the future NZ version of Brexiteers for the betrayed? #nzpol

I can’t wait any more for Labour to sort its shit out, I think the time has come that they either demonstrate clearly that they intend to offer real solutions or we shift our political approaches around the reality that Jacinda Ardern and Grant Robertson fully intend to cement neoliberalism into New Zealand governance for another generation.

The anger about this on twitter has been palpable in recent weeks. Apparently others feel the same, housing advocate @AotearoaYimby,

I’ve been yelling impotently into the void on housing for 5 months now and in all that time I have never seen people as angry and pissed off about housing as they are this week

One thing that interests me here is what is going on with Labour voters. New Zealand had the chance this year to increase the Green MPs substantially, and thus shift the Overton Window on poverty and housing, and most left wing/progressive/liberal voters chose Labour. Is that because they believe Labour will do what is necessary on poverty and housing and climate, or because they know they won’t but still believe Labour are the best choice?

I see no point in going hard after Labourites or Labour voters. But I do think it’s reasonable to expect an explanation. I’ve seen some weak talking point rebuttals in the past week along the lines of parliament isn’t even sitting yet so we can’t expect Labour to be doing anything (wut?), or that it will take time to understand what Labour can do now that the NZ First handbrake/square wheel is gone.

But everything I’m seeing is reaffirming that what Labour are doing right now is what they intend to keep doing. If there was intention to change, to shift the Overton Window, Ardern’s world class messaging would be reflecting that. And it’s just not. Is it likely that Labour have a secret poverty/housing busting agenda we don’t know about? Tui award there.

I full expect this term for Labour to do some good things. They’re not the same as National and it’s important to recognise that under National we would be in a far far worse situation. But what that leaves us with is a reprieve not a resolution. New Zealand will tread water quite well for this term (apart from the ones already drowning), and then we might get lucky and get another term. But sooner or later, the right will rise again and the only way to prevent another decade of FJK protofascism is to shift New Zealand’s political core now. If we don’t then what Miravox is warning will come about. ACT are waiting in the wings as we speak.

We have three years to create that change and it’s patently clear that the driver for this has to come from outside of parliament.

Bryce Edwards in the Guardian, summing up his piece on the classism in the New Zealand parliament and Labour Party and how this reflects in their policy,

Forcing this government to deliver for the poor and working class might require protests and mobilisation.

Fortunately we have some allies in parliament (the Greens and the Māori Party) and this shouldn’t be underestimated, it ups our changes greatly. The Greens this week, both Shaw and Davidson, have been pushing in various media on the culture shift needed around parliamentary solutions to poverty. Aren’t we glad now that they stuck to their guns pre-election? And always, shout out to Metiria Turei, who sacrificed her political career so that we could be having this opportunity to act now.

May as well get on with it lefties. We can’t afford to give Labour the benefit of the doubt on this.

110 comments on “Time’s up Labour ”

  1. Stuart Munro 1

    We are not used, as a country, to being obliged to press a government to work for the common good as they are elected and paid to do, but not doing. Most of us would rather not, but someone must keep this ship of fools off the rocks.

    The thing is to get them to turn their thoughts to what they mean to do, instead of to what they are likely to suffer. ~ Xenophon III 1

    • weka 1.1

      thoughts on options at this point for pressing Labour to do the right things?

      • Stuart Munro 1.1.1

        Probably the most effective protest action in NZ were the land marches. But government can ignore even that sort of thing until they reach critical mass.

        A name and shame campaign against the megaslumlords might be pertinent – tolerance for faux corporate excess has been declining with housing stress.

        A certain courgette grower is begging for the Scipio Aemilianus treatment.

        Occupy protests against untenanted buildings would seem to be apposite.

        And of course freelance researching of the tax status of slumlords – the brightline CGT is heavily evaded, and the most evasive make good targets to muster support for reform.

        • sumsuch

          That Scipio despite himself supported turning on his nephew Gracchus through the 'Last Decree' of the Senate.

          • Stuart Munro

            It was more the common policy he shared with Abimelech I had in mind for our most shameless slave planters. For Roman exemplars I prefer Sulla, who wiped out corruption believed to be incurable in a few short years – he was a son-of-a-bitch, but he cleaned up the state lickety split.

            • sumsuch

              Strange how much we know about the last hundred years of the Roman Republic and how much it has inspired, like the Renaissance after 1500 years of comparative darkness. Sulla had humility in the face of Republican values. Neither the populares nor the optimates had the break pads for a democracy. Yet we who study them can see where there were possibilities for … us. Mostly Cicero's sad travels and travails.

        • weka

          I like the idea of occupying buildings. There was a ripe opportunity when National were governing to occupy state houses that National wasn't doing anything with except waiting to sell. Including ones that were deteriorating.

      • Hongi Ika 1.1.3

        Governments are now a Popularity Contest and a Soap Opera which goes around week to week on a 3 Year Election Cycle.

