Every fortnight Geoff Simmons talks with Jesse Mulligan on RNZ’s Afternoons programme about a variety of economic issues This week they cover the housing bubble. Will it burst? www.rnz.co.nz/jesse #geoffonomics
As New Zealand’s debt nears half a trillion dollars, people are increasingly asking whether we are at risk of a collapse. A large chunk of that – over $200b – is mortgage debt, fuelled by a housing market boom, the … Read More
Here is a classic illustration of how stuffed the welfare system is. Housing New Zealand (HNZ) allocates it’s low-rent properties to people based on their income and savings. Ms Bella Bowden easily qualified on all their criteria – a working … Read More
Earlier this week the New Zealand Initiative (NZI) released their thoughts on inequality and specifically the role housing affordability has played in exacerbating the numbers. It’s good to see a business-funded think tank acknowledging that inequality matters – despite the … Read More
For many years now some of us have been banging on about the fundamental policy bias that has led to an over-investment in property. Still on the political front nothing material has been done to deal to this cancer because … Read More
Labour’s housing policy hit all the right political notes; more social housing, more affordable housing, a tax-based rap over the knuckles for all those ‘nasty’ investors and of course a ban on foreign buyers. The question is can they deliver? … Read More
Over-investment in housing and the lending largesse that underpinned that orgy of excess led to the sub-prime crisis in the US in 2007 which in turn led to widespread recession in the developed world, a problem which remains for most … Read More
January’s North & South magazine is headed “Is the Housing Market Rigged”? The article goes into depth on the resurgent property market and whether the take-off in prices is like constructing castles of sand. It compares New Zealand with the … Read More
My 5 point plan for housing has prompted a fair bit of debate and I’d like to respond to the points people have made. Let’s start by clearing up one thing about housing as an investment. I am not anti-housing … Read More
Contrary to the findings of the Productivity Commission the fundamental issue with housing affordability is not lack of available land. That Commission has done the debate a major disservice by pointing the figure at land supply, the councils do not … Read More
In a speech on Friday, Prime Minister John Key claimed that under National, twice as many new houses were being built as under Labour. Steven Joyce followed that up by stating “Auckland’s housing problems are a regulatory issue, primarily, and … Read More
The Reserve Bank has reopened the debate on the housing crisis, and the responses from all three major parties have been notable for their impotency. Andrew Little appears to have ditched Labour’s brave but ultimately flawed capital gains tax, and … Read More
We have long written that the problem in NZ’s housing market, which more and more people are finally acknowledging, is a crisis, is a crisis of demand not of supply. Central to the causation of inflated demand are two factors. … Read More
Don’t get me wrong, I think far more radical changes are needed to get the housing market on a sustainable footing than Labour’s new policy on restricting foreign buyers. As long as we leave housing out of the tax system … Read More
Watching the political debacle unfolding over housing is as excruciating as watching the Black Caps play test cricket. Tentative steps forward, no application and not daring to do differently characterise both. Some policies are just too important to leave in … Read More
Anybody unfortunate enough to pick up a copy of Wellington’s daily newspaper today was assaulted by a screeching headline ‘Pricking the housing bubble’. Accompanying this was an entire front page devoted to how Bill English’s 2013 Budget is some sort … Read More
Auckland’s speculative housing bubble might be cooling in the wake of the Reserve Bank’s new loan to value ratios, but there is little to suggest that our days of housing speculation are over. The pause in Auckland may only be … Read More
In response to questions about housing affordability on Sunday’s Q&A Nick Smith announced changes to the Kiwisaver HomeStart scheme. He is increasing the income and house price caps for people to qualify for the subsidy. This policy has failed to … Read More
Capital gains tax is often put forward as a potential solution to the housing crisis. However, recent evidence shows that our de facto capital gains tax – the ‘bright line test’ – is not quenching the market. This accords with … Read More
The data published yesterday by Land Information NZ (LINZ) was far from perfect, but what it did contain give some indications of what is happening in our housing market. Foreign buyers – at least using the definition of non-tax residents … Read More