The inevitable New Zealand housing crash

avatr Joe Trinder

mortagee

As the country goes beyond the point of no return in a housing crisis the National Government is in denial a crisis exists. By avoiding using the word “crisis” under instruction from Cosby Textor spin doctors are using language like “Issue” or “Challenge”. The National government have openly admitted they want to protect homeowners equity. The problem for the National government is they can’t protect equity and build affordable housing that is why they are doing the bare minimum to resolve the housing crisis.

Historically we have resolved a housing crisis before. In 1950 New Zealand was the third wealthiest country on earth after Switzerland and the United States with virtually no unemployment or homelessness. This was due to an ambitious housing campaign pioneered by the Prime Minister Michael Savage

The first labour government Nationalised the Mortgage corporation and offered low interests housing loans. It certainly wouldn’t hurt the economy  too Nationalise a few Australian owned banks. It might hurt the Australian economy but enable New Zealand first home buyers an opportunity to afford a homeloan.

Contracting corporations like Fletcher homes to build expensive housing at $500,000 per house is not a solution it’s merely enriching the National Partys donors. In the 1940’s the  Government mass produced State Housing in a factory as easily deployable kits  from 400 designs made from New Zealand made material. During the 1940’s the Government managed to build 30,000 homes and by the 1970’s had built 70,000 State houses.

Today the National Government are evicting tenants in the middle of a housing crisis and selling the houses privately.  Using tactics claiming the family is the wrong configuration and they don’t deserve a 3 bedroom house for two people. After evicting the tenants they don’t rehome a needy family but sell the house privately.

If the Keith Holyoake  National government of the 1960’s were to apply the same formula a young boy John Key and his mother Ruth Lazar would have been given a 90 day eviction notice from the state house at 19 Hollyford Ave.

Keyhouse
Prime Minister John Key – 19 Holyford Ave

Since the chiefs and tribes signed the Treaty of Waitangi  New Zealand has become a nation of immigrants but the Government refuses to adopt a policy where migrants are only permitted to build new housing and may not buy existing housing. This easy to implement immigration policy would increase the housing stock dramatically as 70,000 migrants come to our shores every year. Selling houses to migrants is not a basis for an economy because you make home ownership impossible for existing citizens.

The spin that landlords provide a valuable service by offering rentals is another factor impacting the housing crisis. The reality is land lords are getting someone else to pay off their mortgage the real favour is the tenant that is paying for a retirement fund for the landlord. If state housing stocks had not been run down landlords couldn’t charge their tenants high rentals prices as tenants would have alternatives.

The denial of a crisis by the National government is extensive from claiming high amounts of State Housing are damaged from cooking methamphetamine or not enough people for the state house is just spin. The reserve bank have warned the government  New Zealand is in a severe housing crisis and it’s impacting the economy . We can’t borrow ourselves out of it because we have been living beyond our means with a Government debt of $150 billion dollars, a debt our grandchildren will be servicing.

If the National Government want to be taken seriously as resolving the housing crisis they need to stop all evictions of state housing immediately and start reparing existing stock that is vacant. Call a spade a spade call this a housing crisis. Stop protecting equity and personal wealth for popularity and protect the national economy. Create aggressive policy that tackles the housing crisis not weak policy that can be avoided like the capital gains tax.

  • Ian Daynes

    Until very recently, John Key was not only not calling it a crisis, he was calling it a housing ‘boom’ – shows where his loyalties lie. Houses are now ten times the average yearly income, compared with the accepted standard of three. In other words, in real terms they cost three times as much as they used to, no wonder no-one can afford them.