    • Aaron 1.2

      @Stuart Munro – Real change ONLY comes from outside parliament – We had several good Labour governments but as soon as people who remembered the great depression and why change had been necessary had passed-on there was no one left to keep Labour MPs on track. By the Lange government almost none of the MPs understood what the consequences of their policies would be so it was easy to dismantle the economy under their noses.

      Luckily there are lots of people learning about poverty now so some kind of swing back the other way will be inevitable but no one really knows when.

      I've said in the past that we would have been better off with a 4th term of National so that people would get really really sick of neoliberalism but unfortunately Labour scraped in and then were gifted a series of crises to make them more electable.

  2. WeTheBleeple 2

    It's a plain and obvious fact that money invested in the 'lower strata' of society quickly makes its way up the financial food chain. Free money (capital gains, tax breaks, poor/no regulation) to predators at the top of the food chain is silly. It's like stripping algae to make faux-fish to feed sharks. Meanwhile food chains crash and all the fish simply starve or must adapt to eating shark shit and debris.

    It's no way to run an ocean.

    This government's really good at disaster management. But disaster aversion? It obvious to everyone housing's a freaking mess (or windfall), but how would you handle it? How would others?

    • weka 2.1

      the biggest problem I see is the massive gap between house/rent prices and underclass incomes, and how middle/rentier class desires for capital gains is blocking a resolution.

      I don't believe shortage of houses is the actual problem. For one, we have a lot of empty houses in NZ. And we know how to build more. But as far as I can see the Build Moar Houses approach is based on maintaining not only current property values (with maybe a small drop), but also protecting the whole capital gains racket.

      We need sustainability design frames. Some solutions are local (Auckland's issues are different than Timaru's), and some are national (a rent cap probably needs to be applied across the whole country). I'm not seeing much in the way of whole system design approaches, but rather ideas on reductionist tweaks to a broken system.

  3. Ad 3

    Labour took the electorate in a firestorm.

    The left you speak of are the remaining watering-can circle of green.

    For those keen on actual new-built houses, Kainga Ora are doing fine in new builds. But the greatest housing new-build capacity is now in NGO partnerships.

    • miravox 3.1

      I'm really keen on new builds that take the pressure off the rental market and appreciate the government is trying to get this done. it will take time. Meanwhile renters are waiting. This market is also tied up with how effectivene increases in benefits and minimum wages. We all know there's is nothing stopping private landlords taking a big portion of tenants' income to pay their interest-only mortgages.

      NGO partnership is a classic way of adding another layer of admin (and therefore costs) to take the responsibility for shit going wrong off the government. I find this extremely cynicalof government while recognising NGOs might be working hard to do their best for people who have been unable to find decent housing.

      Less effective is the attempt to reform the private owner-occupier market. You know this is where most of the exasperation lies at the moment. How do you think that's going? and the ruling out of capital gains tax? Is there any alternative to the competition between landlords and private home buyers, or is it market rules and skewed investment towards housing rather than other productive markets? The uneven competition here shuts people out of the housing market while not upsetting those who want multiple homes. Who does this Labour government want to placate the most? Because you can keep everyone happy and eventually people who believed Labour was as the label says, are going to feel betrayed. Who is governing in their interests for the next three years?

      • mikesh 3.1.1

        Is there any alternative to the competition between landlords and private home buyers

        The costs of purchasing a property, usually through mortgage payments which include an interest component, should be the same whether the purchase is for a family home, or whether for rental purposes. At present the mortgage's interest component is tax deductible in the case of rental properties, but not in the case of family homes. This should change, preferably by making interest non deductible in both cases.

  4. McFlock 4

    I voted Green, because I think it ismportant their voice is heard.

    But I think most voters voted Labour because Labour (esp the PM) handled a number of immediate crises spectacularly well, covid being the example that allowed a fair comparison across the globe.

    I suspect that most people do not consider issues like AGW or housing crisis almost daily. Yes, at an individual level they'll be within days of going on the street, but connecting that to, say, a change to the capital gains tax? Doubtful.

    I believe Labour are conservative pragmatists, rather than "neoliberals". Basically the same impulses as the Greens, but where the Greens are prepared to go ahead of the electorate, Labour prefer to stay within what they see as the Overton Window and get elected again. Any major changes against powerful groups will get the ire of millions of dollars of billable PR hours. Especially anything that can be easily seen as the government taking money. And we're coming up to Christmas.

    So, no. Labour might release a couple of policies (maybe aimed at kids) that are cheap in the wider perspective of things but anything that allows a breathless reporter to use the word "Grinch" is out. Then there will be the usual progression of policy announcements as the budget time approaches halfway through next year.

    But frankly, if people want Labour to move boldly on some issue then they need to move the electorate on those issues. Labour would have tagged along a bit further if the Greens had the leverage to pull them, but that's not what the electorate rolled.

