What Labour delivered on housing vs what it promised

Property

A housing stock-take after three years of a Labour-led Government - what was and wasn't delivered

16th Oct 20, 12:36pm by Jenée Tibshraeny

Labour campaigned strongly at the 2017 election on addressing the country's housing crisis.

So how did it go? Here's a table comparing what it delivered versus what it promised.

Green: Delivered
Orange: Semi-delivered
Red: Not delivered

WHAT LABOUR PROMISED IN 2017 AND WHAT IT DELIVERED ON THE HOUSING FRONT
Supply
Establish an Affordable Housing Authority to work with the private sector to cut through red tape and get new homes built fast.	Kāinga Ora - Homes and Communities established in October 2019.
Build 100,000 affordable homes for first-home buyers over 10 years via KiwiBuild.	As at the end of August: 602 KiwiBuild homes built, 712 sold, 927 under construction and 325 on the market. Eligibility criteria broadened over life of scheme to increase demand. KiwiBuild underwrite concept extended to housing developments more broadly.
Partner with private developers, councils, and iwi to do major greenfields and revitalisation projects, building affordable homes with KiwiBuild and the private market.	The Urban Development Act, giving Kāinga Ora the power to speed up the development of large public or private urban development projects, was enacted in August. There are no projects lined-up to use the Act.
Remove Auckland’s Rural Urban Boundary and free up density controls.	Auckland’s Rural Urban Boundary remains in place, but further development has been provided for via the National Policy Statement on Urban Development 2020.
Increase the number of state houses and stop the sell-off that occurred under National.	The number of public housing places available has increased from just over 66,000 in late 2017 to 71,886 as at August. The number of eligible individuals/families on the public housing waitlist has increased by around 14,000 to nearly 20,000 over this time.
Invest an additional $60m over four years in new emergency housing.	There’s been additional investment in transitional housing and the Housing First programme, aimed at helping homeless people.
Review the role the Ministry of Social Development plays in managing the public and emergency housing programme with a view to consolidate these functions within Housing New Zealand.	A number of functions have moved to Kāinga Ora, but the Ministry of Social Development still manages the public housing register and is responsible for providing Emergency Housing Special Needs Grants.
Invest in making sure all state houses are warm and dry.	All Kāinga Ora houses and registered Community Housing Provider houses must comply with Healthy Homes Standards by July 2023 - two years later than when private landlords must comply.
Retain the RMA and reverse objectionable changes made to it by National.	The Resource Management Amendment Act 2020, which received royal accent in June 2020, tweaked the RMA.
Convene a panel to advise on how to ensure the RMA is fit for purpose.	A working group has delivered a comprehensive report recommending the RMA be repealed and replaced by two new pieces of legislation. Labour has committed to forging ahead with the recommendations at a high level.
Demand
Extend the bright-line test from two to five years. Maintain the family home exemption.	New rule applies to property bought after March 28, 2018.
Require property investors to offset rental losses against income from their property portfolios, rather than all their income.	Took effect in the 2019/20 income year.
Ban non-resident foreigners from buying existing New Zealand houses.	Took effect in October 2018.
Set up a Tax Working Group to ensure there's a better and fairer balance between the taxation of income and assets, in particular the capital gains associated with property speculation.	Government refused to implement capital gains tax recommended by Tax Working Group.
Rental reforms
Increase the notice period landlords need to provide tenants from 42 days to 90 days.	Rule change to take effect in February 2021. Notice periods of 14 days and 63 days are allowed under some circumstances.
Abolish “no-cause” terminations of tenancies.	Rule change to take effect in February 2021.
Limit rent increases to once a year, rather than once every six months.	Took effect in August 2020.
Allow tenants to make minor alterations if they return the property to the state it was in at the start of the tenancy.	Rule change to take effect in February 2021.
Set standards that require rental properties to meet standards around insulation, heating, ventilation, draught stopping, and drainage.	Various rules and standards started being implemented from July 2019. Healthy Homes Standards must be implemented by July 2024 across the board.
Ban letting fees.	Took effect in December 2018.
Healthy homes
Assist homeowners and landlords to make their houses warm and healthy to live in with grants of up to $2,000 towards upgrading insulation and heating.	Warmer Kiwi Homes grants became available for insulation in 2018 and heating in 2019. Grants are available to eligible home owners with a community services card or who live in an area identified as low income.
Introduce a Winter Energy Payment for people receiving superannuation or a main benefit.	Payment began in 2018.
Labour/NZ First Coalition Agreement
Strengthen the Overseas Investment Act and undertake a comprehensive register of foreign-owned land and housing.	OIA has been strengthened. There is no “comprehensive register of foreign-owned land and housing”, but Stats NZ is working on collating new data on foreign ownership on top of its housing transfers dataset.
Establish a Housing Commission.	Kāinga Ora established in October 2020.
Labour/Green Party Confidence and Supply Agreement
Make Budget provisions to substantially increase the number of homes insulated.	Warmer Kiwi Homes grants available.
Develop a Rent to Own scheme or similar progressive home ownership models as a part of KiwiBuild.	$23m has been allocated to two community housing providers so they can scale up the progressive home ownership products they already offer.

