Labour Party leader Ardern maintains stance that existing house values shouldn't drop as KiwiBuild increases supply of cheaper homes

By Alex Tarrant

Labour Party leader Jacinda Ardern is maintaining the stance that ramping up building rates of more affordable housing by way of Labour’s KiwiBuild policy won’t necessarily impact values of existing properties.

“People keep looking to their own values, but actually you can bring in affordable housing without having that strong dent in peoples’ values,” she said on Radio NZ’s Nine to Noon show while being interviewed by Kathryn Ryan.

Like National leader Bill English’s interview on Wednesday, Ryan’s piece with Ardern was possibly the toughest the Labour Party leader has faced this campaign. Below is the section on Labour’s housing policy, and on the proposal to set up another Tax Working Group.

Building cheaper houses

Ryan put to Ardern that the median house price in Auckland was now over 10 times the median income. What would Labour do to alleviate pressure in the housing market.

Ardern said it was clear the Auckland housing market had failed, and that there was need for intervention. Building affordable houses had to be the go-to now for a government. She herself raised that this had led to people asking what this would do to existing values.

“Actually, part of the problem is that we don’t have enough homes being built in that affordable range,” she said, adding the average being built in Auckland was closer to 200 square metres, whereas it was 100 square metre starter homes that were required more.

“We believe that by building at cost, by having pre-fabricated housing, building at scale, making sure that you’re doing centralised planning, by having the Crown involved, we can help bring down those costs. We on average are aiming for homes [at] $400,000-600,000,” Ardern said.

So why isn’t everyone doing it now if it were that straightforward, Ryan asked. She put to Ardern that government’s housing construction pipeline report was indicating the industry was at its limits and that new builds couldn’t keep up with targets. Wouldn’t that affect Labour’s KiwiBuild programme?

Ardern said Labour wanted more skilled construction workers entering the industry. Estimates indicated an extra 5,000 people required to help lift build rates. Skilled migrant labour would also be required. There were young people doing pre-trades training already, although she argued there weren’t enough apprenticeship places for them.

Ryan put to Ardern that new affordable houses would only stay affordable if new supply kept coming on the market that was sufficient enough – otherwise they would just rise to the market price. This indicated things aren’t going to be as straightforward as it sounds.

“It is a complex issue,” Ardern replied. She added though that this mean other measures were required on the demand side as well – Labour was talking about foreign speculators and cutting off negative gearing. “Our frustration has been that the government hasn’t really tried on any of those measures,” she said.

Ardern linked the issue to Labour’s forestry policy. “Why aren’t we milling in Gisborne and creating those pre-fabricated houses here within New Zealand to try and help get the pace of build that we need?” Labour had set out an ambitious programme because housing was a right.

On demand side measures, Ryan raised the move to extend the bright line test from two to five years. Was that going to deter anybody from buying for capital gain, given how house prices had kept rising after the rule was first imposed?

Ardern said the reason Labour was proposing an extension to five years was because, when it was debated in Parliament, this was what officials had recommended. And this was the reason Ardern took a “political risk” to announce she wanted to do extra work on whether this was far enough.

Ryan asked what rate a potential capital gains tax might be set at – 15%? 33%? That’s the question that will be put to Labour’s Tax Working Group, Ardern said. Land tax as well? “Nothing that’s going to affect the family home.”

“My premise going into this was, I want to know what will make the biggest difference on home ownership and lifting those home ownership rates. People want that question on fairness answered as well,” she said.

Ryan put to Ardern that National had nine years to answer for, for its time in government. But Labour equally had nine years to come up with a tax policy. Why another tax working group instead of having this pegged down like before previous elections?

Things had changed since Labour’s last manifesto, including the introduction of the bright line test, Ardern replied. In part, she had also only had seven weeks in the leadership role. “I knew what I wanted to tackle as leader. What felt really important to me was that home ownership question. I wanted to do that over the next three years in office.” But she’s also listened to people who were saying they accepted the urgency, but wanted certainty. “So over the course of the campaign I’ve found a way to balance the two.”

Existing valuations

What would success look like in the housing market under a Labour-led government? Ryan asked. Lifting home ownership rates, came the reply. Ryan asked again – given the 10x situation in Auckland, what would success look like if Labour’s policies worked?

