Treasury is advising Housing Minister Megan Woods not to make KiwiBuild a priority.
A document included in a wad released by the Government on Thursday and Friday, after it announced its “housing reset”, shows Treasury recommended she limit the goals of the new Crown entity responsible for housing, Kāinga Ora, to “enabling housing supply” and “managing and delivering additional public housing”.
In its July briefing to Woods on her new Housing portfolio, Treasury said that if Kāinga Ora didn’t have a “narrow focus”, it was likely that “alternate goals” would “dominate decisions on housing project selection, scope and funding”.
“You can introduce other priorities after the acute need for housing is met,” Treasury said.
Treasury didn’t say what these “alternate goals” were, but the fact it didn’t reference “first-home-buyers” once in its 10-page briefing provides a hint it was referring to KiwiBuild.
Urban Development Minister Phil Twyford, when he was still the Housing Minister, in May told interest.co.nz the Government was shifting some of its focus from first-home-buyers to renters.
Supply at the centre
Treasury went on to say: “The Government now spends more than $3 billion per annum on housing assistance. Without supply reforms, building programmes [of which KiwiBuild is one] will be expensive, inflationary, and slow to deliver."
“Even with substantial increases in budgets, housing assistance cannot address housing need across the spectrum in the current housing environment.”
While there are supply-related reforms underway, the “housing reset” didn't include anything to up supply.
Tweaks were largely aimed at increasing demand for KiwiBuild houses, which Woods told interest.co.nz should give developers more confidence in supporting the scheme and ramping up supply.
Treasury said more land needed to be opened for development.
It noted that national policy statements on urban development and productive land, released for consultation after its advisory for Woods was written in July, would have “material impacts on housing supply”.
National policy statements direct local councils on the approach to take when issuing consents under the Resource Management Act (RMA).
The proposed statement on urban development requires them to prioritise intensification, while the one on productive land directs them to protect highly fertile land from urban sprawl.
Treasury said: “A generally permissive approach of enabling housing both up and out is required or prices (public and private) will continue to rise.
“This will require changing councils’ choices (through persuasion and incentives), requiring actions from them they do not wish to pursue (through an enforced, proscriptive and directive National Statement) or bypassing them (through devolution and/or centralisation of functions).”
Treasury also noted the role the RMA plays. An independent panel is reviewing this, but changes won’t be made before the 2020 election.
Goal needs to be "lowering" house prices
In terms of Kāinga Ora, Treasury said the agency needed to be specifically focused on “lowering the price of housing”.
When asked by interest.co.nz on Wednesday whether she believed house prices needed to fall, Woods wouldn’t give a straight answer. However, she said the market was starting to respond to tweaks made by the Government.
Kāinga Ora will be established on October 1. It will be a Crown entity that will pull together Housing New Zealand, its subsidiary HLC and the KiwiBuild Unit, to lead urban development projects and be a public landlord.
Legislation to give it the power to override local planning rules to speed up development of large scale projects in designated areas is expected to be passed next year.
More funding for public housing necessary
Treasury highlighted how the public housing waiting list was growing fast.
As at its July briefing, there were 11,655 households on the waitlist, plus 2,535 waiting for a transfer.
There were 1,899 households in private motels, with 381 households in motels for over three months at a cost of $1,500 per week. 2,782 households were in transitional housing, which is often government contracted motels.
Treasury said there was a case for increased government funding for public housing.
It said the Government needed to offer “attractive payments” to providers of public housing.
“Market rents fall short of allowing investment in new public houses.
“The [HNZ] funding review could help build a case for increased government investment in public housing.
“It can also highlight the potential value of schemes that can support public tenants and applicants to successfully enter and sustain private tenancies; thereby reducing demand for more public housing places.”
According to the Ministry of Housing and Urban Development, in 2018 there were 291,000 households that were either severely deprived, in public housing or were spending more than 30% of their gross incomes on rent.
There were more stressed renters not in public housing (the dark blue bar below) than there were renters who could afford a KiwiBuild-priced home (the green bar).
