Megan Woods: ‘We are not going to lose money on housing’

Property

Why Labour believes the government needs to underwrite housing developments, and how it plans to 'stabilise' house price growth when it's up against the RBNZ cutting interest rates

7th Oct 20, 9:44am by Jenée Tibshraeny

Labour continues to believe government can help increase the supply of housing by underwriting residential housing developments.

The Government is already underwriting houses that meet the KiwiBuild criteria; committing to buying them if the developer can't sell them.

Now, it’s designing criteria for a new underwrite it will provide across a broader range of housing types and price points, on top of KiwiBuild.

The aim of the scheme, which will be funded from a $350 million recyclable ‘Residential Development Response Fund’, is to make it easier for developers to secure finance at a time Covid-19 is seeing banks be cautious with their lending.

Speaking to interest.co.nz, Labour’s housing spokesperson, Megan Woods, said she didn’t want to see house building activity stall like it did after the 2008 Global Financial Crisis.

“What we heard very clearly from developers after lockdown was that banks became very risk-averse - looking for up to 100% presales on some developments - which just meant we were not going to get those housing developments underway,” she said.

“This allows developers to get on with it, because they can go to the bank and say, ‘We do have a government underwrite that effectively means 100% presale’.”

‘We are not going to lose money on housing’

Woods, who unveiled the fund as Housing Minister in August, assured it wouldn’t leave taxpayers out of pocket.

“We are not going to lose money on housing,” she said, stressing that should the government need to buy a property, there was high enough demand to give her confidence it would be on-sold.

“What we know is that these houses will sell. It may take a little bit longer than a developer needs to get on with building their next development… but they will sell,” she said.

According to the latest available data, the Government had bought a total of 244 KiwiBuild and formerly KiwiBuild houses as at the end of August. It had managed to on-sell 124 of these, so had 120 unsold houses on its books.

Taxpayers step in as risk-averse banks back away

Woods believed it was unfair to suggest the new scheme would see the Government underwrite “dodgy” developments that banks are too scared to lend against.

She said banks’ nervousness typically related to the type of housing - townhouses and apartments being deemed riskier than houses built on large plots of land, which are likely to appreciate in value.

Woods wouldn’t drop any hints as to what the criteria for the underwrite would look like, other than to reiterate she would want affordable housing to be part of the development.

The new Crown entity, Kāinga Ora - Homes and Communities, is expected to be ready to start receiving applications from developers in the first half of November.

House price ‘stabilisation’ the goal

Woods said she wanted to increase the supply of affordable housing “without radically readjusting house prices so that people are losing equity in their homes”.

“What we want to see is some stabilisation of prices,” Woods said.

“The kind of growth we’re seeing; I think everybody would agree is a huge impediment to people getting into the market.”

Median price - REINZ

Select chart tabs

Source: REINZ

RBNZ the elephant in the room

Asked whether Woods, who’s been dubbed the “fix it” minister, could realistically do anything about house price inflation when the Reserve Bank is to a great extent trying to stimulate the economy via the housing market, Woods said the effect of low interest rates on housing affordability was only one piece of the puzzle.

Asked when was the last time she was briefed by the Reserve Bank on the impact its monetary policy was having on her portfolio, Woods said: “I don’t get regular briefings from the Reserve Bank.

“Obviously, that gets worked through by my housing officials. I get briefings from them around how things like interest rates are impacting housing.”

602 KiwiBuild homes built

Turning to KiwiBuild, Woods didn’t have plans to adjust the criteria, further to changes made to increase demand and reduce the Government’s exposure to risk.

As at the end of August, there were 602 KiwiBuild homes built, 712 sold (including off the plans), 927 under construction and 325 on the market.

In addition, 65 homes, initially earmarked as “KiwiBuild”, had been sold on the open market to people who don’t qualify under the KiwiBuild criteria. An additional 31 were available for sale on the open market.

Labour campaigned, at the 2017 election, on building 100,000 affordable homes in 10 years under KiwiBuild.

Nonetheless, the market is starting to deliver more high-density housing, as the number of building consents issued also increases.

Building consents - type

Select chart tabs

Source: Statistics NZ

Public housing waitlist nears 20,000

As for public housing, the waitlist has soared to nearly 20,000 under the Coalition Government, despite it increasing the supply of public housing.

Woods said the Government had added 5670 properties to the public housing stock in this term, and had allocated funding in the 2020 Budget for 6000 public houses and 2000 transitional homes to be added to the stock by 2024.

She believed the balance between addressing the needs of those requiring public housing and those wanting to buy a first home was about right.

Woods defends progress on progressive home ownership

On the latter, Woods said the Government had moved “swiftly” to get a progressive home ownership scheme off the ground, despite it only in July allocating its first $23 million to two community organisations to scale up their existing offerings by 103 houses.