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Source: Statistics NZ

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Source: REINZ

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44 Comments

by cmat | 16th Oct 20, 12:40pm 1602805204

Surely Kiwibuild should be red.
Sure. Ly.

Also
- Failure to implement CGT in the demand bucket?
- Failure to stem immigration in the demand bucket?

by my2c | 16th Oct 20, 1:45pm 1602809116

More than RED for house section, they actually only built 45 on there own the rest bought of developer lots without even thinking of who would buy them.
Then unable to sell and racked up $70M debt I believe.
But hey that doesnt flow with the agenda it seems.

by Jenée Tibshraeny | 16th Oct 20, 2:18pm 1602811083

Fair points. I added a CGT to the list.

by profile | 16th Oct 20, 4:30pm 1602819055

Emergency housing is a green?! It's up there with coal import growth and light rail fails - but actually hurts people.
"State paid $3000 a week for ‘uninhabitable’ houses - A Newsroom investigation reveals a Ministry of Social Development initiative to provide emergency housing made the housing crisis worse and enriched a small set of landlords and real estate agents.
...The Ministry of Social Development has admitted the scheme made the rental crisis worse – as people took rental properties off the market and used them instead to rent out to MSD to earn thousands more."
https://www.stuff.co.nz/national/300090347/state-paid-3000-a-week-for-u…

by itsme | 16th Oct 20, 6:57pm 1602827827

No good building more houses when the floodgates remain open for immigration. We are just chasing our tails.
We are being conned by all political parties

by MortgageBelt | 16th Oct 20, 12:42pm 1602805356

Why don’t they just build thousands of government houses and place low income and beneficiaries into them - as they did from the 40s to the 90s?
Stop the Accommodation Allowance full stop. Stop putting thousands of people into motel units.
NZ needs plenty of fiscal stimulus anyway & can the take the pressure of the RB.

by Advisor | 16th Oct 20, 1:10pm 1602807029

We will hardly make any headway on affordable housing if, first and foremost, we do not stop low-wage migration into NZ. Low-quality migration is putting more pressure on the limited affordable housing stock and social infrastructure in our high population growth areas.

The 8k new, mixed-use homes that Labour has been promising will be a far cry to resolve the huge backlog as well as fulfill the increased demand from the net migration gain of 38k that Treasury forecasts starting 2022.

by Plutocracy | 16th Oct 20, 1:25pm 1602807919

Too right. It's not hard to see what will happen if you keep bringing in people faster than accommodation is being built. Sure, Covid has given us a pause but if the prior status quo resumes it's not going matter much. We need to limit immigration rates and stop relying on it to bolster our economic data.

by VeryInterested | 16th Oct 20, 1:51pm 1602809476

We also need to take a closer look at tech breakthroughs in building. Is Banging nails into bits of wood really the best way of quickly building housing. 3d printing and machines that can efficiently build new housing is surely worth someone’s time. Technology can get us through this, it’s out there already. No need to reinvent the wheel, we can just tweek it to make it work better for us.

by Advisor | 16th Oct 20, 2:22pm 1602811338

That's right.
In Austria, prefabs made up 30% of the houses built over the past three years.
The main raw material used was local timber and these houses are built to stricter standards than those that apply in NZ.