The housing reset didn't include policy or pledged funding changes aimed at the most deprived.
Demand-side assistance could hike house prices
The Government did however act against Treasury's advice by offering first-home-buyers more support.
Treasury told Woods that relying on “demand-side assistance such as rental assistance and home ownership assistance will struggle to increase supply given the constrained environment”.
“In fact, financial support is likely to increase prices when supply is constrained. The Accommodation Supplement and HomeStart grants are examples of demand side assistance.”
Yet as of October 1, a cap restricting the size of HomeStart grants people can get if they band together to buy a house will be removed.
First-home-buyers who qualify for government-backed mortgages will also only need a 5% rather than a 10% deposit.
Treasury, in a briefing provided to Woods on August 21 (eight months after the reset supposedly began and just more than two weeks before it was announced), said these changes would cost $22.6 million over nearly five years.
It expected reducing the HomeStart deposit to 5% would help 2,400 households at a cost of $17.3 million, making HomeStart grants available to all eligible buyers who want to buy a house together would benefit 347 households and cost $1.4 million, and reducing the Welcome Home Loan deposit requirement to 5% would help 990 households and cost $4 million.
147 Comments
Thank you Treasury for stating the bleeding obvious. Nothing will or can change. Until they unravel the Brown Cardigan Brigade, Councils will continue to exploit and feast on the consent process. Until they unstitch the hold the monopoly, and the tentacles, of the hungry lion Fletchers has on all levels of construction supply. There it is.
Fletchers ain't the issue, looking at construction costs excluding land and GST it's cheaper to build here than in Australia's more competitive market (GST 8% AUS vs 15% in NZ makes things easier)
The brown cardigans you mentioned absolutely are the issue. It is frustrating that this government got rid of the minister who wanted to tackle supply and replaced it with one who wants to stoke lower end demand to buy short term votes and decrease financial stability...
"Stats NZ tells me we are adding a new person every 7 minutes and 49 seconds": So true. Constantly amazed that in this time and age so many Kiwi families are having 5, 6, 7, 8 children. Unbelievable. Really the government should promote a "Stop at 2" campaign to educate people on the cost of having so many children (not only on the country, but on the environment as well), or even tax disincentives for having more than 2 children?
"Goal needs to be "lowering" house prices" - Easy win! Tax empty homes in city center areas, use the generated revenue for Kiwi build. Also frees up empty homes for rent, helping to release pressure on central city house prices. Job Done!
By the way Vancouver’s Empty Homes Tax levy raised C$38 million (Around $45 million NZD) in its first year, think how may affordable homes could be built from that.
Great to finally see Treasury giving meaningful advice to politicians.
Can we see Treasury analysis on the $20 Billion profit to Foreign owned companies in NZ from asset sales. That is worth 40 years of our largest exporter profits, in ONE year to foreign owned banks etc.
And could Treasury please advise where this $20 Billion profit p.a. is coming from exactly.
On behalf of all the children requiring medical care but not receiving it due to lack of funds.
Thanks
... I've seen the answer to that in Manila ... at a friend's house which was just 5 by 5 square meters , but was 3 levels ... the staircase leading up was daunting , around a 2 in 3 rise ... counting the rooftop garden / BBQ area , they had 100 sq. m floor area ...
No mention of the primary cause of overcrowding in rentals then? Er, quietly now, dare I mention it? Excessive immigration rate.
There are three drivers of the housing crisis:
1 Too much money, (from foreign buyers, new residents and the Aussie banks). Which mainly pushes up prices.
2 Too many people coming in. Which is the main cause of rental overcrowding and homelessness.
3 Too many regulations. Which restricts supply.
Weird that when referencing KB houses, there was no mention the price caps depending on the size (rooms), so how can there be price inflation when developers have to deliver houses within that price cap?