  5. Herodotus 5

    It’s the bbq season, and already I have heard people commenting on their 2nd and 3 rd properties increasing by over $159k each over the year. Many of us work damn hard for our wage that is taxed. And this government along with the reserve bank now implement policies that further fuel this property market. I hope our PM can do more than smile,wave and say nice things BUT so far no action.

    • Descendant Of Smith 5.1

      Even the fact that now on one income, while supporting two people, I pay over $5,000 more a year than my friends earning a similar amount but earning it between them is starting to annoy me.

      I see what they can do with that extra $5,000 per year as I somehow have to make provision for retirement for two people – I can't and will just have to work longer.

      Fixing that would help me but I'd still forgo that in order to put benefit rates back to the same as NZS rates. That should be a priority – but then I've been saying this here and elsewhere, including to Labour MP's and hierachy for a long time.

      Labour has already made my life harder by removing the ability to include my partner in my NZS (yay she could get a benefit finally when I go on NZS at $140-00 per week less than she would have got without that change), made the most vulnerable worse off by charging them 25% of their benefit (as Nick Lowe sings "cruel to be kind") removing most of their ability to put some money aside to get out of the motel they are stuck in – and yes we know some abused it but like always you can guarantee that that was a minority and it is never good practice to base decisions on outliers.

      A quick perusal of benefit numbers show that the biggest chunk are those with illness and disability. Add to that group of people with disability those like my partner who can't actually get any help because of my earnings and you have a whole group of people who will struggle in retirement. Making a difference now will make a difference later.

      Put the NZS age back down to 60 in order to encourage people to retire and create employment for our younger population would be a good idea as well. Means test from 60-65 (preferably through higher tax rates) in order to get some back from those who don't really need it.

      And just put 10% stamp duty on every house sale to dampen the market – 15% if you have to – overnight along with a rent freeze for twelve months while a rent board is established to determine fair annual only rent increases.

      • Gyrogearloose 5.1.1

        You "And just put 10% stamp duty on every house sale to dampen the market – 15% if you have to – overnight along with a rent freeze for twelve months while a rent board is established to determine fair annual only rent increases."

        The histroy of rent controls is not favorable for renters as it drives supply down, and discourages potential new builds of rentals.

        My wife and I had been looking at building a rental as an investment, using our savings, ( we don't like debt ) but with the way the legislative wind was blowing we decided to steer clear… So one less rental in the market, thanks to your cries for rent controls and the like.

        The law of unintended consequences at work.

        And as to a 10% stamp duty on all house sales…. how about for an exercise you list the potential/likely downsides…

        • Stuart Munro

          Bring in rent control hard and fast. You want to invest? Do so in something productive.

        • Descendant Of Smith

          Pretty sure I had nothing to do with your decision – especially as the government isn't looking to do what I suggested anyway.

          Clearly you are risk averse cause landlords have had it good for many years – no rent controls, tax breaks, removal of 3% stamp duty, bulldozing and selling off the state housing portfolio, increasing the market demand through kicking out state house tenants and increasing immigration and so on. If you were to invest in a rental property for the rental income then was the time to do it. The horse has bolted and the only point now is for capital gain where even the experts don't have a clue what is going to happen (it is only a few months ago they were predicting a drop in house prices).

          As for downsides there's none really. Not for the poor. Landlords have shown their predatory nature in ever increasing bounds since the Christchurch earthquake. Parasitic pricks many of them arguing that costs from government drive the market up when many have no mortgages on their properties but still charge "market rents". Rent controls have worked fine in places like New York since the 1920's.

          You know the home of capitalism.


          • Gyrogearloose

            The wiki link describes all the rent controls etc, but I did not see much commentary on the effects untill the botton under "further reading "tab. 2 given. First had a link. From that link

            "Economists are virtually unanimous in concluding that rent controls are destructive."

            And a bit further down ( bolding mine)

            " Swedish economist (and socialist) Assar Lindbeck asserted, “In many cases rent control appears to be the most efficient technique presently known to destroy a cityexcept for bombing.”

            Since it is a guote from an article in a web page you cited to support the idea of rent control, that quote could be classed as an own goal?

            Yes we are risk adverse. Nothing wrong with that, but you tone gave me the impression you considered it a mild insult. Sorry if I read that wrong.

        • Cricklewood

          Sure there is going to be downside to doing 'something', but spiralling house prices on the back of cheap credit is gonna be worse for society long term.

          We will see anyone not on the ladder getting locked out completely very quickly at the forecast 15% increases which equates to close to 150k in Auckland. The amounts borrowed are now so huge small lifts in interest rates could cripple the economy completely not to mention accomodation supplements sky rocketing in what will be a massive weatlh transfer.

          Basically a crisis point if you ask me.

      • Rosemary McDonald 5.1.2

        Totally agree with all of that DOS. There's more than a hint of 'lived experience' coming through in what you wrote.

      • Molly 5.1.3

        Stamp duty was used in the UK. From reading I did a while ago, it was successful in raising revenue, but for the investors and flippers there was an out that was not readily available to residential owners who just needed to sell.