Woods said the first families would start moving into their homes in November.

Work is underway to establish an initiative within Kāinga Ora for households with an annual income of under $130,000 to receive shared ownership support directly from the Government. This is expected to be available in early 2021.

National is campaigning on enabling state housing tenants to buy the properties they rent from the state via a progressive ownership scheme.

Twyford’s big piece of urban development legislation not registering with Woods

Woods didn’t know whether any housing projects had been earmarked to go through a new streamlined consenting process outlined in a major piece of legislation championed by Urban Development Minister Phil Twyford.

The Urban Development Bill, which was passed in August, gave Kāinga Ora all its powers, including to acquire land and override provisions in RMA plans or policy statements.

Enshrined in the law is an entirely new process aimed at streamlining the consenting of large-scale public or private housing developments.

Asked why the Government hadn’t been lining up projects to use the new process, so it could hit the ground running once the legislation had been passed, Woods confused the process with a piece of legislation passed in response to Covid-19 to fast-track infrastructure projects.

Twyford’s office later confirmed: “There are currently no projects identified to start the initial stages of the Specified Development Project process.”

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88 Comments

by GV 27 | 7th Oct 20, 10:05am 1602018312

“What we know is that these houses will sell. It may take a little bit longer than a developer needs to get on with building their next development… but they will sell,” she said.

If only there was some sort of price mechanism they could use to shift stock faster, something like house prices going up, but in the opposite direction? It sounds crazy I know, but maybe there's another way that doesn't involve the government underwriting holding costs for developers who have a product that can't sell at a certain price point. This is how we get 60sqm homes with an asking price of $600K in Auckland.

by bw | 7th Oct 20, 10:18am 1602019114

"It sounds crazy I know" No, no. Crazy - is allowing home prices to fall to a level that people can afford to pay without shackling themselves, and their future, to +30 years of debt servitude." But what would they do with all the disposable income that isn't then tied up in debt repayment?!". Who knows! But why don't we find out?
(NB: Actually we already know the answer. It's taught to our children from kindy onwards. "Buy an investment property or two" It's the Kiwi thing to do". Whatever corrects this distorted 'market' is going to hurt. "Stabilising prices" never happens.)

by WhiskeyJack | 7th Oct 20, 11:45am 1602024357

It sounds to me like the government just said they won't let house prices fall, because that would cause them to lose money.

by FamilyGuy | 8th Oct 20, 9:26am 1602102408

Labour is trying to have it both ways. they are desperate and will say anything to please voters to just win the election. Jacinda wants two or three terms and so anything goes.
As i said earlier, it is not their fault. We voters are too dumb to understand and just fall for tricks- such as NZ's PM as the best PM in the world :).
Vote these career politicians (both National and Labour) out if you want to save the country.

by redcows1 | 7th Oct 20, 10:23am 1602019406

I predict this thread will rise to a whole new level of sarcasm re house prices.

by Henry_Tull | 7th Oct 20, 10:39am 1602020341

Fascinating to see one of Labour best in action.

Going hard for both nanny state and crony capitalism.

The RBNZ has already rescued the banks & flooded them with cash.
Bank lending to residential developments is driven by pre sales and fixed price build contract (because the developers themselves are terrible credit risks).

Next question what developers is Megan going to help out?
Will it be like tourism and see the operator with the corporate jet that gets the most $$ and love?

by Henry_Tull | 7th Oct 20, 10:41am 1602020518

P.S. it not like Megan's ideas are going to get any better.

by powerdownkiwi | 7th Oct 20, 10:43am 1602020613

You'd be familiar with this trait?

by Henry_Tull | 7th Oct 20, 11:27am 1602023257

More life imitating Art.
There is a whole show that folk in US & Canada are crazy for, two women lost as teenagers.

PEN15. If you can't see Megan & the PM (BFF) in this, it's too funny.
Trailer:
https://youtu.be/oFAHiU0g0xQ

The girls on Conan:
https://youtu.be/u5pjaZohbrI

PEN15 is described as "middle school as it really happened. Erskine and Konkle play versions of themselves as 13-year-old outcasts in the year 2000, surrounded by actual 13-year-olds, where the best day of your life can turn into your worst with the stroke of a gel pen."[4]

by GV 27 | 7th Oct 20, 11:57am 1602025072

Remember when the median Auckland house price was $125K cheaper before the last election and National was supposedly asleep at the wheel?

Jenée has the story of the election; watch it get ignored and watch PM Ardern not get asked about it once during a debate.

by Quidgybo | 8th Oct 20, 9:22am 1602102154

I think it is criminal that journos are not holding any of the coalition to account on this. Not even a little! All the hullabaloo about cannabis and not a peep on one of the biggest speculative housing bubbles in the history of the world.

by Audaxes | 7th Oct 20, 10:28am 1602019695

“What we want to see is some stabilisation of prices,” Woods said.