Hopefully by increasing the pool of buyers that will lead to an increase in suppl within those price caps
In the case of Christchurch, the Kiwibuild prices were higher than the market price. Because the developer knew if it wasnt sold at that price, the Govt would buy it. So they jacked all the prices up. Then the Labour Govt wondered why none of them sold. I tell ya, this Govt is so naive they are probably being ripped off everywhere, they have no business sense whatsoever.
Megan Woods housing reset was very underwhelming.
What was required was the government committing to building a much bigger programme. That cheaper rental housing be added into the Kiwibuild mix at lower price points than the current Kiwibuild price points.
The fact this wasn't done. That no extra funding has been added into housing. That for some reason housing has been dropped out of the Wellbeing budget process will have dissappointed many housing activists.
Respect for Megan Woods and the whole Cabinet, especially Jacinda Adern and Grant Robertson will be reduced and that is political capital which is hard to recover...
Politicians full of hot air? Whatever next?
Actually, I guess what happens next, is what happened in the US. Eventually people get so pissed of with their useless politicians that they elect new representatives that are not politicians, but appear to understand their concerns. Hayek's classic strong man who promises to "Get things done". That is why Trump, Putin, Modi, Erdogan et al got elected.
It was probably a lucky 'prophecy' but I predicted this situation 3 years ago, pre the Trump presidency.
https://medium.com/land-buildings-identity-and-values/housing-affordabi…
Exactly. Countries like France and Canada that voted in young, socially "woke" politicians have come to realise that good looks isnt a qualification for running the country. Trudeau now has a lower approval rating than Donald Trump! No matter how many times Jacinda puts on a hijab and hugs people, its not going to hide the fact that she is incompetent.
It is hard to know what happens in Cabinet. I think Robertson has to take some blame too. He is control of the budget process. I find it amazingly stupid that with all the social consequences of poor housing that no extra funding was given to housing in the first Well Being budget. What a sham.
They don't have endless wells of money. Labour are trying to live within their means (thank god), with probably 95% of their budget spoken for by things they can't touch like Education, health, welfare and superannuation, and what little left over discretionary they do have being committed to NZF's PGF bribery and Green hobby-horses and a little on some dumb choices early in their term (ineffectual free student fee spend-up) they have almost nothing left to do anything meaningful.
Housing was one of the big issues that Labour campaigned on in 2017. It was bigger than mental health for instance and the government injected how many extra $billions into mental health?
Housing should have received a similar budgetary commitment from a Well-Being budget.
I recall Treasury and the National Govt told them that prior to the election, but they made all their promises anyway. No one should be surprised at the fact that they cant deliver them. Vote them in a second time, and there will be a deluge of new taxes imposed to close the budget gap. Something to look forward to.
A special sort if ignorant to even think about trying to get pregnant at that time. She knew better though the same as she knows better now.
The only way for Labour to stay in power for another term is to go to the polls now. Their ship is taking water every other day.
Ardern had zero leadership experience prior to July 2017. Not good preparation for the most important job in the country. Toss in a baby and instinctual desire to be everyone's friend and anyone would be floundering. She's a nice figurehead, sympathetic and kind, but being PM requires a lot more than that.
If they, for some strange reason as a Labour government, aren’t prepared to build many more houses, then they are quickly going to have to find ways of better enabling the market.
Or they are gone burger.
The national policy statement on urban development has some potential. Let’s see if they chicken out again.
On the sole issue of underspending on public housing, thats been an enormous hangover from Nationals disasterous 3 terms where they turned Housing NZ into a hostile, unapproachable entity for those depending on it, sold off huge chunks of the estate to government friendly developers or simply idled hundreds more homes with the nett effect of drumming up lots of demand for their key consituent...the boomer landlord. If there is a shortage of funds to underpin more HNZ homes being built then I suggest the means test for SuperAnnuation be reintroduced so the farcical situation of millionare boomers receiving a state funded pension is ended. That should free up a few million for some new homes. It just makes me ill when there are needy people living in cars and super annuitants are out playing golf and sitting on millions in assets.