        Companies were set up to hold properties as their single assets, and the companies were sold. As properties were not actually changing hands in terms of the law, those transactions avoided stamp duty. Stamp duty was always paid by residential owners, but could be avoided by industry flippers/property traders. As is always the case.

        The issue of housing has many contributing factors, and all those contributing factors need to be addressed. Stamp duty is one easily avoided option, and is not going to address the cost or lack of housing.

  6. Pat 6

    Rowing against the (international) tide is difficult and Labour dont have the courage so we are consigned to playing the waiting game…unfortunately we dont have the time to see who's going to blink first…we need to back ourselves

  7. So Labour's prime objective now is just to keep the other lot out, yes? Just like the other lot. No good.

    I'd like to think they're saving up the radical stuff for their third term, after which they'll most likely be bundled out anyway, so what the heck. Risky game, though. The blue wall in places like Northland and Otaki will probably be re-erected come 2023. There might well not be a third term, not with the sort of clout they can command right now, anyway.

    • Phillip ure 7.1

      Some held that hope for the third term of the clark gummint….but yeah nah eh..?…that's when the palpable desire for a 4th term kicks in..if ardern/labour continue as predicted/they have signalled…and do s.f.a. in the way of 'transforming in this term'..that will be all over rover…which is extremely depressing..

  8. Those Covid Wardens (aka Labour MPs) — won the election due to two things…

    1. The National Party fell apart, and put a person in as leader who scares people away from voting National Party

    2. Using their role as Covid Wardens as an election strategy…

    Those two things, and nothing else, won the election for Labour..

    Labour cannot rely on this in 2023 — so, my suggestion for Labour is actually listen to your voters, and ensure their wishes are fulfilled (Cannabis Law Reform, Child Poverty Action followed up)

  9. Infused 9

    The angry mob on twitter is the last lot you care about.

    Reddit on the other hand has been very interesting

  10. vto 10

    Labour and Jacinda wont do a dot about housing inflation, and they will get taken down in flames with it when the market collapses… the problem is in fact too big for even government imo… which problem is the financial system … not the RMA, not Council's land zoning, not taxes, not renters or first home buyers, not anything else … it is 100% a financial system problem

    • RedLogix 10.1

      Yes the primary driver is financial, and in my view largely because we have an unbalanced investment landscape that lacks a diversity of opportunity. And as a result too much pivots on property instead of productivity.

      But that really doesn't negate the role of all the other factors either. This RNZ series House Talk looks pretty good for those interested.

    • UncookedSelachimorpha 10.2

      Agree. The net result is more and more of the productive output of society (in particular, output of people who work) is going to fund private profit of banks – either via mortgage interest, or paying rent that pays someone else's mortgage interest. Instead of paying a capital gains tax for example (which could benefit all of society) – we are paying hand-over-fist to the private shareholders of banks. Strange that CGT is controversial while massive private bank profits are not.

      Because banks only have the ability to create money to lend (and extract interest) by virtue of legislation, there would be nothing wrong with also taxing their profits at a super-rate, e.g. 90%. Could put that revenue into building houses.

  11. Jackel 11

    The problems of housing and poverty are reasonable questions you raise that any reasonable person would think would have reasonable solutions. However, reasonable people are exceedingly rare.

    What would make anyone think politicians, public servants and capitalists would have the answers to these problems. All they have to offer are more empty words, flattering optics and feel good slogans.

    I guess at least the Greens and the Maori Party acknowledge the problems and are willing to try things to solve them.

    • Phillip ure 11.1

      @jackal..which will likely see a surge of support for both the greens and the maori party @ the next election..if labour fails to deliver ..(a good thing i.m.o.)..I am actually surprised that ardern/labour can't see that inevitable outcome…which is surely staring them in the face ..and for labour/ardern to assume that those soft nat voters who gave her/them the thumbs-up for the handling of covid…will stick around..?..that would be folly in the extreme…

    • Foreign waka 11.2

      With the money paid for housing and bank giving loans against the same, there is not much of a chance that this will correct as banks would go bankrupt. The amount paid at the moment is completely out of sinc with the improvement of any property, so the valuation will shift to land. Give me a guess what's next to maintain the value so that banks don't fall over.

      • Jackel 11.2.1

        Well yes, you should never pay more for something than it's actually worth. So there will be a correction in the housing market at some point and likely some banks and financial companies will be threatened with bankruptcy.

        These are simply the problems of a system with severe imbalances like 21st century capitalism. Increasing liquidity or credit can only work for so long firstly from central banks and now fiscally. Indeed the financial markets now bypass any relationship to productivity and simply chase liquidity. A symptom of this is asset bubbles like in the housing market.

        • Pat

          That is dependent on the ability of the central bank to support the market….and despite some theories that support is not unlimited

        • Foreign waka

          You do know about the legal means of banks to "haircut" any deposits?