“Increasing the number of homes that are in the $400,000 to $600,000 bracket does bring that down…” Ardern said. Ryan jumped in – you can’t break out parts of the market from each other. Ardern continued that the lower end of the market was where the failure had been, meaning success would be judged there.

“People keep looking to their own values, but actually you can bring in affordable housing without having that strong dent in peoples’ values.”

Ryan put to her that if someone had bought for $800,000, and then a similar house was now being sold for $500,000, a buyer wouldn’t consider the higher priced one. She said that if there were still a shortage of houses, then these affordable ones might rise in value towards the market price once sold by the government.

Ardern said Labour’s policy had checks in place, including that for someone looking to sell a KiwiBuild house within a certain timeframe, the government would have the right to bring that back into its stock.

Again, Ryan raised the person who had bought earlier for $800,000 – they were likely to see their value decrease if potential buyers of that home were now offered properties at lower prices. Ardern replied that the KiwiBuild pocket of housing would always remain within the affordable bracket.

“The reason we’ve taken this intervention, and it is a big intervention to make, is because at the time that my parents bought their home in the 1970s, we had the highest home ownership rates, really, in the developed world. It is within our reach to get back to that place. But we are going to have to do things differently,” she said.

But what would it take to get back to that place? Ryan asked. She put comments from economists Don Brash and Arthur Grimes – also former Greens co-leader Metiria Turei – that a 40% decline in house values would be needed to get affordability metrics back into normal territory unless you were to wait decades for incomes to catch up. Was Labour prepared to accept an outright decline in house prices in order to rebalance the situation?

“That is not what our plan and agenda has been built around,” Ardern replied. “Our view still is that the market failure has been just that there is not that quantity…” Ryan jumped in: she couldn’t just reinvent economics. “I understand what you’re saying, but that’s where the deficit has been,” Ardern said.

“What I do not accept is that, I’ve sat in front of a Select Committee where Nick Smith’s…plans around affordable housing is, simply that you don’t create any in that band, you let the market just continue to work the way it’s working, people will sell up their affordable homes to take on the new ones that are being built in his affordable housing area, which aren’t technically affordable, and we just have a trickle down. That I don’t accept,” she said.

New Zealand needed to accept we weren’t building houses in that range. Part of it was our planning rules, and part of it was no one was building at scale, Ardern said.

Immigration

Part of Labour’s criticism over the demand side had been that house building wasn’t high enough to cater for immigration growth, Ryan put to Ardern. So, was Labour going to control migrant numbers?

Ardern said Labour’s policies would have that impact. They had not created a target number, rather the 20,000 to 30,000 reduction was an estimate of how many fewer people might enter the country every year due to Labour’s planned crack down on international education visas for below-Bachelor level qualifications.

At the same time, industries with genuine skill shortages – like construction and aged care – would be allowed to bring in skilled migrant workers just as before, she said.

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

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88 Comments

She may well be correct in this assertion if :-

1) A Labour Government does NOT HIT THE PAUSE BUTTON on immigration
2) She does NOT stop foreign speculators and ban them
3) Ensures Auckland is NOT able to expand outwards
4) They DO NOT discourage private capital from providing rental stock
5) A Labour Govt admits it conned the electorate into believing it would actually build 100,000 new homes and give everyone an affordable house , and uses the excuse that there is simply not enough money , land and workers to actually do this at anything like an affordable price

You could also have said that Billshitter had an epiphany a week ago and acknowledged he knew about the housing crisis before anyone else, next week he will claim he was taken out of context

That guy is a train wreck

Or if they do do things to improve housing supply or reduce demand, and also go to highly inflationary approaches like printing money to pay for all their spending promises.

Haha unbelievable. If she became the leader a month earlier the current polls could be down to Andrew Little’s level as the inexperience and the lack of basic econ101 is just astounding. It looks like she’s the one needing the free tertiary education on the basics.

Everyone has a whinge that house prices are too high, but at the same time have a whinge if prices drop and knock value off their own homes? What do you want, fair house prices but just make sure yours doesn't lose any value?

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So much self interest. The ponzi must end.

which is exactly why the government should establish a group which has no political affiliation to make this call.

ironically, a working group

Everyone has a whinge that house prices are too high, but at the same time have a whinge if prices drop and knock value off their own homes? What do you want, fair house prices but just make sure yours doesn't lose any value?