Build out only on land that is not use for anything else, otherwise intensify closer to the city (looking at you Greenlane, Ellerslie, Remmers et al)
Make provision for people to be able to live in tiny houses, that could start sorting a whole lot of problems
Build state houses like there is no tomorrow
Alter tenancy laws so we can lease housing similar to the European way (don't worry you can still rent out your old dunga much the same way you already are, but there would be options for tenants not to have to live that way
Stop importing people at the rate we are, there is absolutely no need for it, whatsoever. You can't tell me there are skills shortages for all the franchised fast food places that spring up around new housing developments, have yet to see one operated by a born New Zealander.
I don't know what response you were expecting. You showed your daughter a picture of two women and when she obviously and predictably associated that with a female dominated profession you came on here and reported it as if it proved those women were only capable of working in kindergarten because of how they look, largely like women.
So your daughters IQ aside, you made a stupid and sexist comment cloaked in it being from your daughter's mouth and when you got called on it you try to play the victim. How about you apologise?
I don't know what is more sad:
That you thought the comment was meaningful enough to post.
That you thought reporting it as coming from your daughter gave you a cloak to hide from how obviously sexist it is.
Or that you seemingly, if we take you at face value, don't realise how sexist it is, and not clever sexist either, really sad sexist.
If it was two guys sitting there who looked the same'ish but blokes. I wouldn't think they look like two high ranking individuals incharge of something so important either.
Then listening to their repeaded maybes and other blar blar blar, did not fill me with confidence. Going though the artical looking at different points it's a shambles.
They didn't look the part, the delivery was a disaster and there was no substance to it. Dosen't matter what sex they are, it was unprofesional from start to finish.
.... onto it , Kezza .. and that sums up this coalition government ... they're outta their depth... they spent 9 years backstabbing one another ...
And then , when they least expected it , Winston Peter's anointed them heirs to the political throne ...
... kindergarten teachers look more professional , more clued up on their subjects , better able to articulate their message ....
It was not sexest. They do not look profesional enough to be running something that big whatever their sex. Their delivery was not profesional and their plan they had worked months on is bound to be a failure as well but who knows because there are no targets set so how can it fail.. still nothing to do with their sex.
Im a builder, hunter, fisherman, love a beer and now days I hardly if ever hear sexist comments against females. BUT i do hear them from females against guys. My new little game is to say 'sexest comment' when I hear them.
Watch Peppa Pig. Daddy pig is a bit of a screw up, mummy pig never puts a foot wrong, Mrs Rabbit is all over the place doing all the work and the only blokes that get to work are builders.
She's just self conscious of her own appearance, have you seen Peppa behind the scenes without the camera trickery? See below:
http://iforce.co.nz/i/1li4eupv.0ti.jpg
http://iforce.co.nz/i/oyl1vcwv.pdm.jpg
So your argument is that it wasn't sexist because kindergarten teacher is a respectable job? Great, then how do you explain the comment that it was 'priceless' that his daughter said they looked like kindergarten teachers or why this observation was worth posting at all. Clearly the implication was they were only qualified to be kindergarten teachers and not be ministers of the crown based on how they looked.
Yep you got me, I would have got away with it, if it was for those medling kids...
Well what I do is go onto this site with two names, sorry three NZdan as well from above. Because I'm a paid troll sent here from Russia to influence Kiwi's towards accepting our evil plan to take over the world. That reminds me, smoko time. Keep going I'm on double bubble and at 12.00 it's tripple time.
But seriously.. reading in that kindergarten teaching is deneaning and only for females.. that's one and one make some crap that is criptic cockney ryming slag worm hole to another meaning that did not occur BS.
Good by, the KGB are angry with me becuase I have been discovered. I will not be commenting again as I will be in the goolag.
Kindergarten teacher is a respectable job. Do they look like misters of the crown?
What are their qualifations?
The point stands that they did not look the part! If you want to come from a possition of power and authority use a podium. Have some other people standing behind you.