          So in that regard it will be over financed projects or companies once more who will get away with taking private gain from public losses. They do this very well as we have seen with the billions that they got from every hard working persons taxes in NZ and elsewhere.

          Nothing ever changes until the problems are so insurmountable that all and everything is destroyed before something new can be build.

          • Jackel

            To me the central banks game is up. This is why we are seeing a shift to fiscal stimulus. So yes only an intractable financial crisis will bring about real change.

  12. Maurice 12

    National craftily boxed Arden into the "No CGT while she was Prime Minister" leaving only two realistic possibilities:

    1) Arden goes back on her public word and blames the Greens for 'forcing' a CGT policy

    2) Arden leaves the position of PM

    The Nats may be down but are far from out plus both ACT and NC wait in the right wings.

  13. Foreign waka 13

    Here is a thought on the housing market: why not peg the rent against value i.e lets say for argument sake a 1 Mil house would have a cap on what it could be rented out at, i.e. 2.5% of its capital value per year. This would be $ 480 per week. Anything above that will be taxed at 70%. So if a landlord charges $ 800 per week, $ 480 would be no tax but the amount above that would attract $ 224 in tax. This tax should be going towards government housing. 2 birds with one stone: no capital gains tax and a tax on rent income. This way the landlord should not be inclined to overcharge and equally if they do will have to pay increased gains on income above said cap.

    Simple to understand for everybody. No grey zones as the value is assessed every year.

    Just an idea.

    • Drowsy M. Kram 13.1

      yes, especially if the number of government houses can be ramped up reasonably quickly and strategically to decrease the demand for private rentals in regions of greatest need.

    • Phillip ure 13.2

      Could work in practice..but ardern has promised 'no new taxes'..so…?

      • Tricledrown 13.2.1

        Phillip CGT is not the magic bullet other countries have it and have the same problem.

        If the CGT was directly put into increasing house supply then it would work better as years when house prices are going up more houses are built to meet the demand like wise when there's a drop in prices no Cgt is collected.

        Many different levers need to be pulled.

        Including micro and temporary units as they are doing in Napier the same could be done elsewhere so everybody has warm dry shelter Labour needs to make real headway on solving the housing crisis and child poverty.

        Oh why doesn't the govt bailout local bodies like Auckland City this is time while money is cheap to help Auckland to keep the infrastructure upgrades needed .Auckland needs a massive infrastructure upgrade to meet future demands that it can barely meet now.letting Auckland go into Austerity cuts is damaging our whole economy!

        Come on Labour get some guts.

        • Gyrogearloose

          Since most of NZ foriegn exchange earnings came from agriculture and tourisim (pre covid) I have occasionaly wondered how the rest of the country would fare if Auckland magically vanished….

          Income not much changed, expences reduced notably?

          Before bailing them out maybe it should be asked ' is auckland paying its way'.

          If the answer is yes, and if better infrastructure would improve its profitability then yes.

          If the answer is no, then why throw good money after bad.

          • KJT

            As most of our high value net, foreign exchange earnings, and the high wage paying jobs, and most of the real value added to commodity exports, mostly come from Auckland, and the rest from cities like Hamilton and Christchurch, As well as most of the people who actually pay taxes.

            It is not "Auckland, that is "not paying it's way".

            • Gyrogearloose

              You "most of the real value added to commodity exports, mostly come from Auckland,"

              What real value does Auckland add to agricultural exports? At a bit of a loss here.

              Export data has agriculture products at around 65% of product exports, at around 24b usd tourisim from wiki was 7.7b usd

              Have not had much luck finding enough to pin the answer down.

              You got any data to back your position?

    • Lettuce 13.3

      Not a bad idea FW. However, I fear it would be doomed on arrival by claims of 'communism by stealth' and 'Muldoonism' from the same speculator/"investor" class that was so effective in killing off any proposed capital gains tax.

      Also, expect plenty of crocodile tears from lobbyists like the NZ Property Investors Federation and REINZ along the lines of, "Won't someone please think of the poor tenants when all the landlords decide to exit the market because the costs to them are too onerous?"

      • Foreign waka 13.3.1

        One of the hall marks of any labour party is – social justice. Now there is an opportunity to show true colors.
        As for exiting the market, to keep houses unoccupied would be too expensive and the other option is to sell. This is the market force at work, more houses come into the market.

  14. Scud 14

    Well here’s another one that the NZLP / PGF has knocked back, yet they want to go to Carbon Free Economy or Clean Green Transport Footprint (Sorry if the got terms/ meanings ass about face).


    The numpties in the NZG have knocked a $41m plan from ECAN to build a joint Rail-Bus & Tourism hub on the corner of Moorhouse rd & Colombo st, which folks is actually not far from the old CHCH Railway Station stood before the Earthquakes.

    Another example of do as we say, but won’t do because well it costs to much. I mean WTF folks both Rollie to Ashburton, Rangiora to Amberley, Rollie to Springfield are screaming out for some type of InterCity/ Rail Bus Hub. Yet this Government & the previous NZG was throwing money about from PGF for Rail Projects but they won’t for this one.