Is this responsible RBNZ regulatory oversight?:
Banks extending 60 % of their lending to one third of already wealthy households to speculate in the residential property market because the RBNZ offers them an RWA capital reduction incentive to do so.

Or this?:
RBNZ cutting OCR in half five times since July 2008, causing the rich to capitalise rising discounted present values of future asset cash flows.

by WellingtonInvestor | 7th Oct 20, 6:08pm 1602047294

I just wonder why during the good economic times between 2010-2020, why the RB didn't raise interest rates back up. Instead they kept dropping them, I think there were only a few rises during that time, even though the crisis was apparently over. Houses have been able to rise so much in price mainly because of the record low interest rates. If the interest rates were up to 6-8%, house prices would likely be a lot less.

by Independent_Observer | 7th Oct 20, 7:21pm 1602051718

Did you see what happened in the US when they attempted to raise rates? The economy is much weaker than anyone politically is letting on.

by oreo | 8th Oct 20, 7:04am 1602093898

I am thinking exactly the same, and I think that was Key’s plan. Make all his mates bankers and his constituency richer no matter what

by cmat | 7th Oct 20, 10:38am 1602020330

“I don’t get regular briefings from the Reserve Bank.
“Obviously, that gets worked through by my housing officials. I get briefings from them around how things like interest rates are impacting housing.”

Looks like she dodged the most pertinent question (tantamount to "my little people deal with the big gorilla") which makes me think she doesn't have a clue / no understanding about the real driver of issues in her portfolio.

I therefore have zero confidence in her ability to solve the problem.

by J.C. | 7th Oct 20, 11:03am 1602021780

Yep. It's clear from all this Kafkaesque / half-baked neoliberal nonsense that she doesn't understand how housing and asset bubbles in general are driven by Anglosphere monetarist hegemony and a banking system intent on destroying the value of money for their own short-term ends.

by Advisor | 7th Oct 20, 11:08am 1602022083

The Urban Development Bill, which was passed in August, gave Kāinga Ora all its powers, including to acquire land and override provisions in RMA plans or policy statements
There are currently no projects identified to start the initial stages of the Specified Development Project process

This bill was passed on the premise that 19k new mixed-use homes were to built urgently over the next 10 years to relieve housing pressure. We still have 20k and counting on the social housing waitlist but no ongoing development plans.

It sounds an awful lot like yet another lever our neoliberal overlords are pulling (holding back state supply) to keep rents and house prices elevated. Dodgy!

by J.C. | 7th Oct 20, 11:36am 1602023783

You refer to 'neoliberal' here, but your quote includes the words: bill, passed, powers, provisions, plans, policy, projects, process.

This is the bureaucratic piece as illustrated by Franz Kafka.

by taimaiakka0 | 7th Oct 20, 10:42am 1602020550

'We are not going to lose money on housing’

You will not as will keep the ponzi alive.

' Woods said: “I don’t get regular briefings from the Reserve Bank.'

It implies that have been briefed about house price shooting up and is aware but wants to ignore the issue as wants to keep the ponzi alive.

Supply is an issue but like national party are not interested in talking about speculative demand. Now their is no difference between National and Labour as far as housing is concerned.

Now labour wants to provide more money (as if low interest rates are not enough) to mum n dad builders to add fuel to already inflated house price.

by Kauri | 7th Oct 20, 8:25pm 1602055540

This statement by her also does my head in: “...without radically readjusting house prices so that people are losing equity in their homes”. I don’t care if I lose equity in my home! - sort out the supply issues, sort out the demand issues, sort out the tax benefits of housing etc and let the market work. I buy a car, a boat, any other thing and I lose equity straight away, why should a house be any different.

by al123 | 7th Oct 20, 8:42pm 1602056536

What are the circumstances where it would matter a lot to lose equity? If you fall under 20%, and thus have higher interest rates: It would be fine with me if some provision was made for owner occupiers in that position. If you want to borrow money to start a business- again it seems like that could be sorted by special business loans or something. I'd rather we introduced special fixes for those problems rather than the current 'fixes' which seem to largely benefit investors (accommodation supplement etc). I can see there's good reason for taxpayers to step in to ensure people dont lose their homes - but why should taxpayers be on the hook for ensuring investors can make massive profits without having to shoulder any risks?

by powerdownkiwi | 7th Oct 20, 12:19pm 1602026344

Neither main political party would get voted-for, if folk thought house prices - and therefore their appraisal of their wealth - were going to fall. Furthermore, more and more are clipping the ticket. Furthermore, the best resources are gone, both spatially and materially. So every next option is more expensive/worse.