Yes and that is what Cindy is effectively answering by inferring that that she will turn water into wine for the young and the poor, while preserving the riches of the battlers. Not once has she or Bill English addressed the wider issues of the impact of the "bubble" should it stall or retreat. Gareth Morgan has to some degree, but the average NZer seems to perceive him as a well-meaning eccentric, but a bit too radical to be taken seriously.

Not once has she or Bill English addressed the wider issues of the impact of the "bubble" should it stall or retreat.

I suspect that scenario modelling work is being done by the Reserve Bank. I do wish such modelling was made more transparent to the public. Where's our dashboard;

http://www.scoop.co.nz/stories/BU1702/S00408/rbnz-to-continue-engagement...

That whole initiative seems to have gone all quiet - or did I miss something?

I don't know Kate. Dashboards are great but they're not exercises in modelling. Nevertheless. I think that very few resources of central banks are dedicated towards modelling the impacts of asset bubbles and the resulting impacts after they sour (assuming that they do). The reason for this is that the complexity is too great and entirely related to the behavior of the individual and the h'hold. For ex, how you quantify and aggregate savings and spending within an economy if house prices were to fall by 10%? Too many hypotheticals need to be accounted for.

Yes, I should have made the differentiation and said ... and BTW, where's our dashboard?

http://www.interest.co.nz/business/85279/bank-lobby-group-says-no-thanks...

I hold to the opinion that the core issues are probably complex enough that the simple fixes won't impact the market enough to cause any sizeable crash (more than 10% in real terms over 12 months).

In that view that fact the cure takes a little while is a good thing. Even though punters might clamber for immediate actions.

Not talking about fixes. This is all about impacts. It's very important to realize that asset bubbles have a strong impact on the health of the wider economy. Bill English would say "house prices are the result of a successful economy." Another reality would state that it's the other way around: "house prices are driving the success of the economy" (not necessarily the sole driver, but if a bubble as as big as the NZ housing market is not having a positive impact, then it will be the most unique housing bubble in economic history).

Cheers J.C., I am sure whoever wins government on Saturday will want the bubble to make no sudden moves.

For a long time in NZ it was common to hear the view that house prices never went down, they just plateau for long periods. They meant in nominal terms.

Part of the challenge this time is an inflation backdrop that currently shows no sense of co-operation.

Yes, And that's why Don Brash suggests if prices "plateau", it will take about 50 years for incomes to catch up.

There isn't much political experience in leading an electorate through anything other than the 'plateau'. So I expect any other outcome would be driven through externalities.

Yes, I completely agree. The externalities are extremely important, but their eventuality has been completely ignored. No need to terrify the sheeple will be the strategy, but I wonder if Cindy and Bill are even remotely aware of what form they will take.

Probably not, but I am not sure that matters. A useful level of preparation should suffice.

"In preparing for battle I have always found that plans are useless, but planning is indispensable." - Dwight D. Eisenhower

No attempted fix will work quickly or within a few months. The bubble has been built up because of immigration, speculation, shortage of men and material, shortage of consents, bank lending, media build up, etc. Even if all these are corrected now, it will take at least 2/3 years for a semblance of balance to show up. But who is the best placed to make a start, is the big question of this election. Voters will have to go with their guts on that..

Equally I think there's been a real lack of desire to fix the problem because of the personal financial gain involved to voters and politicians (by doing nothing - or actually by making the situation worse via immigration and lack of policy to stunt price growth)...we literally have the blind leading the blind towards a cliff...

Equally I think there's been a real lack of desire to fix the problem because of the personal financial gain involved to voters and politicians (by doing nothing - or actually by making the situation worse via immigration and lack of policy to stunt price growth)...we literally have the blind leading the blind towards a cliff...

Precisely. That's why bubbles are tolerated. Personally, I don't think bubbles should be snuffed out because the realization that a bubble is actually a bubble isn't obvious until after the fact. However, the "promotion" of bubbles is wrongheaded and that is what is happening in both NZ and Australia.

Does anyone actually believe this is a credible plan?

How desperate. She is now in trying to pander to and reassure "Joe public".

Also a desperate set of measures to try and control the uncontrollable. Its a bit like putting a curfew on an out of control teenager and believing you are going to achieve success.

Just like the entire Labour campaign - a series of disconnected, embryonic thoughts with no substance. Nine years in opposition (shouting the odds) and no real policies. Lack of experience and credibility coming through strongly.

