Housing dividing society

New Zealand is quickly becoming a society divided by the ownership of housing and its related wealth, an independent stocktake of the country's housing sector has found.

Released yesterday by Housing and Urban Development Minister Phil Twyford, the report confirms everything the minister warned about during last year's election campaign, and more.

Even allowing for the political bias which may have skewed some of the findings, despite the so-called independence of the report authors, there are some sobering results.

There was a housing crisis before the election but the previous National-led government only started to address an acute housing shortage once it became an issue during the campaign.

Labour and National raced each other to the same venues to announce special housing projects in a somewhat comical effort to prove they were genuinely caring about the fate of those forced to rent or the homeless.

House prices have surged in New Zealand in recent years, well above the rate of inflation. Stories abounded of houses earning more a week than their owners as properties were sold on quickly again and again.

The shortages have been most acute in Auckland, Tauranga and Hamilton, but there has been a flow-on to other areas.

Home-ownership rates have fallen to the lowest levels in 60 years. House-price inflation over the past five years has been around 30% across New Zealand overall, while incomes have risen by half this rate.

The increases have had two sorts of impacts. For first-home buyers they present obvious barriers to entering the market, which have been added to with lower loan-to-value ratios.

On the positive side are historically low interest rates which have made housing costs for all indebted owner-occupiers lower.

Labour promised to build 10,000 houses a year before it became the government but so far none have actually been built. An online counter shows the Government is already 3000 houses behind.

While Mr Twyford can talk about the sobering stocktake on housing, there needs to be some action or he will face the same criticisms levelled at his predecessors in National.

Mr Twyford released some of the Government's solutions to the problems identified in the report, including asking the Ministry of Social Development to ``step up'' its work securing further transitional housing places before winter. Where the ministry will find those transitional places will be a revelation as it has to complete the roll-out of 2155 transitional housing places across New Zealand by mid-year.

Government officials are now investigating a new system for recording and monitoring the number of homeless.

The proportion of people in state housing compared with private rentals changed significantly between 1991 and 2013, particularly for Maori and Pasifika.

A problem for Maori is building on multiple-owned land, including developing infrastructure, finance and planning rules.

Mr Twyford is committed to working with hapu, iwi and other groups to ensure Maori have fair and equal access to housing and home ownership.

Many of the Government's policies are inter-related or have flow-on effects for another area. Lower immigration means fewer skilled trades people to build and equip the houses needed to increase home ownership.

The rise in the minimum wage may put employers off from hiring extra staff - even apprentices - exacerbating future skill shortages.

Much was made by Prime Minister Jacinda Ardern about ending homelessness and lifting people out of poverty but it all takes money.

Some of Mr Twyford's ambitious goals may need to be reined in and encouragement again be given to the private sector to build properties which can be affordably rented or sold.


 

Comments

The housing problem started with unregulated immigration, before the time of M Woodhouse. Labour has a mandate to make Intervention in the Market.

I would like to remind the minister and others its not just maori that have housing problems.

Well said.

 

 

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