Wait, wait, I only just noticed this. So you are saying that a women, ranked 6 in Cabinet, with a PHD, can only look credible if she has some other people standing behind her? What is she supposed to do, gather up a posse for every announcement to look the part. And what would their qualification be so as to add to her gravitas? Are we just talking a group of staffers or should she have a nice selection of men to look the part? I'm doubtful another six women in this shot would have dimished the kindergarten feel from Yvil/Yvil's daughters perspective.
If you mean bussiness and want to at least look the part, do what you need to do.
Her ranking doesn't matter a toss, she's been tagged as dead wood and thrown under the bus. Ideally I would love to see it be handed to the Greens and NZF so either of them never see the light of day again.
So Hardly. According to NZ stats teachers are at arround 80% trust rating and Gov't MP's are at 28%.
So it is by far more demeaning to call someone an MP's than a teacher. And by far worse to call them a Labour or Green MP running Kiwibuild. Yep even your own party doesn't like you, if they throw you on that smoking pile of junk.
There's a difference between trust and respect, and truth is that while liked as people, teachers, particularly early childhood, are generally judged to be pretty weak intellectually. It is in the main a last-resort career for people without the ability or drive to do something more prestigious. The teachers I meet today are intellectual minnows compared to the older teachers I was lucky enough to have at high school - from an era when teachers were still quite respected as being highly educated.
Waiting for Helen to get her job done and get it legal. Funny to watch her come in as a ringer like Richie came in for the flag screw up.
Helen, things are going really bad back here at home. Can you convince the masses that the electic puha is all good because the wheels are falling off and we need everyone stonded so they just don't care. Throw them a bag of chips and they'll be fine.
It was sexist. It's fine to criticize them. I have. It 's fine to say they are out of their depth. I have. But to say they look like kindergarten teachers? That's really demeaning. What does a kindergarten teacher exactly look like anyway?
Racism is viewed very dimly by the editors of this website. How about sexism? Maybe not. People seem to have got away with homophobic comments too.
Read the original comment 'I showed the photo above to my daughter...' it is solely how they look in that photo. And the only thing noteworthy I can say about how they look is they are a couple of women. Its so obvious when you put it in context of his 'daughter'.
Why did he post it? Why is it relevant that his daughter thinks they look unqualified?
Because the fact that they look unqualified, corroborates they are unqualified.
So looks, and lets be clear, looks in this case are their clothes, faces, gender and general appearance.
It cant be their general appearance because Yvil wouldn't be saying someone who naturally looks a certain way isn't qualified.
And he cant mean their clothes because they are just wearing the kind of clothes professional women wear.
And he cant mean their gender because you say that's in my mind.
So what is it about their appearance in that photo?
Arround and arround in circles. What was meant by this, what was meant by that, was there a hidden meaning, am I right, I have to reseach this, he is wrong...
It wasnt meant to be demeaning in any way. Get over it! I'm gone, this is nonsence blar blar blar whoppie do da.
'It wasnt meant to be demeaning in any way.'
That is a very first person statement to make. Only the person who wrote the post can make definitive statements about the intent.
Don't pretend you are leaving because you don't want the argument, your previous comments show you do. You are leaving because you cant provide an alternative reason (other than sexism) for why he posted that comment.
The reality is that if he had worded it differently his (perhaps your) intent would have been more disguised. But, by stating he showed the photo to his daughter, asked her to state based on a picture what these women did, and then when his daughter stereotyped them, which we can easily infer he expected her to do, he posted the response because he thought that was 'priceless' that his daughter stereotyped them because it fit with his view that they are unqualified (which they may in fact be, just not because of how they look or their gender).
It is not unreasonable to say Dr Woods is unqualified as an opinion, to be honest most ministers are out of their depth in terms of their own expertise, it is unreasonable to say someone looks unqualified unless you are bloody clear what about their appearance makes them unqualified.
You know what you did and why you did in Yvil. It is important we call this rubbish out.