We have endured nine years of do nothing National "leadership". if you think the Key/English track record on housing has been superior to what Labour is promising after Sat, then you have lost touch with what the issues are in Auckland.
If Labour do just one thing, namely to eliminate foreign buyers from the RE market (undoing the ridiculous arrangements in Nationals last free trade agreement), then that alone will help significantly.

You're dreaming @Macadder...... of something that has been thoroughly discredited, namely a centrally planned economy. We don't have one, but we do have a housing market that has been disrupted by intervention (RBNZ) and lack of, or inhibited, free market drivers. This includes RMA and local government in Auckland in particular operating under a Labour flag not freeing up new land for development.
At least National are working to address the supply side of the equation in a meaningful way.

The simple fact of the matter it that the National government have deliberately ignored the demand side of the market for fear of upsetting key National party donors and a portion of their constituency. A tsunami of mainly Chinese money has disrupted the Auckland and other Pacific rim city RE markets for several years. Your inference that the the problem is just one of supply is laughable.
National have had 9 years to sort it out - they have achieved nothing on the supply side as well. They kicked the can of who pays for big ticket infrastructure to facilitate more housing down the road. They have been successful however, in filling Auckland up with overseas born retail managers, petrol station attendants, 2 dollar shop workers, takeaway chefs and other sundry critically needed workers. Haven't met many "fresh off the boat" builders yet.

What nonsense. This isn't how economics work. This is wishful thinking where a fairy godmother can grant everyone's wish. If we want affordable houses prices must come down - everything else is a lie.

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And they will, but it won't be as a result of either political party winning or losing an election.

This is quite true, and also quite saddening.

"This isn't how economics work." (sic)
Is it sort of like Wild Bill's assertion that the best way to increase affordability currently is with a new subsidy?

But, in actual fact, it is entirely possible that an increase in supply of low end property doesn't bring down all property prices. It depends on how you believe the market to be structured. If you take your simplistic view that all houses are the same and thus we have one aggregate demand curve, then it isn't logical.
However, if we take the perspective that the property market is a well differentiated market with a fixed amount of people with an non adjusting WTP, it is entirely possible that an increase in supply of affordable housing wouldn't affect prices.

So, her theory has some merit. Which is, ironically, more merit than your assertion that "This isn't how economics work."

Nymad - exactly

Supply and demand - more supply same demand means the price goes down. The only way for lower prices for new houses but maintaining current prices is for those new hoses to be built outside Auckland. Housing is not like goods where it is possible to build, for example, a lot of Toyotas and have no effect on the price of a Ferrari. If an additional dwelling is built in a street it will affect the other houses - better or worse. The value of a house is determined by many factors but a big one is location. Is she planning to build in Pokeno?
Also, let's imagine that I am wrong - what she is saying is that she will build cheaper houses than the current ones on offer now. If isn't going to affect the market (house prices won't fall) then it will mean those new houses will have to be worse than those on offer now - either in location (Pokleno again), quality, or some other factor.

Alex, you must be dissapointed in Jacinda's comments that house prices dont have to fall?
Her lack of understanding of basic economic principals such as supply and demand, pretty much up why we shouldnt vote Labour into Government. You wouldnt want her to make any "Captains Calls" on anything economic- scary!

It also depends upon what is in the demand/supply equation. It's not 'houses' that determine the price structure of the property market, but the ability to pay. If "Chinese' money stops, and locals can't borrow the money to buy ( for whatever reason - LVR's, or bank access to foreign funding capital etc) then it doesn't matter if there are 1000 'buyers' for each 1 house; it only matters if that 1 buyer can pay for it.....

True, but this is the conundrum for anyone looking to supply new affordable stock i.e. how do you balance the supply and ability to purchase? It's no use building houses where buyers can't afford them and it's problematic supplying a market where the demand exceeds the supply as any decision to sell below market price will necessarily create winners and loser whereas a sale at market will likely be less affordable.

It has seemed obvious to me for some years that the two main parties have been to fearful to state the truth that house prices need to fall to improve affordability. They rightly know that the average Kiwi voter (more so in Auckland) is a selfish creature at heart and will not take kindly to seeing their newly acquired paper wealth eroded. It's best if someone else property drops in value, not mine thank you very much. Politically acknowledging this hypocrisy is an election loser.