Replicating their success here in NZ should help build thousands of affordable homes, boost construction capacity, reduce reliance on foreign workers, create more factory jobs, help forestry businesses move up the supply chain, among numerous other tangible benefits.

by J.C. | 16th Oct 20, 2:22pm 1602811345

In Austria, prefabs made up 30% of the houses built over the past three years

In Vienna, most people live in public housing. The cost to benefit / value is far more attractive. Austria is a prime example of a civilized society.

https://www.newstatesman.com/spotlight/housing/2019/09/housing-basic-hu…

by Fritz | 16th Oct 20, 5:39pm 1602823160

Very civilised. Leaves us for dead.

by itsme | 16th Oct 20, 6:59pm 1602827982

Unfortunately, self interest by the wealthy elite dictates how many houses we have.

by Fritz | 16th Oct 20, 5:38pm 1602823130

The only way that will happen is if it is government led. There isn't enough scale here in the private sector to do it.
Some of you may recall Labour saying they were going to invest in prefabrication.
Another lie.
Vote Green!

by Kezza R | 17th Oct 20, 8:33am 1602876815

Vote Green for a substantial increase in mismanagement and nondelivery.

by Gummy Bear Hero | 17th Oct 20, 4:48pm 1602906486

... given that both Labour & the Gnats finally recognize the need for environmental care , for policies which truly lead to " 100 % pure " , where does that leave the Greens in 2023 & beyond ...

Are they just gonna shift even further to the left , with their extreme anti-farming/business/anti-capitalism ideology ?

by sharetrader | 16th Oct 20, 1:46pm 1602809212

the market rents and accommodation supplement, and tax treatment was an encouragement for more private housing stock, it has failed as the stock that was purchased in the main was the same stock of houses that FHB went for, so with the advantages to the investors they have priced the FHB out hence our home ownership rates falling year after year
if they wanted to keep all the advantages it should have been tweaked to only be for new builds, i dont see a problem with investors buying new builds for rentals so that should have favorable treatment.
as for government housing we now need a huge amount as wages have slipped behind and housing costs are taking to much income, we need to go back to go forward

by GV 27 | 16th Oct 20, 12:42pm 1602805362

Hi Jenée, there might be something worth adding here: the 2017 Kiwibuild policy included specific price points for houses which I believe were quietly abandoned after the election.

https://www.labour.org.nz/kiwibuild-2017

"The stand-alone KiwiBuild homes in Auckland will be priced at $500,000-$600,000 with apartments and terraced houses under $500,000. Outside of Auckland prices are likely to range from $300,000-$500,000."

What Kiwibuild ended up with was houses prices virtually identical to the already-existent Axis affordable housing ballots run by HLC. I think these prices were changed shortly after Labour were elected but I could be mistaken - from memory they were challenged on how realistic they were during the 2017 campaign and insisted they were doable.

by unaha-closp | 16th Oct 20, 2:33pm 1602811997

They changed it to $650,000 straight after the election. But then Labour went much further and changed the policy again in 2019, with Kiwibuild acting as a price floor in Auckland at $650,000 to prevent new housing from falling.

by Brock Landers | 16th Oct 20, 3:36pm 1602815766

It certainly demonstrates the calibre of the minds at work here. Their new scheme to underwrite houses that developers "can't sell" will be setting up more price floors to keep house prices high. You couldn't even make up how stupid it has become.

by CrispyKahawai | 16th Oct 20, 12:58pm 1602806328

This isn't nearly as bad as I expected tbh. Despite under-delivering on their promises, they did a hell of a lot more than National would have in the same time period (which is probably nothing).