How about you apologise, say you thought it was funny, you realise it was a sexist comment and you’ve learned your lesson. If you show that maturity you won’t get much respect around these parts.
Dude, asking the question is the sexist part, because there is so little context in the photo you are asking your daughter to stereotype them based on how they look.
If he’d shown them a video and said ‘how do you think they performed’ that would be different.
I haven’t responded to some of your other comments, not sure why I responded to this one.
Let me try one more time to explain this to you.
If I asked you to send me a photo of you in your builder gear and showed it to my daughter and said ‘does this man look very smart to you?’ That would be wrong regardless of what she said because I, as the adult, am encouraging her to stereotype you based on how you dress for work and how you look.
If my daughter could read and I encouraged her to read your posts and I asked ‘what do you think of what he wrote’ and she said ‘that man is a sexist idiot’ and I posted that her and said ‘Priceless’, that would be absolutely fine. Because you are being judged on what you did, not how you look.
According to the kiwi stats. Teachers are at 80% trust, MP's 28%. It is by far more demeaning to call someone a MP than a teacher. And even worse to be a MP incharge of Kiwibuild, even your own party dosen't like you. It's the end of the road assiginment.
Kids hold their kindergarten teachers in very high esteam.
So you read a hell of a lot into his comment.
Thanks for all the replies, I'm glad I started a good debate with over 70 comments! I definitely don't think the original comment was sexist, ok it happens to be 2 women on the photo but I could have said the same if it was Twyford and Woods, it's about their lack capability to perform their job as housing ministers
Exactally Yvil. Fine if your comment was about two guys but highly offensive if it is about two females. That in itself is sexest.
Simon Bridges gets heaps about his accent, that's fine. Gerry Brownly, is a big falla, John Key aged a lot over his time that's all acceptable. If someone said that Jacinda is looking worse for wear in her addressing the Kiwibuild issue the other night, the hounds would be released.
Nah a dull 0-0 football draw.
The government were promising in attack, early in the game. But they failed to convert some good chances. They faded in the second half, and lost their captain Twyford to a red card. The team wasn't managed very well by Gaffer Ardern.
Meanwhile, Treasury played the same unimaginative game they always play. It was predictable and even the government's leaky defences could keep them out.
I'm only relying on the article here, not the source documents but I think I agree with Treasury.
I always saw kiwibuild being primarily concerned with lowering the cost of building and boosting supply. The two go hand and hand because one of the key levers to lowering building costs is increasing scale and innovation. To my mind the government would achieve that by committing to large projects that use innovative methods. So factory production and possibly, if it makes sense, diversifying the building materials market.
As people point out land prices are an issue. Part of solving that is freeing up more land and building more areas in parallel. The other part might be improving transportation infrastructure. I cant for the life of me understand why more effort isn't being put behind a fast train (not this 2 hr plus rubbish) from Hamilton to Auckland stopping in Huntly, Pokeno, Pukekohe etc.
If Treasury is saying that the goal of getting FHBs into affordable homes is a massive diversion, I agree. Build houses, including state houses, and as we raise the production level and lower the costs the rest will take care of itself.
Easy fix.
1. It is a fact that Labour and the Greens can get anything of substance done no matter how much money they throw at it.
2. New build houses in the price range do not get taxed as much. Say 15%. Cost to run, zero and a 20% return on profits. Chances of screw up because Labpur and the Greens are not involved hit close to zero.
The coming house correction will drop house prices before KB gets 100 houses done.
Correction:
National policy statements clarify what the vague language of the RMA actually mean. Regional and district plan policies, objectives and rules must be changed to implement an NPS. So an NPS is way more than guidance on how to process a resource consent application.
NPS's are incredibly powerful. One of the major reasons that the RMA does not work very well is that successive Ministers for the Environment have not used that tool the way it was originally designed.
There are 5 things to consider, %, demand, supply, tax, Kāinga Ora
1) Price of money - we have low worldwide interest rates which drive up asset prices - nothing can be done about this
2) Demand - the excess demand is coming from an immigration rate that is too high for the demand response to stay up with. NZ has run a high immigration rate for a long time as a % of population. But, in absolute numbers that x% kept going up & most immigrants stayed in Auckland driving house prices upwards.