But a Minister of Energy shouldn't be conflating housing (resource and energy requiring) with 'cost'.

And nobody should be avoiding the question of growth; population; limits; overshoot, unmaintainablility. We won't be able to maintain what we have now, infrastructurally, yet we are all contemplating 'more'?

Delusion of the first order.

And Jenee - try asking what square metreage per New zealender there is, and has been, year on year. Why do we talk of 'houses' as immutable units? I'm betting we've inexorably increase the sq/m per head. Begs a different question; the polarisation of wealth-holding and where does it lead?

by Just a farmer | 7th Oct 20, 10:42am 1602020562

Some massively fudged numbers there from the minister to hide how much of a failure KiwiBuild has been.
They may have “only” had to buy 244 HOUSES but they have bought thousands of sections in failed developments where the developers haven’t been able to even get enough interest to start building the houses.

https://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=12339757

More than 1,300 failed KiwiBuild sections bought in Te Kauwhata to start with.
This is what happens when the government agrees to underwrite developers with no checks and balances to ensure that developers will at least try and produce something that people want to buy.

by powerdownkiwi | 7th Oct 20, 10:49am 1602020956

I'm not a Labouite, but I watched what the Key/English regime did to lower-end housing.

Labour - indeed all Parties - are up against Limits to Growth problems now - at which point all bets are off. You can't 'fix child poverty' or the 'housing crisis' when both are a 'human population crisis' (read: gross overshoot). Classic examples of 'pollies who don't 'get it' must include English and Davidson (who apparently though you have the right to triple the population and with it the spatial and resource demand.

by Foxglove. | 7th Oct 20, 12:37pm 1602027423

There is first much to address in the underbelly of the construction/housing industry. Labour has signalled an enquiry into the dominance and cornering of supply of materials and other aspects. They will need to address too the application and performance of builders themselves. There are far too many fly by nighters and corner cutters. They have been allowed to evolve as such and it is a threat to any person wishing to have a new home built or any project in fact. The papers are full of failed builders, their companies, liquidating and starting again under a new flag. The builders know LBP & MBIE are toothless. There needs to be a reporting come audit system, by random if you like, annually of a good number of builds whereby both bad and good practices can be documented .

by refactornz | 7th Oct 20, 1:27pm 1602030476

Except that many countries overseas (including wealthy countries) have much higher population densities so "Limits to Growth problems" isn't the real issue in NZ.

by powerdownkiwi | 7th Oct 20, 4:23pm 1602041003

refactornz - get with the programme. The First World particularly, purloins stuff from under other folk.

And most of what you consume - particularly energy - comes from 'somewhere else'. Take that supply away, and we'd be struggling to support 2 million hereabouts. The prior incumbents used to be so short of post-battle energy, they ate the losers - and there sure as heck weren't 2 million of them.

by refactornz | 7th Oct 20, 4:56pm 1602042978

That's a great answer to a different problem, but nothing to do with NZ housing affordability in 2020.
We're not living in the dark ages so no need to eat the losers.

by powerdownkiwi | 7th Oct 20, 5:42pm 1602045767

You're further behind than I thought. Tonight's research, for you:

https://www.sciencedirect.com/science/article/pii/S0921800919310067

If we don't do something about population and energy-consumption, we will be living in the dark ages. By my reconing, within a decade. A hint - you seem to have a lot of assumptiveness in you - try and divest same before reading the paper.

by refactornz | 8th Oct 20, 10:57am 1602107851

It's easy to link to a 12,000 word article, but that still doesn't explain housing affordability in NZ with our relatively small and sparse population. Sure, global limits to growth are a contributing factor to housing affordability but they are not the dominating factor for NZ in 2020.

by Jenée Tibshraeny | 7th Oct 20, 11:40am 1602024015

Hi Just a Farmer, good query thanks. Only a small portion of that Te Kauwhata development received a "KiwiBuild" underwrite. The larger portion received a general underwrite.

But, the Te Kauwhata development was one of the developments Megan Woods removed from the KiwiBuild programme when the Government did the reset in September 2019. Altogether, it removed around 433 houses from the KiwiBuild programme. This meant these houses would be sold on the open market and/or bought by the Government.

I assumed the figures quoted in the story, provided by Kainga Ora, took account of these properties. I thought they wouldn't fully reflect the changes made at the reset, as these properties might not have been put on the market yet.