by DaveB1978 | 16th Oct 20, 1:30pm 1602808212

They put KiwiBuild stickers on houses that were being built under National. There is a trend in that assessment. Anything that required actually doing something didn’t get done. Anything that involved pushing some paper around a desk did.

by Fritz | 16th Oct 20, 1:10pm 1602807015

Wow. That's an ultra generous assessment. Stretching it to say Kiwibuild semi-delivered.
Also the RMA changes are bad for housing - they make residential development riskier by restoring public notification and appeal rights.

by stuart786786 | 16th Oct 20, 1:41pm 1602808877

Kiwi build should be in Red.

CGT in Red

Immigration control in Red

Housing Affordibalty in Red

Earlier were talking about demand and supply but now like National talk only about Supply ignore demand specially speculative and like National now believes that housing crisis is a Good crisis.

by xingmowang | 16th Oct 20, 1:42pm 1602808976

the end effect is that house price in NZ still increase after Labour has "done" what was promised.

This means that, even worse than not getting things done, what Labour promised to deliver are simply the wrong cure for bring down house prices.

by sharetrader | 16th Oct 20, 1:50pm 1602809408

the answer to that is higher interest rates and higher inflation and stopping the flow of money creation , none is going to happen for years, so no government can keep house prices in check unless they want to spend billions building social housing

by DoTheMath | 16th Oct 20, 1:50pm 1602809421

They never wanted house prices to come down, still don't.

by WestieAJ | 16th Oct 20, 2:57pm 1602813457

What they are doing with redevelopment in Roskill South is pretty impressive. But labelling what National had already planned as Kiwi Build. Is as cunning as putting a tail on it and calling it a weasel.

by Kezza R | 17th Oct 20, 8:24am 1602876256

Typical Labour. Do something other than creating more poverty and voter base?? Zero!

by stuart786786 | 16th Oct 20, 2:59pm 1602813550

Wow : Unbelievable - now vendors expectations are too high.

Auction failed - obvious in this market auction is failing only if expectation is as high below :

CV $800000 and now expectation $1300000 for an house on 700sqmt land and is not on Eastern Beach or even Howick.

https://www.trademe.co.nz/property/residential-property-for-sale/auctio…

May be vendor not serious and trying his luck and who knows with reserve bank out in open and every month house prices rising by 10%, may be get the price ( House bought in April in Maunrewa for $620000 sold recently in three months for $808000).

Thanks to Reserve Bank who is adding wind to fire.

by sharetrader | 16th Oct 20, 3:11pm 1602814318

you could have got this for 1.3 million
https://www.facebook.com/watch/?v=713642805884803
https://www.facebook.com/2163414817278197/posts/-new-listing41-thomas-r…

by Brock Landers | 16th Oct 20, 3:42pm 1602816159

Search for what a million dollars buys you in Queensland and weep.

by sharetrader | 16th Oct 20, 3:53pm 1602816832

or in some other parts of NZ but that is also changing as auckland money drives that up to

by HistoryRepeats | 16th Oct 20, 3:25pm 1602815128

Labour have been a debacle. They were deservedly plummeting in the polls before Jacinda got all the free COVID publicity for copying what almost every other country's leader did.

For a shameful list of other fails, see below:
https://www.kiwiblog.co.nz/2020/09/labours_term_of_failure.html

Unfortunately it looks like Labour/Greens will get another term. I'm looking forward to my move to Australia next year.