    It doesn’t need to be a all singing & dancing one with all the bells & whistles as most of the Infrastructure is there, a couple of new Stations on the existing platforms relaying of the double track from Islington to Rollie, putting back the old turn out (junction for the non rail people) heading towards CHCH and installing Bi directional signaling on the single tracks. There is enough Rolling stock about and Locomotives to get this service up and running.

    PS. If the Mods, want me to use this as a post let me know I can probably find some stuff to add to what I’ve already written.

  15. Okay folks – if you are really concerned, then I suggest you write – slightly different letters each – to your local Labour MP, the PM, and the Minister of Finance – and anyone else in government that you think you have a relationship with. There are a number of valid comments and suggestions in this thread, and they need to be made directly to government Ministers and MPs.

    Email addresses to PM and Ministers are initialstopsurname@ministers.govt.nz

    Email addresses to MPs are first name surname@parliament.govt.nz

  16. Grant not Robertson 16

    One solution to help curb house price inflation merely requires a little legislation.

    These days houses, almost uniquely, do not have a price. Stocks and shares have a price, butter and cheese, meat and vegetables have a price, cars have a price, tradies have a price, building materials have a price, but houses don’t – resulting in the highest possible sale amount being routinely wrung out by an ever eager estate agent.

    So the solution is to give houses a price – a registered valuer sets the price and that’s it. No auctions, no gazumping. You might want to finesse the arrangement by saying that the vendor has the right to choose the people buying, but essentially you cut out the absurd procedure whereby those with access to enormous funds can bid silly money to get what they want.

    So who loses? Well the banks and real estate agents, two groups who don’t command huge public sympathy.

    • Foreign waka 16.1

      Both of which know that greed gets them every time….

    • weka 16.2

      I've been wondering why we can't put limits on house sale prices, but this is even better.

    • mikesh 16.3

      So the solution is to give houses a price – a registered valuer sets the price and that’s it

      Valuers base their valuations on previous sales so, in that situation, prices could never change, regardless of changes in real underlying values.

  17. Jester 17

    It's hardly surprising that rents are increasing, as Labour have forced landlords to add insulation, heating, fans etc. This was always going to flow through to increased rents. I still believe it is mainly the lack of supply that is increasing the house prices.

    • Descendant Of Smith 17.1

      Fuck off – I know landlords with zero mortgages and over 20 rental properties. They have had them for years and years. They put their rent up as the market changes – nothing to do with actual costs.

      Newer landlords I know have big mortgages cause they are all competing against each other and have high rents cause they paid too much for their house and want someone else to pay the mortgage. The increased cost of purchase is much more than maintaining the property to a liveable standard. If interest rates went up they would be shafted. Look at the rents being charged for hovels all over the place – nothing at all to do with increased standards – everything to do with ridiculous prices.

      Get angry at the banks for lending that freely that the cost of purchase of land is so high. Get angry at successive governments for massive immigration and not building state houses as the population increased.

      • mikesh 17.1.1

        Newer landlords I know have big mortgages cause they are all competing against each other and have high rents cause they paid too much for their house and want someone else to pay the mortgage.

        Mortgage payments shouldn't really be influencing rental prices as mortgages are payments for the house itself, and such payments should therefore not be considered part of a landlord's regular business outgoings. If a landlord cannot make a suitable profit over and above his mortgage payments then his business is simply not viable and he should therefore get out of the business.

        I suspect that too many landlords are attempting to get "someone else to pay the mortgage", and that this why we have so many problems in the rental sector.

    • Foreign waka 17.2

      Jester, we are not anymore in Dickensian times. It stands to reason that for those extraordinary amounts of rent you should get value in return. I mean the consumer laws are quite clear about that. If a landlord cannot deliver than maybe he/she is in the wrong "business".

    • weka 17.3

      "This was always going to flow through to increased rents."


      • Jester 17.3.1

        You have you never run a business have you? If you increase the costs of supplying the service eg. a house to rent, then these will be passed on via a price increase to the end customer. This is why I also prefer a tax cut at the moment for lower income people than raising the minimum wage. eg. coffee shop paying new person $18.90 per hour and charging $5 for a large coffee. Minimum wage increases to $20 in April 2021 say, large coffee becomes $5.20 or something like that.

        • weka

          it was the inevitability I was asking about. Just because costs increase, doesn't mean they *have to be passed onto the tenant. Costs of improvements could be soaked up as a normal part of the business management. Sure, some landlords will be on their edge financially and won't be able to do that, but I doubt that it is most. So that leaves us with ethics and values. Best get the govt to intervene if landlords don't know how to do the right thing.

          • Jester

            I think you will find a lot of landlords are not that well off. The rent may nearly cover the mortgage payments then there is the rates and insurance and R&M. So they may well already be topping up the shortfall.