Yes - this is why I'm going to take some satisfaction in seeing the housing market and National party fall to pieces if/when reality hits..

It is rather amazing that some put forward the affordable housing for all argument while stating that their goal is not do reduce existing house prices, as it is rather obvious that the direct result of this is that existing house prices will (and must) decline in order to improve housing affordability. The first candidate that states this quite obvious conclusion will get my vote regardless of party. That is despite my current house being equivalent in value to the median Auckland price...

The blanket statement that any CGT will not include the family home removes the majority of properties in the country from consideration for CGT. I know quite a few people that are flipping their family home every year or two without any CGT being levied. This is a silly state of affairs.

" I know quite a few people that are flipping their family home every year or two without any CGT being levied. This is a silly state of affairs." - why is it silly ? please explain what is wrong with this in your view .
I know a few people like that myself ; most of them carry out substantial improvements before they sell out and move on ; it seems pretty hard work and a tough way to live to me .
It is a (the?) traditional way to climb the housing ladder . Why do you think it should be discouraged ?

Why do I think it should be discouraged? Three words... house price bubble

A few words of explanation. A symptom of house price bubble formation is the number of people doing "remodeling" and selling within a year or two of purchase. The real gain is via basic appreciation, and the remodeling is just eye candy that is intended to add appeal during an open house. Usually, the remodeling is lipstick on a pig, granite countertops, new paint job, new built-in appliances in the kitchen, etc. You know, the stuff that makes a house show well during an open house. The factual increase in value in the home is rather small, it is just putting make-up on the house for the quick flirting during an open house... I am guilty of this as well, I did a rather large amount of remodeling two weeks prior to selling my last house. In a rational world, this quick make-up shouldn't increase the value beyond the upgrade expense. But, in an elevating market, this stuff adds extra value.

In my opinion, the amount of work put into the remodeling is just that, "work". If it results in an income, it should be taxed just like when you work for an employer. I have similar arguments in regards to income that results from capital gains, despite the fact that the majority of my income is currently not earned income. I'd have to work far too hard nowadays in order to get my earned income to be above my passive income despite my hourly rate being more than an order of magnitude above the minimum wage.

What you say is fair if you assume that only / mostly cosmetic work is carried out . Certainly there is quite a bit of that going on - but I also see a lot of extensions etc. that add "real" value and add to overall housing stock available. Most people doing this are not rich and put in a lot of time and effort into it ; a commercial developer would not dream of tying up the capital in small projects like those while the permits etc.etc. are being sorted out so discouraging it would only restrict supply further..
I do not agree that any profit from this should necessarily be taxed in the same way as wage income - a wage earner is not risking his capital when earning his income and can never make a loss ( which is very possible to do when doing building projects ).

Agreed about the relative risk. By the same token, there is the very real possibility of earning an outsized capital gain, far beyond the value of materials and labor that was invested. This risk vs reward aspect is why some people gravitate towards the remodel work involved. Just because there is a risk of no reward does not equate to the fact that there are likely to be gains, and on average, higher gains than the equivalent effort put forward in a wage job. These earnings should be taxable in my view. There is an argument is to whether some capital gains should be taxed differently than others. In the US, there is a two tiered system for capital gains. Any gain that occurs in a year or less is taxed the same as earned income. Gains that occurred over a longer period of time are taxed as "long term capital gains" and is taxed at either 15% or 20% if one is quite wealthy. Interestingly, if one has very low income, then long term capital gains are not taxed at all. In other words, a progressive capital gains tax, which seems to be a good idea to me.

I do like the 2-tiered CGT rate they have in the US .
I note however that it is not applied there to any gains ( up to 250K USD ) on one's primary residence ; in fact I am not aware of any country with a CGT where the family house is not ( at least largely ) excluded from the CGT.
I think the strongest argument behind that is to avoid having an effective tax on moving house ; I have never seen this argument refuted . What is your view on this ?

The US rules require one to live in the house for at least three of the past five years in order to get the limited exclusion. This has some additional caveats as well.

I'm okay with a five year bright line on the family home. Without some timeline, the simple methodology is to live in the spec house for a short period of time, and claim the exemption when you sell so as to avoid any taxation. I know a few builders that do this locally. You know, that real estate ad that says "builders own home"... just another tax dodge method. Build a house, move into it for a year or two while building the next house... and you get your income completely tax free.