by sharetrader | 16th Oct 20, 3:53pm 1602816784

thats a very blue biased view so has to be taken with a grain of salt as it is a national party blog the same with other blog sites most come from a supporters viewpoint, if you take the renewable energy he is saying labour are now in charge of the weather,
Renewable shares down due to poor hydro conditions
Most of the country had a dry year in 2019, with a central Pacifc El Niño event lasting from January toJuly. This led to low infows and a three per cent drop in hydro generation from 2018. However, 2019 reached the third highest hydro generation record in the last ten years.
Wind power was used to make up for the low hydro generation, however it was not enough to offset the drop in hydro. At times of low renewables sourced generation, non-renewable sources are used to meet the shortfall between supply and demand. As gas and coal are normally used to meet this
shortfall, electricity generation from gas increase 2.6 per cent, while electricity generation from coal
increased by 43 per cent. The combination of low hydro generation and high coal-fired generation led to a lower share of
renewables in total electricity generation. The renewables decreased from 84 per cent in 2018 to 82.4
per cent in 2019. The share of renewables in total primary energy1was 39.5 per cent in 2019. While wholesale electricity prices decreased from a high in 2018, the combination of low renewable generation and some additional gas production outages saw prices remain high compared to 2017.

by waymad | 16th Oct 20, 4:09pm 1602817792

There's a difference between 'Renewable' and 'Dispatchable'. Wind and solar are not dispatchable: it is not possible to order x GwH of wind for November 13th 2020 between 0400 and 1000. Hydro is both Renewable and Dispatchable (but only down to lake regulatory minima...). Gas, Coal, Geothermal, Nuclear are all Dispatchable so together with Hydro, form the always-spinning backbone of all sensible power grids.

Additions like batteries, pumped hydro etc are net power consumers (they give back only a percentage of input) and are useful for very short-term situations such as frequency or voltage excursions. But they are useless for sustained output. And the economics are horrendous: the more non-dispatchables one plugs into a grid, the more Dispatchable redundancy has to be retained, and their unit costs go oopards as their utilisation compared to nameplate goes south.

Guess who pays....

by profile | 16th Oct 20, 5:17pm 1602821860

With the zero carbon law Labour, National and Greens are arrogant enough to believe they are in charge of the weather - and are taking money off you to change it. It is homeopathy for climate. It would just as effective, and cheaper, to sacarfice a few virgins like the good old days when we were organic and one with nature.

by my2c | 16th Oct 20, 5:40pm 1602823224

Agree with the first part and take it the last part is sarcasm, got to be careful with that as some it seems would like to sacrifice more that just a few and we will get it with these types of policy.
Next policy off the rank will be lock downs for climate it seems, JA will hold onto blocking travel as long as she can I suspect and Green reset.

by my2c | 16th Oct 20, 5:33pm 1602822822

First time at that site, hardly biased just listing the facts in my view

by sharetrader | 16th Oct 20, 10:08pm 1602839324

that site is run by a long time national party heavy weight and their pollster so no way is it unbiased , i have never seen anything against a national party policy or person on that site, and if a comment does go against national he does this, Hidden due to low comment rating. Click here to see.
same as the standard for the labour party , both are a good read (chuckle) to see how no matter how poor the party is going or bad policies they think the other side is downright evil and their side has the right to be ruling party forever
interest.co is the only site that does not come at politics and policy settings with a supporting view of a political party and come at policies from an intellectual and financial point of view, which makes for a lot of interesting thought provoking comments and discussions

by Fritz | 16th Oct 20, 5:41pm 1602823278

There's plenty of lefties, myself included who are very critical of Labour on numerous fronts...

by AndrewRiddell5886 | 17th Oct 20, 7:24am 1602872671

Thanks for this - once again interest.co.nz shows what journalism can be.

by Kezza R | 17th Oct 20, 8:31am 1602876707

Green painted everywhere but we all know that Labour has not delivered! In a country of pine trees they couldn't build timber houses. On an island they couldn't contain the boarder and to make it worse didn't admit blame and attempted to pin it on something out of their control.
Transformational Govt??? Not at all, just more liers that can not proform. Same same BAU.

by Firstclass | 17th Oct 20, 5:43pm 1602909831

Marking the "Build 100,000 affordable homes for first-home buyers over 10 years via KiwiBuild." policy yellow insults the intelligence. Sadly, that was a total failure from Labour. Red is the only colour for that weak effort.

A housing stock-take after three years of a Labour-led Government - what was and wasn't delivered

Building consents - type

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Median price - REINZ

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44 Comments