I am just checking in with Kainga Ora now to find out whether those houses removed from KiwiBuild were reflected in the figures it gave me. Will keep you posted.

by Jenée Tibshraeny | 7th Oct 20, 4:49pm 1602042546

Kainga Ora has confirmed the KiwiBuild figures it gave me, which I quoted in the story, didn't include the 433-odd properties it removed from the KiwiBuild programme at the reset. I am waiting to hear whether the Government ended up buying any of these, and if so, how many remain unsold.

by Just a farmer | 7th Oct 20, 4:58pm 1602043134

Thanks, I am from Te Kauwhata and it is certainly a controversial issue in town about what the future holds for that whole development.

by Quiet Desperation | 7th Oct 20, 8:41pm 1602056517

There's certainly quite a few out there. I heard about these kiwibuilds earlier in the year, as the high price was amusing for the area at the time and is still not very desirable even now, given their spec and location right next to the highway. Four remain, with the listings only recently removing any reference to kiwibuild and now courting investors. It's the second time they've been listed. Been left to rot at a ridiculous price, for at least 12 months, possibly longer. https://www.realestate.co.nz/3776538/residential/sale/4-dalwood-crescen…

by Just a farmer | 7th Oct 20, 9:37pm 1602059837

Have a look at https://www.trademe.co.nz/property/residential-property-for-sale/auctio…
That is one of the KiwiBuild houses in Te Kauwhata. They have stripped detail out of the listing for that as well, these houses are 60m2 on 190m2 sections for $480,000. No garage and not even enough space to park a normal sized car off the road on your own section. May as well buy an apartment in Auckland!
For comparison $550,000 buys you a nice 3 bed, 2 bath 150m2 new build house on 600m2 roughly in another subdivision in town.
Just that KiwiBuild has given developers licence to build shoebox houses and as long as they are priced just under the KiwiBuild price cap then they can’t lose as the government will underwrite them.

by Fritz | 7th Oct 20, 9:56pm 1602060985

That's mad.
'Living the Kiwi Dream', apparently...

by Alter Ego | 8th Oct 20, 10:03am 1602104592

550k will buy 3 houses in France.

Niece has just bought a lifeStyle block with acres of land and nice 4 bedroom house for 150k Euros.

It all depends on what you want in life....A millstone here, a lifestyle build of stone to last forever over there....

I could give you further info, but it is way cheaper to live in France, food wise, and other wise......But it does have its draw backs....

Italy has offers to buy a cheap stone house as long as you do it up.... No brainer if plenty of munny....and Euro does not drop like a stone....

Have put holidays on ice at the moment......better poor in NZ...than rich and dead in White House, Shite House, Rock Bottom House, with COVID.

I bet you any munny, Trumps House of horrors is just waiting for another idiot to take over the White House.....cougH Cough......dead to writes......says I....And Twitter is getting the facts straighter than a do-llaly Politician fixated on nowt but talking ...non-sense.

by Jenée Tibshraeny | 7th Oct 20, 10:55pm 1602064543

Final verdict - the story is correct.

Kainga Ora confirmed the 120 unsold houses on the Govt's books as at the end of August included 49 houses removed from the KiwiBuild programme at the reset. These were the 433-odd houses, including some at Te Kauwhata. These 433 houses weren't included in the total tally of KiwiBuild houses built (602) quoted in the story. Hope that makes sense.

All the best with your situation too, Just a Farmer.

by Fritz | 7th Oct 20, 10:07pm 1602061671

Wow, that developer has done well out of that...
What a strange place in the middle of nowhere for Kainga Ora to underwrite...???....

by printer8 | 7th Oct 20, 10:45am 1602020727

". . . how it plans to 'stabilise' house price growth when it's up against the RBNZ cutting interest rates . . . "
Would be great. Just like KiwiBuild.

by Brock Landers | 7th Oct 20, 11:23am 1602023003

House prices are a lot like body weight. When you only aim to "stabilise" it at a morbid level instead of bringing it down to a healthy range you continue to suffer all the negative consequences of being overweight.

This woman seems to not understand that our housing market is obese and needs to go on a diet. Pronto.

We don't need rent to own schemes and subsidies and million dollar shoeboxes to live in. We don't need the accomodation supplement jacking up rents. We definitely don't need this idiotic government setting anti competitive price floors at every level of the market with their developer welfare. We don't need this government sending out signals that you cannot lose, ever, by bidding up the price of housing.

What we need is healthy house prices. That means they have to come down before the market and the economy have a fatal heart attack. We are a grossly uncompetitive economy because of our cost of housing.

It's infuriating beyond words that these condescending pricks in Labour got elected to fix housing, watched them go up another 29%, then tell us now they must stabilise and must never be allowed to drop and they are going to use our tax dollars to make it so.

What a miserable future this country has ahead of it with Labour or National in charge.