            • Pat

              Then now would be the time to sell

            • weka

              I have a sibling in this situation. They bought a second house in a holiday town so eventually they will be able to holiday there and probably retire. But the rent doesn't cover the mortgage, so they are paying part of it out of their own income. They will eventually even that out, and the capital gains they make will mean they will be in a very good position when they retire.

              Whatever is going on there is no excuse for expecting another human to live in substandard housing (afaik their rental is in good condition). I'm with Pat on this, if you can't keep a house up to a certain standard then it's time to sell to someone who can.

              • Jester

                I agree the property needs to be in good condition but with the new rules the rental may well become better than the landlords own home eg. the landlord may not have a heat pump / insulation but the tenant by law will have. The landlord is bound to pass on these costs as per my original comment. Yes landlord can always sell if it all gets too much for them (and that's not necessarily a bad thing). Tenant too can always move but problem seems to be lack of choice for them due to not enough supply at the moment.

                • weka

                  the problem with the idea that tenants can move is that it still leaves a sub standard house being rented out. Hence the need for minimum standards.

                  My point above was more that landlords don't *have to increase rents, it's not an automatic follow on from having rental standards.

                • Gyrogearloose

                  As a uni student, one year my friends and I were happily living an a real student dive. Bad rot in a number of places, large fungal growth in the bathroom when we moved in, completely overgrown 'lawn' , cellotape windows etc.

                  We were in heaven!

                  This was because the rent was half that of any other place…..

                  Would not be allowed now days.

                  • Pat

                    define now days…that sounds like the flat my son (and his uni mates ) lived in a year ago…and it wasnt half the price, or even cheap…sadly they had signed a 12 month lease without seeking advice (as they do)

                  • Jester

                    As you say, a flat like you describe would no longer be allowed to be rented to you as it wouldn't meet the standards. When I was a uni student I would be the same…it was all about saving money (usually for the pub!) and living as cheap as possible. eg. wouldn't turn on heater to save on power bill. Would rather rent a cheap dive than pay more rent for all mod cons we would never use. Unfortunately no cheap dives left now.

            • mikesh

              It is not the tenant's job to pay the landlord's mortgage. If the landlord is relying on that for his operation to be viable, then he shouldn't be in the business.

              I suspect that there are too many unviable businesses cluttering up the rental sector.

      • Cricklewood 17.3.2

        Because rentals are run like businesses, its essentially a costs plus margin type scenario and with the market settings as they are and increases are easily passed on with the margin on top.

        • weka

          sure, but many landlords don't have to pass costs on.

          • Phillip ure

            Yes..but they invariably do..it is what makes them the parasites that the rentier-class is…

            • Herodotus

              So why then have not rent reduced given the dramatic drop of mortgages, we had a dramatic drop in 2008 Floating went from 10.5% to 6.5% yet I do not recall rents dropping. The increase in costs is a simplistic reason given to increase rent, to make the property pay its way- if then that is the case any Capital gains are not part of the business logic in purchasing a property 🤫, so then taxing it should not be an issue. mmm


              • Chris

                Yes, interest rates keep dropping and rents increase. It's not uncommon for landlords to hike rents by huge amounts – a hundred bucks or more – as soon as a tenant leaves. Heck, landlords are kicking people out with that very objective in mind – and often ignoring the 90 day rule by trying to shoehorn, wrongfully, the situation into one of the exceptions allowing for a shorter period. Abolishing the 90 day notice without reason may help a little but landlords will simply respond with use of fixed-term tenancies that aren't renewed, then hike the rent for the next tenant.

  18. Duncan 18

    It's quite clear that Labour have no intention to do anything about property prices. In fact they seem quite happy with them spiralling out of control, firstly by Jacinda proclaiming she wouldn't let house prices fall, and second by the RBNZ deferring LVR restrictions until March next year.

    This is an open invitation for investors and speculators to dive in with the current QE regime. Stupid, you never signal anything like this to a market unless you desire the exact outcome we are getting.

    Both Labour and National have been complicit over the years. The issue really goes back to the 90s when Bolger and Shipley removed housing from the CPI, and by declaring the RBNZ independent, but without the means to lifts interest rates to control house prices, absolved themselves of any blame, as they profiteered nicely from the doubling in prices every decade ever since.

    And then you had John Key flying Chinese down with laundered cash and special visas to buy up large in Auckland with suitcases of laundered cash, and denying responsibility as it was part of the FTA. Utter BS of course, but it worked, and those properties still lie vacant.

    What can you do to solve it? I really don't think they care. They know the middle voter is driven by greed and trying to get ahead. Even if we all suffer as a result. I don't think a few thousand emails will do much. Everything has been stitched up so the situation is irreversible, and the myth that the banks are too big to fail is ingrained. You can't put housing back in the CPI or else interest rates would be 9% and the NZD worth 5 USD. Jacinda has ruled out capital gains (easy capitulation) and the workers demand for immigrants to slave drive will never disappear. Not too far away you will get fined $200 per night for having to sleep in your car.

