Let’s stop the blame game and build new homes already, It’s time we stop blaming each other and just build new homes.
I do not believe a land tax or income ratio leading restriction will help solve the Auckland housing crisis. This issue is much bigger than blaming each other and most impotently of all the foreign land tax will only effects 4% of all homes sold in Auckland and 3% nationally, so this tax will not cool the markets but will just hurt our international reputation.
The other proposal of new income ratio leaning effectually makes it impossible for average kiwi first home buyers to buy their first home. What this restriction means is you will no longer to be able more than five times your household income, meaning the average kiwi household would be blocked from getting a mortgage of more than $405,000 under income-related lending restrictions being considered by the Reserve Bank
As you can imagine it’s next to impossible to find a house to buy in Auckland for that price, and before you “say just move out of Auckland if you want to own” the job options in the regions are simply not there so young Auckland families are left with a damned if you do and damned if you don’t.
I think we are all aware of the problems I don’t need to tell you that kiwi investor make up over 50% of all homes sold in New Zealand I don’t need to tell you about the cowboy real estate agents we have in Auckland or that the average house price increases nearly $1,000 per week. I don’t need to tell you that we export most of our building materials overseas and this current monopoly or Fletcher and Carter Holt Harvey means that over 70% of the costs of a new house is building materials and let’s not forget about the “Consulting Fees” that need to be “Paid” looking at you Nick.
So what would happen if we had a land tax on overseas or all buyers at the point of sale or calculated yearly the cost would be passed on to people that can least afford it, if the land tax only applied to overseas buyers that’s only 4% in homes sold in Auckland the cost of implementation would outweigh the benefit that’s not taken into account our international reputation so either way it’s a dud. and the income ratio leading restriction won’t hurt investors it will only hurt first time buyers, you try to find a house on a $405,000 budget in Auckland.
So what can be done, we need to build new homes we need to build them to the heavens and keep building, we need to build new homes like we have never built them before at a speed we have never seen before this will cost us and as a nation we need to understand this. we also need to target kiwi property investors they make up over 50% of all home sold in New Zealand overseas
We target these investor in a fair way, we need to look at the ghost homes in Auckland numbering 40,000 these home are unoccupied by anyone just sitting empty collecting the capital gains we should be taxing this we also need to look at some sort of tax credit for landlords willing to rent out homes at affordable rate simply put we need to put people in these 40,000 homes and if the investors don’t want to rent them then they should pay a substantial fee to have their homes sit empty.
People have to understand the Auckland housing crisis has the ability to tank out entire economy and the longer we leave it the more our children will pay.