Some kind of qualification of family home exemption could perhaps make sense. The devil is in the detail of course ; 3 to 5 years bright line test seems like a reasonable idea.

Should we remove income tax on C.E.O.s?

anyone would think both the leaders of our major parties have no understanding of economics. I think they do and it's all smoke and mirrors to either lower house prices without saying they will (labour), and keep house prices going up while telling people they won't go up further (national)

You might be giving Jacinda too much credit - it seems to me that she believes what she says on the housing issue .

Why do you both think Labour's policies will lower overall house prices, or intend to lower overall house prices ? That is a flawed view. Please provide the rationale for your view.

As Nymad explains above, provision of affordable Kiwibuild houses would only be one part of the market and would unlikely have much impact on the middle / high end of the market.

Reducing foreign speculation is likely to reduce house price inflation, but unlikely to lower prices - especially, as you are National Party supporters, you presumably accept Bill's view that foreign buyers make up only 3%.

I do not think their policies as they stand would bring the prices down - never said that .
Ban of foreign buyers is at best a marginal measure which cannot be enforced effectively.
Kiwibuild will be vastly over budget , over time and will suck out resources from the private building industry the result being much the same level of supply ( but higher government deficits ).

OK apologies if I misinterpreted you.
What is your basis for claiming Kiwibuild will be over budget? Surely some budgetary control can be achieved by mass prefabrication?
Also, if it does suck out some resource from the private sector, then my view on that is that it is better that affordable homes are being delivered for middle income kiwis than higher value homes being delivered, a lot of the time, to investors/speculators.

"What is your basis for claiming Kiwibuild will be over budget? Surely some budgetary control can be achieved by mass prefabrication?" - I think Labour promises in that area ( 400-600K houses in Auckland ) are simply unrealistic ; they moved that target already and would have to do so again. As to pre-fab etc. etc. - all pretty good ideas in theory but take time and ( rather a lot of ) regulatory changes ; I do not see them getting this off the ground nearly fast enough .

Indeed. The hurdles for prefab builds include:

  • The need for a 10-year build guarantee (IIRC) by the prefabber, with associated insurance and backstopping costs
  • BRANZ attitude to any new materials certification - many tests, several years, mucho pesos
  • The existing Materials Cartel protection of 'their' patch - they can reasonably be assumed to throw various rocks on That path
  • The limited number of actual Jobs (especially unionised), as factories tend to be highly automated and work around the clock - won't appeal to the blue-collars seeking work in 'em - or their puppet-masters
  • And the land prices underneath are still foobarred by the brown-cardy set via Plans which limit supply, inject Time and thus Cost to development, and which change at glacial speed.

Just imagine the reaction of the current playaz to an announcement like This (thought experiment alert!)

"We are prefabricating a Hoosing Factory offshore. It will be highly automated, needing only a few top-flight technicians to keep it running. It will arrive onshore in October and will commence operations in December. The houses produced from this factory will use materials proven overseas but new to NZ, will be manufactured to sub-millimetre tolerances, will be built under cover, and assembled in 2-3 days on site by an experienced crew using battery-operated tools. The factory is expected to have a throughput of 20 houses per day, and will operate 20 hours per day for 360 days of the year. Maintenance crews will be flown in for a 5-day upgrade and maintenance window. Unit costs for the houses thus produced are expected to be in the region of $800/square. All houses will be serial-numbered and will come with a 20-year guarantee of weathertightness."

Ah, we can dream.....

Always enjoy your perspective Waymad

Its all getting clearer now as to who we want at the helm to steer the economy as well as the social issues we currently have. From the choices we have, its obvious we want Bill & Co. None of us are perfectly perfect but I hate to imagine where things would have been if we had the current Labour at the helm for the last 9 yrs, a good portion of it being "difficult" years--with GFC to PIKE RIVER to A LOT OF QUAKES and everything in between them. IT would be nice to have a good OPPOSITION.

Pike River?????

Yep, it takes real leadership to pull this sort of thing off - http://www.scoop.co.nz/stories/PA1709/S00203/government-cover-up-of-vict...

I take it you are being sarcastic?

Bill and co on social issues????
Cough, splutter...
Rising homelessness, growing inequality, child poverty, horrendous worsening of housing affordability all on their watch.