    Maybe a few thousand self-immolating on the steps of parliament, but it might have to get quite a bit worse before that happens.

    Or rioting, probably more likely than revolution, and will just give the government more excuse to put the boot in.

    Really the only hope is to protect yourself and your loved ones the best you can when the whole ponzi scheme falls over and the shit really does hit the fan.

    • Pat 18.1

      It will end…as you say when the ponzi scheme runs out of wherewithal or possibly when the costs of supporting the housing bubble are outweighed by not supporting it…either way the result will not be pretty

    • Foreign waka 18.2

      Very well surmised.

  19. sumsuch 19

    We're forcing them. Or, reality. I was just thinking NZers don't like politics anymore so can't be persuaded anymore intellectually. Unless force of reality. How perplexed Jac/Grant are.

    I find them ridiculous.

  20. xanthe 20

    Just imagine if we had a party in New Zealand that had spent the last 25 years building a suite of policy founded on ecological wisdom. They might just have something to offer. pity all we have is cheerleaders for the neoliberal revision of the treaty and identity division of status quo.

    Oh well I guess we just have to start from the ground up now.

  21. Treetop 21

    Could the Reserve Bank lend money to the government to build state homes and also lend money to Kiwibank for first homes and to exclude property investors?

    Government money is required and the money needs to be generated or borrowed to allow long term affordable housing.

    The cost of emergency housing is ballooning. I do get it that people need somewhere to live.

    Where in the government system does the money come from to pay for emergency housing?

    • Treetop 21.1

      The emergency housing special needs grant pays for emergency housing, so through Work & Income. From 19 October 2020 25% of income is charged for the emergency accommodation.

      Is W&I the best place to manage emergency housing or state housing?

      I get it that W&I need to fund the emergency housing but they are doing nothing to expand permanent and affordable accommodation.

      • Craig H 21.1.1

        Kainga Ora (formerly HNZ) is still responsible for building state houses and is building thousands each year. W&I's job with them is assessing whether people meet eligibility criteria for a house.

        • Treetop

          W&I have an expectation that a client looks for alternative housing so do most councils who offer subsidised housing.

          W&I are not realistic about the client being able to afford alternative housing so W&I pay for emergency housing or give the accommodation supplement and top the rent up with TAS. A vicious cycle is created.

  22. Blue Sky 22

    An inventory of housing can be done and assume that one person/bedroom it can be determined if there is a shortage in various areas. Obviously you can lie about rooms being bedrooms and the size of the rooms but there would be ways of controlling this. If you determine where the bedrooms exist in the country you can actually truely see supply demand requirements in different areas. This would not be so hard to do. After that it would be a matter of penalising owners of unoccupied space in pressure areas and watch the market adjust overnight. There would be a clear idea where jobs and people need to move.

    • Pat 22.1

      Clarity/availability of information impinges on too many vested interests to ever be seriously implemented

    • Foreign waka 22.2

      Beware of what you wish for. It has to be one law for all to be democratic. Home owners will not want to be penalized because not all of their bedrooms are occupied. (Guest room?)

      But: there ought to be a clause in any property ownership where a house becomes unoccupied. This could relate to: deemed abandoned (timeline), safety and security in the neighborhood, any impact on infrastructure, i.e underground pipes (tree roots etc.), power lines due to neglected maintenance etc. You cannot force people in perfect maintained properties and paying all their rates and taxes to take in lodgers or penalize them on nebulous charges.

      • Blue Sky 22.2.1

        There does not seem like much evidence reported on housing. The most basic measure would be m2/population. If bedroom counting is too problematic count m2/person. I agree it should apply to all housing. Private and state.

      • Pingao 22.2.2

        One problem is that there are not enough small houses being built or existing 1 or 2 bedroom modest houses available to buy – I'm not talking about units or apartments or even townhouses. So you wind up with people like me and several of my single or couple friends who enjoy living in a house with a bit of garden and a bit of space between themselves and their neighbours living in larger houses than they need (or want).

        • Foreign waka

          Blue Sky, Perhaps I did not express myself clearly, my apologies.

          I do not support any state agency marching on any property taking over rights that belong by law to the person who a/ has bought the property, b/ lives in it with family, c/ paid their taxes and rates. For me, discussions are closed on that one. (I do not support fascism)

          If, however a property has been abandoned and on contacting the owner no change of status has been achieved, lets say within 12 months, than the property ought to be legally deemed abandoned and be part of the councils assets.

          This would fix the issue of so many Auckland properties staying empty, about 40 000 of them. Of cause to see this through you need people in the council/government with determination to see things right. National was not prepared to touch the issue, it has been mentioned a couple of times by the current government with a remark " it is not black or white". Well, nothing ever is. Another lost cause of hope for some pragmatic solutions…..one of so many.

  23. vto 23

    this is a sure fire way to rattle the cages and kill two birds with one stone: tie minimum wage rises to house price rises…

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