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What I should have said on foreigners buying houses

  • March 1st, 2013

Marcus Lush recorded an interview at 5-50am this morning with me on the pros and cons of banning foreigner purchases of houses here. I always enjoy RadioLive interviews, because they rarely try to fit me into a stereotyped slot. Both Brigid who last night set up the interview, and Marcus, sought fresh information. That contrasts with the predictable Punch n Judy show statements sought by others. 

As sometimes happens in a genuine conversation, I realised that the issues could be summed up simply. Prices go up when supply can't increase to respond to demand. There is no a shortage of building supplies, or builders. So foreign buyers' money can only affect prices if there is a shortage of land to build on. But New Zealand is not short of land. It is short of consents to use land. And probably more important than the supply of new land, is the cost, delay and risk in trying to intensify the use of land that is already built on, nearer the centre of our cities.

In other words, our housing problem is the inevitable consequence of the political success of selfish middle and upper class families, working with their stupid green children. They enforce their aesthetic preferences for the status quo (labelled as 'heritage') by locking newcomers out of their leafy and quaint inner suburbs. The RMA has frozen the dynamic processes of rebuilding and intensification that have created all great cities (and our own towns and cities up till 3 decades ago). The result is that poorer people must pay for more expensive housing ever further from where the work is.

To blame the resulting prices on foreign money is a nice distraction from their own culpability, for the selfish generations, and the councillors and MPs who pander to them.

It is 7 years since I was an ACT member, but I have to commend the Freedom to Build solution offered by John Banks and ACT in this area. It is the most plain, simple speaking any politician is offering.

Still, if central government can't summon the political courage to solve that problem, then restrictions on foreign money might mitigate the problem temporarily. If so, any restrictions on investment should be confined to:

a) Auckland (because sellers and builders of houses in most of the country would love to have a deeper market of buyers);

b) Existing houses (so that new money can go into increasing supply); and

c) Houses kept empty (because a house occupied is part of supply, whoever owns it).

Comments

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  • AngryTory
  • March 2nd, 2013
  • 8:34 am

middle and upper class families, working with their stupid green children. They enforce their aesthetic preferences for the status quo (labelled as ‘heritage’) by locking newcomers out of their leafy and quaint inner suburbs

And what the f**k is wrong with that?

I paid well for my “middle class house in a leafy suburb” and have no wish to have my assets chopped in half by libertarian economists apparently out on some strange Labour/Green-party inspired kick to lower housing prices! Nor do I want my “leafy” outlook over my neighbors yards – outlooks that were priced into the bid I made to get the house – ruined by communist-inspired “infill” housing designed to use up excess capacity in streets and local services.

The answer is: anyone with a good job can afford a nice house in Auckland, Sydney, London or New York. Our parents worked damn hard to set us up in life, and we’re doing the same for our kids. Why punish the few actually successful property-owning Kiwis – people who want to vote ACT – to help beneficiaries and WFFers into houses they don’t deserve.

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  • Colin
  • March 2nd, 2013
  • 12:55 pm

AngryTory

Your naÔve ill informed comments beggars belief

I am alright jack everyone else can go to hell.

New Zealandís massive indebtedness can be directly attributed to an insanely overvalued housing market. So letís just keep going down the current road until it all falls over great policy and governance.

Affordable housing is a human right not just for the rich

http://www.nbr.co.nz/article/standard-and-poors-warns-against-nz-property-

Gravatar
  • AngryTory
  • March 2nd, 2013
  • 1:52 pm

Affordable housing is a human right not just for the rich

Oh get a grip. Whatever human “rights” may be, “affordable housing” is not one of them. NZ housing is quite affordable – if you’ve any real wealth or income, there is absolutely no problem buying any house you want anywhere in NZ. Even if you’re on WelfareForFamilies, Realestate.co.nz shows 555 listings under $200,000 in Auckland today.

And we have paid for it – When Grammar or Girls Grammar goes to charter status in 2015, that’s $150,000 to $250,000 off the value of our houses!

If ACT did something that would be useful for the truly valuable nett taxpayers, like ending the totally unsustainable benefit & health system, ending NZ super, or ending FBT – then it might just gets some more votes.

A “right to build” might be fine on city fringe farmland, but in high-value communities – please. It’s a privilege to live in central Auckland, and ACT of all people should remember that!

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[...] Stephen Franks blogs: [...]

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The reason I write here is because Stephen Franks has much to say, even at 5am in the morning to a Southlander. But do not think for a minute that we will change here in Christchurch, no not at all, we are spending future money as fast as we can, we have caught on to the trick that all of you have to pay for our recovery, and by God we need a convention centre maybe $150 million and maybe a sports covered stadium. You people NZ need to pull hard together so that we can get what we want. Do you remember the rail system $900 million that he invented, I mean the Mayor mad himself invented , no probably not that was another day, excuse my bitter days in Christchurch.
We people of Christchurch have risen always every possible barrier to any persons dream of owning a home and being able to renovate that home for family . That is what we did in Council Christchurch. We the people opposition had a spruiker here his name Hugh Pavletich but I suspect he moved onto better pasture.
Our roads our rough and vile, and if anybody is mad foreign t to buy my house I will sell.
Paul Scott

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  • Colin
  • March 4th, 2013
  • 3:13 pm

AngryTory

Get real with your stats

“Even if youíre on WelfareForFamilies, Realestate.co.nz shows 555 listings under $200,000 in Auckland today”

I think you will find 80% of your 553 listings are in fact sections and 75% of the balance apartments or action notices.

The housing marketing is a mess buy some commercial property if you want to protect your wealth.

[...] I’m a bit late to the party here but Stephen Franks is right on the money when it comes to identifying the “class” responsible for high house prices in our big cities. [...]

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  • Mike Mckee
  • April 30th, 2013
  • 9:07 pm

Sure they want to keep the value of their properties but so do the taxing authorities, namely the city councils.

They are the ones with their hands on the throttle, not releasing land, nor making it an easy, seemless and cheaper process/environment to develop same.

Central govt not releasing monies for regional infrastructure, rather happily spending it on welfare instead of infrastructure and consigning those on it to a life of underachievement for political gain.

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