Price stabilisation is a fairy tale being told to get elected. Bubbles don't peak and stabilise, they overshoot and implode when the prospect of speculative gains dries up.

by rastus1 | 7th Oct 20, 11:17am 1602022650

Which is why Nat nor Labor will get my vote. I will caste one and that will be for TOP.
Radical as they seem, they are the only party willing to tackle this. I'm not wasting another vote on the big boys.

by Brock Landers | 7th Oct 20, 11:34am 1602023685

Agreed.

I gave Labour the benefit of the doubt last time to sort out this cancer and this utter incompetence and stupidity is what we got instead.

TOP probably won't get in, but I'd rather still vote for them than endorse this s**tshow a second longer.

by J.C. | 7th Oct 20, 11:41am 1602024071

I gave Labour the benefit of the doubt last time to sort out this cancer and this utter incompetence and stupidity is what we got instead.

The framework in which they operate and the learned behaviors to participate in that framework are the problems. They're not inherently incompetent or stupid people. However, understanding how to maneuver within the framework means that some people have a purpose in life without actually achieving very much.

by Whatwillhappen | 7th Oct 20, 1:11pm 1602029479

ACT want to free up development and let people do what they want with their land without councils getting involved. A few flaws with their plan, but if their solution works, house prices WILL go down.

by Albert2020 | 7th Oct 20, 2:28pm 1602034118

ACT would repeal the FBB as it’s their philosophy that a vendor should be able to sell to anyone in the world...that in itself will prevent house prices from falling.

by Advisor | 7th Oct 20, 2:37pm 1602034624

Judith Collins is committing to repeal it as well and also lower bright-line test back to 2 years.

That's somehow going to make housing more affordable in NZ and open up more supply for FHBs.
The pro-market parties either don't understand how market forces work or are banking on their gullible voters' inability to understand markets?

I hope, in saying all this, I am not disrespecting Samoa!

by iconoclast | 7th Oct 20, 2:31pm 1602034294

David Seymour's Perfect housing no controls
The house next door
https://www.youtube.com/watch?v=aC-A6SP3EsQ

by J.C. | 7th Oct 20, 5:00pm 1602043227

Seymour is a clown. His ideal world doesn't exist anywhere. Perhaps Cambodia.

by Starr | 7th Oct 20, 9:36pm 1602059763

Yep TOP got my vote this year . We need modern policy that looks after future kiwis

by karl seastrand | 7th Oct 20, 12:18pm 1602026285

BLanders..So well put!

by oreo | 7th Oct 20, 12:21pm 1602026490

Well said brock landers

by consumer | 7th Oct 20, 1:01pm 1602028863

Nailed it!

by Alter Ego | 8th Oct 20, 9:59am 1602104346

Brock....Most Common Sense quote I have seen here for me to up-tick......Pity the rest of the World is in denial.....Along with the idiots in charge of wasting our Tax Payers Dollars on themselves and their "Accomodations" Where did we go so wrong......I do know...maybe some others are 'learning' too.

by Due Diligence | 7th Oct 20, 11:10am 1602022201

Supply is the answer

by powerdownkiwi | 7th Oct 20, 12:21pm 1602026486

Only to the wrong question.

by DoTheMath | 7th Oct 20, 1:14pm 1602029673

Supply would reduce prices, which is not allowed to happen.

by 1986 | 7th Oct 20, 11:15am 1602022556

To me it sounds like they are moving in the right direction, albeit slowly. If all parts come together, Covid continues to keep our borders closed for the next few years, a bunch of new tradies getting trained up and hired etc... then we might start to balance our supply and demand. Land availability might be an issue but there is plenty of under utilised land in New Zealand. Linking up regions with good, fast transport options would help make this work. Questions are what is a fair price? and if prices do go down or stabilise, will they hold off on immigration or start pumping it up again. Maybe make NZ a high skilled remote working paradise if this needed. Also, can they deliver... I hope so!

by Advisor | 7th Oct 20, 1:03pm 1602028982

The immigration ponzi isn't going anywhere. Both parties are awfully quiet on temporary and permanent migration rules. I understand borders are to remain closed for the foreseeable future but people movement is likely to fully or partially reopen within the next government term.

Also, INZ has announced that international candidates studying online with an NZ education provider are eligible for post-study work visas upon graduation.

by 1986 | 7th Oct 20, 1:27pm 1602030440

Post study work visas for degrees that have added value make sense like scientists, engineers etc...

by Advisor | 7th Oct 20, 1:59pm 1602032386

Only a fourth of the 60k international students in 2019 were studying sciences or engineering at the postgraduate levels. Commerce and social sciences make up more than half. No point leaving the door open for all and hoping the right ones will come in.

https://www.educationcounts.govt.nz/statistics/tertiary-education/parti…

FYI This is how we treat our scientist community:

Back in May, Massey laid-off casual workers in its college of sciences, many of whom were postgraduate or PhD researchers.