A high immigration rate drives up gdp (but with dis-economies of scale which have to be addressed but later down the track.) Cynically its a very easy way to prop up the economy.
The immigration rate is slowly falling under Labour, but we need a proper population policy of managing the immigration rate around maximising gdp/capita growth & socioeconomic benefits.
3) Supply. - The RMA was meant to be effects based legislation, but was hijacked & old style town & country planning act zoning was implemented which is rigid & inelastic. Every individual rule in the RMA certainly did not go through individual regulatory impact assessment. If they had most rules wouldnt exist.
The RMA needs revamping - All existing rules and covenants should be sunsetted with a 10 year horizon and a single effects based national level urban plan developed by all councils jointly guided by an appropriate National Policy Statement. (we dont need district plans stacked as high as the skytower for a population of 5m)
Developer contributions - these should be ditched. They simply push up the capital cost of housing. Its not the developer that creates the demand but the user. Targeted rates should be implemented.
Building supplies oligopoly - the ComCom needs more powers to ensure competition. The ComCom should have to give much more weight to the HHI index when making decisions.
4) Land tax - we need a land tax to drive the efficient use of land, offset by reducing other taxes
5) Kāinga Ora - Treasury is right in its advice. This entity should be purely focused on providing housing for the very poor in society (some currently living in garages), where the private sector cannot make a profit.
It should aim to also provide this accommodation mixed in with other economic tiers of housing (provided by private sector) to avoid the development of slums.
Inept,Government, always was going to be and the ones that supported it were blind to the fact that they had the ability to run a country at all.
The 5% Deposits is a waste of time, as most wont qualify at all, as there is a thing in that the Banks have to follow which is called “responsible lending” and lending to most will not come under responsible,lending.
Megan Woods is full of it!
Treasury staff come from the school of neo liberal economics, with a significant number trains at US Tertiary Institutions that advocate free market winner take all idealism.
Their staff have no hands on practical business experience of how the actual market operates, and one could say the same for the Commerce Commission.
The net result is we now have a concentrated supply chain to deliver more housing. Growth cities fringe is ring fenced by rich developers, Building material prices are controlled by 2-3 (predominantly overseas) national players and Local Councils that pamper to their needs. Ask yourself, how can NZ timber be cheaper in Australia to purchase than locally?
Central government need to regulate to break down these cartel practises. This could include:
1. Requiring land developers to deliver a required percentage of freehold sections/houses that have to be sold to first home buyers, with no government guarantee on price.
2. Require land developers to pay for growth requirements, by collecting more in development charges up front. Refund that not used, once the full catchment and costs are realised.
3. Encourage more inner city intensification, to deliver better value out of existing public infrastructure and amenities
4. Tax land developers on the land entry price, rather than some jacked up valuation to a related party.
Treasury staff come from the school of neo liberal economics, with a significant number trains at US Tertiary Institutions that advocate free market winner take all idealism.
Their staff have no hands on practical business experience of how the actual market operates, and one could say the same for the Commerce Commission.
The net result is we now have a concentrated supply chain to deliver more housing. Growth cities fringe is ring fenced by rich developers, Building material prices are controlled by 2-3 (predominantly overseas) national players and Local Councils that pamper to their needs. Ask yourself, how can NZ timber be cheaper in Australia to purchase than locally?
Central government need to regulate to break down these cartel practises. This could include:
1. Requiring land developers to deliver a required percentage of freehold sections/houses that have to be sold to first home buyers, with no government guarantee on price.
2. Require land developers to pay for growth requirements, by collecting more in development charges up front. Refund that not used, once the full catchment and costs are realised.
3. Encourage more inner city intensification, to deliver better value out of existing public infrastructure and amenities
4. Tax land developers on the land entry price, rather than some jacked up valuation to a related party.
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