Unfortunately she is pandering to boomers (I am one) who now are in self delusion mode and think that having average house prices 10 x wages is normal and preferable. It is just not sustainable. Gravity always wins in the end. Only huge immigration or open market on purchasing houses from overseas is keeping the market afloat. First time buyers are out of the market. Beware when it is just investors buying off each other. I think they call it a pyramid scheme.

Not even so much migrants as many of them live in houses with numbers of occupants in double figures. I am pretty certain that the sky high prices were driven almost exclusively by foreign investors, of one particular flavour in the main.

AuckFHB agree, agree, and agree. That's why pretty much every Auckland I have spoken to recently is voting for this to change. There was one who want ponzi model and immigration to continue, but hes so strung out on the ecstasy of how much he will make when we hit 20x income (read in massive massive property debt leverage) he can hardly be called impartial.

Prices are starting to go down in Auckland now, from what I hear agents up there are saying that the market is really bad and will only get worse.

Once again Jacinda lacks depth, she’s not ready to be PM and if she got in she would be the disappointment Trudeau has been in Canada now reflected in the polls there. A one term wonder in before they were ready.

Please provide a link to where you are getting your info. It seems the Liberals are doing just fine according to this story - http://www.cbc.ca/news/politics/grenier-federal-polls-taxes-1.4296602

I'm a better judge of character than you Mr P. King (from what I can infer from your posts) and she is likely to make a very good PM.

I'm better at tennis than you Maccader (from what I can infer from your posts)... lol

I'm better at spelling.

I've been looking at houses in the Ponsonby area for the last 2 weeks, wondering if there was any "value" that could be picked up. What a shock, now you have to pay $2 Mill for a house that needs lots of work on a small section, $3 Mill if it's in need of work but on a biggish (560 m2) section or renovated but on 380 m2 of land and I saw an astounding 5.4 Mill on Ardmore St for a nice renovated house

Everyone wants 3 beds in mission bay with a backyard for 500k

Everyone wants housing which is not the most expensive in the world compared with incomes. https://www.economist.com/blogs/graphicdetail/2017/03/daily-chart-6?fsrc...

No they don't but if this is how you manage your conscience, then so be it.

I've told you ten trillion times, don't exaggerate.

It's only every second person.

Spot on Nimbo, or Ponsonby

Why cant they just admit Auckland house prices need to and will fall!!!!

Horses are still way too skittish

Have you ever tried telling a spoilt child that there will be no dessert tonight?

Let me try :
"Independent_Observer - you will not be able to vote yourself a free or cheap house at the expense of others ".

Hahaha best comeback of the year !!!!!!!!!!

And out come the selfish children....hook, line and sinker...

Melbourne's house price is far more reasonable then Auckland's.

Why is that?

Yes and the sun rotates around the moon

So Jacinda wants to build these affordable houses in the $400k to $600kand I take it that includes the land.
So I suppose these 100m2 hardiplank boxes are on 200m2 sections out in the wop wops!
Cost a packet to commute into Auckland but then the ones she will be looking to build for probably have no desire to work anyway.
So the 600k houses would need a 120k deposit and therefore at 480k mortgage.
The repayments based on 30 years at 2 years fixed ANZ are 612 per week plus rates and insurance say another $100 per week so over $700 per week.
So this is what Jacinda says is affordable for her people?

Use your imagination.
If they are on govt land, then all sorts of things can be done to assist affordability, including leasehold title

Considering the policy proposal is a few years old already surely those creative solutions should have already been put forward to be scrutinized by the public ? If they actually do exist that is . .

It's cute people think National is on the front foot here. Best case scenario for Bubble o Bill is a coalition with NZ First, and considering they have much the same platform as Labour this election will show a shift towards red politically and a shift towards the red in house prices.

I think it is clear she believes like a true communist in centralized planning and house building.
Lets hope she does not try that on our food industries otherwise we will all be starving in 12 months time just like the failed Soviet Union. The worst case outcome will be some unhappy starving radical will try to solve the problem in the traditional manner.

Property investors never cease to amaze at what a selfish blight on the country they are.
The best performing economies in the world like Germany do so well because they keep property investors on the short unproductive leash they deserve to be on.
Hence why NZ has had such a lack of real productivity of late, and has had to rely on fake growth by massive immigration.