Earlier today it was reported that up to a 100 permanent jobs in the science faculty could be slashed.

the loss of revenue from fee-paying international students would have "a large negative impact" for the whole university .

https://www.rnz.co.nz/news/national/427732/massey-university-could-cut-…

by Believer1980 | 7th Oct 20, 3:49pm 1602038948

:) immigration ponzi? sure, you may disagree with the immigration policy, you can justifiably call it the disastrous immigration policy but ponzi? common

by Advisor | 7th Oct 20, 4:33pm 1602041631

Not my words: used often in Stuff editorials to describe our broken immigration system.

This government and the last simply tinkered around the edges on visa settings despite multiple reports from journalists and MBIE itself exposing the fraudulent practices adopted by the export education sector and low-value employers in NZ.

So rampant is the wrong-doing that Immigration New Zealand assistant general manager Peter Devoy appears less than thrilled that Stuff's probe means more work for his overloaded investigators.
Bernie Madoff should have emigrated to New Zealand. He would have made a killing here.

https://www.stuff.co.nz/national/107357690/editorial-our-ponzi-scheme-o…

Even during Covid, the ponzi is still alive and well: https://www.newshub.co.nz/home/new-zealand/2020/09/auckland-restaurant-…

by Fritz | 7th Oct 20, 9:59pm 1602061151

It's definitely a government backed scheme to keep the low wage, high price housing ponzi economy pumped.

by hemihua | 8th Oct 20, 7:34am 1602095695

What else would you call it? We seem to always need more immigration to cater for population growth caused by... immigration.

by Apex Andy | 7th Oct 20, 11:46am 1602024395

I can now see that NZ greed is exponential.

by oreo | 7th Oct 20, 12:23pm 1602026622

Agreed

by CourtJester | 7th Oct 20, 12:25pm 1602026713

Jenée asking the right questions (which aren't asked by any mainstream media, surprise surprise), Megan Woods giving the zero substance BS you'd expect from most politicians. It's a shame that neither of the major parties wants to address the most pressing issue in NZ.
So the housing minister wants to maintain prices while pumping up construction of 'more affordable' houses...

My question is, what would make those new constructions cheaper than the existing similar sized leaky moldy shacks? If they're the same (or better quality), then obviously that would drive down the price of the existing houses. If not... then they're not suitable habitats for humans.

by Fritz | 7th Oct 20, 10:00pm 1602061213

Well put. Woods is one of the worset BS merchants in the government. And that's saying something.

by Henry_Tull | 7th Oct 20, 12:26pm 1602026784

Here is a worked example of COL govt dishing out real $$.
Plenty of red flags as tells to crony capitalism.

https://www.odt.co.nz/star-news/star-districts/star-selwyn/canterbury-d…

Canterbury district's ‘shovel ready’ roading package denied Government funding

District council asset manager transportation Andrew Mazey said the council did not receive a specific reason for why the proposal was rejected

https://i.stuff.co.nz/national/politics/122949457/prime-ministers-suppo…

Labour leader Jacinda Ardern’s support for the $11.7 million funding for Taranaki’s Green School is at complete odds with advice from the Government’s lead economic adviser.

Repeat is at complete odds with the advice from the Governments lead economic advisor..

by powerdownkiwi | 7th Oct 20, 1:02pm 1602028954

Both were stupid proposals.

There isn't the oil left on the planet, to re-seal all the existing roads and keep trucks on them for, say, 50 years. We went wide, we went short-term, we went stupid.

So any EXTRA roading is bollocks, at this stage in human affairs.

But the idea that a single school could introduce an ideas-change, is both wrong and too late anyway. Teaching reality (that economics is bollocks and that they're being handed a shyte sandwich; all the problems and none of the energy/resources) should be mainstream; part of the Curriculum.

by Zack Brando | 7th Oct 20, 1:59pm 1602032353

TOP is the only game in town.

by Due Diligence | 7th Oct 20, 2:20pm 1602033604

On par with Advance NZ in terms of political relevance and quality of policy...

by youngdumbandbroke | 7th Oct 20, 3:56pm 1602039366

So still better than National and Labour?

by kiwi_overseas | 7th Oct 20, 5:02pm 1602043340

ABSOLUTELY ABSURD.

a) The government is simply propping up housing prices by interfering where there is a functioning private sector market.

b) The governments role is to:

i) get on and build houses for the homeless and those in temporary motel accommodation where there is no private market as developers cant make a profit.

ii) fix or remove the RMA

by powerdownkiwi | 7th Oct 20, 5:52pm 1602046329

The 'private sector market' is nothing more than the rich getting richer and the poor getting the pitcha. Governments are what society puts in place, to alleviate that trend - it stops the elite heads going tumbril/blade/basket every now and then. Makes like better all around.

As for the RMA, so help me, can you not see what has happened in the last 30 years? In every way we've increasingly stuffed the planet, and even where we think we're doing better in NZ, it's only because we've offshored our shyte. But even if there were NO regulation whatever (probably your mantra-taught ideal?) we are still coming up against the Limits to Growth - as per the paper I referenced up-thread (Read it all - it's worth the time). It's not regulations that are the problem, and if you look behind them, many are a result of individuals trying to commandeer the Commons (which when they own or monopolise, they profit from). Believe me, even with no restrictions in place, exponential growth is always impossible within a bounded system. And that's all that population and housing growth were - exponential growth numbers. Place the blame where the blame falls; exponential math.

by Fritz | 7th Oct 20, 5:46pm 1602045966

What Woods still doesn't seem to get is the market failure at play.
Sure, underwriting will help a little, but it won't deliver affordable housing because it is still predicated on developers making profits.
What she needs to get into her thick skull is that it is only by the government building housing itself, en masse, that progress will really be made.

by powerdownkiwi | 7th Oct 20, 5:54pm 1602046487

It will never fulfill, will always be behind. See mine just above.

What is needed is a population reduction - aiming at sustainable levels. Any more growth is just nonsense.

by WellingtonInvestor | 7th Oct 20, 6:05pm 1602047114

There are apparently 140,000 empty houses in NZ according to stuff in 2018. So why isn't the government doing anything to get these houses lived in. Who owns them, and why are they leaving them empty? Is having tenants too hard now, due to many of them not treating the house well?

We have 20,000 people waiting for a state house in NZ, yet 140,000 empty homes....therefore there shouldn't be anyone waiting for a house to live in.

Why is the Maori party the only party with a policy that I have seen about these ghost houses?

by WellingtonInvestor | 7th Oct 20, 6:11pm 1602047469

There are soooo many things that can be done to bring down the cost of houses and building. But the status quo is always easier. Why are we paying so much for materials in NZ for one, when they are often a lot cheaper overseas. Why is billions of dollars each year being spent fixing construction errors and poor workmanship? We all end up paying for these.

I still want to buy a kiwibuild home. I have never owned a house before. But nothing in my area. I don't want an apartment in Auckland thank you, I want a freehold house on it's own piece of land. NZ has plenty of land. Why aren't they building some in smaller towns on transport routes to cities, Many small town are getting a lot of people moving to them?

by Fritz | 7th Oct 20, 6:07pm 1602047261

Despite what some on this website think, many of the agencies advising Woods are full of neo libs. And she's taking their garbage hook, line and sinker.

by J.C. | 7th Oct 20, 6:43pm 1602049437

What agencies?

by Fritz | 7th Oct 20, 6:45pm 1602049512

HUD, Treasury. Lots of neo libs in those places.

by firsthomecryer | 7th Oct 20, 6:41pm 1602049316

Jenée for prez imo.

by Roger the lodger | 8th Oct 20, 12:12am 1602069145

Thanks Jenee for the excellent article and interview. It is staggering how little Megan Woods knows about her portfolio and the causes of the housing crisis. Not that she's a terrible minister - she just has been too busy to get to understand the issues. It is a bad reflection on Labour that they have dumped it on her.

Surely the elephant in the room is the terrible effect urban containment (anti-sprawl) policies in Auckland have had on all of NZ's house prices. The median Auckland section price on Trademe (and realestate.co.nz) is an incredible $600K. This filters right through the country - and results in developers trying ridiculous developments in place like Te Kauwhata and Pokeno - because they are in the Waikato District and not controlled by Auckland Council. Probably the most bizarre example of this is Sleepyheads weird proposal to build 1500 houses and a factory in Ohinewai - because the Auckland Council is incapable of allowing them to take a paddock in Auckland to do it there. Instead all their workers need to be uprooted from their families to go down to the middle of nowhere to work.

The housing crisis is simple to solve - allow houses (and factories) to be be built where people want to work - mainly Auckland. This is the silver bullet. People don't want to live in high density - and they dont want to have to move to hick towns for the privilege of owning their own hovel. Dump the Auckland urban limits and let people build houses anywhere. Any environmental effects cannot possibly be a hundredth as bad as the misery these policies have created.

by hemihua | 8th Oct 20, 7:29am 1602095355

In Wellington these 'affordable' 'houses' are actually shoebox one bedroom apartments with no car park and a price tag of $500k.

by Pusheen | 8th Oct 20, 11:10pm 1602151857

We need to be patient, the new people movement/migration saviour will be couple months away. But the draft plan already been approved for initial fund movement from offshore to plug the current debt hole. National & Act agreed with it, Labour is just happened to action it while at the helm.