Ardern on ‘affordable housing’

Jacinda Ardern has been interviewed by Guyon Espiner on RNZ’s Morning Report on so-called affordable housing.

“This is still a price point significantly lower than what people are paying at market rates,” tells . The govt has raised its ‘affordable’ AKL price point from $600k to $650k.

Is $650,000 ‘affordable’ for an Auckland house? “For too many people it won’t be”.

“This is still a price point significantly lower than what people are paying at market rates.

“I would rather try than do nothing at all.” discusses what is ‘affordable’ for a house in AKL.

“We’re still doing policy work [on immigration fixes]. Making sure we have best export education system we can,” & also other changes in ensuring tests meet labour needs.

They keep missing what i think is an important point.

In the past most first home buyers started with older cheaper houses. Some people then go on to build new houses.

I’ve (part) owned seven houses and none of them have been new. I bought what i could afford at the time (sometimes barely afford). I don’t feel deprived.

60 Comments

  1. Ray

     /  May 15, 2018

    After all the hullabaloo from Labour I was expecting a rerun of the 1930s with a massive rebuild of statehouses as the only way forward.
    Instead we get a version of national light, plenty of blow but not much action.
    Twford, leading the close run race for least effective minister.
    Early days so hard to judge.

  2. David

     /  May 15, 2018

    “I would rather try than do nothing at all.”

    Interesting attempt at expectation management.

    • alloytoo

       /  May 15, 2018

      I would rather she did nothing at all rather than waste tax payers money.

      • Gezza

         /  May 15, 2018

        She feels she has a responsibilidy to do sumpthink becos National they reckon didn’t do anythink except make the Housing Crisis worse. Think yourself luckly she at least doesn’t say more worser.

        But Phil obviously isn’t good at sums, &, given the amount of time they’ve had pre-election – including over a decade of whining about it – to come up with some detailed ideas for a breakout from the eye-wateringly crippling cost of houses, hasn’t got a lot of clues, & hasn’t got a plan or programme worth peeing on.

        I don’t think they’re doing anythink yet that’s going to actually build more houses for couples with kiddies at prices & in areas thad are genuinely affordable. They’ve all got caught by surprise finding themselves in government.

        • alloytoo

           /  May 15, 2018

          Labour spent the last decade sabotaging the housing market via their deployed cadre’s in local government. They seem to have trouble turning that off.

          • Gezza

             /  May 15, 2018

            The RMA seems to have definitely become a monstrous beast to satiate if nearby building projects (on hideously expensive land) are anything to go by. They’re taking months, & progress seems to be interrupted for sometimes quite long periods, which I’m assuming are related to inspection dlays &/or labour &/or materials supply problems.
            … … … …
            A survey of the borough recently resulted in approval being given for infill housing. This has caused some irritation & unhappiness from those of us who were too lazy to consider the implications of your neigbour out of the blue suddenly adding or rebuilding extra housing units, with no section, right up against your place, & fire off an objection.

            Democracy’s no use if you don’t take the opportunity to use it. Few negative submissions were received.

  3. Blazer

     /  May 15, 2018

    the important point’ is that the Kiwi dream has become unaffordable because of Govt inaction.
    Maybe the stat that the average M.P owns around 3 properties each ,is a..factor.

    • Grimm

       /  May 15, 2018

      No. It’s become unaffordable “because” of government action.

      • Kitty Catkin

         /  May 15, 2018

        Even if MPs do own 3 places each, that’s only 360.

  4. David

     /  May 15, 2018

    “In the past most first home buyers started with older cheaper houses.”

    You clearly misunderstand what an ‘affordable house’ is, it’s a very nice house in a nice area for a price far less than it’s worth. Cheap houses are people want at all.

    • Blazer

       /  May 15, 2018

      so ,you say you recently ‘helped’ 4 parties onto the…property ladder…what was the price you charged for these first home owners?

      • David

         /  May 15, 2018

        I have said no such thing.

        • Blazer

           /  May 15, 2018

          really!it was just the other day…and you mentioned how wonderful your new Range Rover was!

          • David

             /  May 15, 2018

            Wrong David fool

            • Gezza

               /  May 15, 2018

              Yeessss, to be honest, given that if you post from two devices you seem to end up with different colour avatars, I’ve always wondered why whichever of you arrived here second wasn’t told “Sorry, that ID’s taken”.

            • Blazer

               /  May 15, 2018

              how silly of me to get ‘David’ mixed up with…’David’…I feel such a …fool…not.

          • David

             /  May 15, 2018

            “really!it was just the other day…and you mentioned how wonderful your new Range Rover was!”

            I own a Porsche, not a Range Rover……

            • Gezza

               /  May 15, 2018

              You’re the David with the pink avatar. Do you mind me asking, cos in my mind this is how I sometimes seem to differentiate you two , are you … um … not hetero? If it’s none of business, I of course apologise in advance, for the intrusion.

            • Gezza

               /  May 15, 2018

              *none of MY… that should’ve said. Soz.

            • David

               /  May 15, 2018

              “You’re the David with the pink avatar. Do you mind me asking, cos in my mind this is how I sometimes seem to differentiate you two , are you … um … not hetero? ”

              Very sis-normative to imply that pink is somehow correlated to homosexuality. Where is the sole’s right to breath?

  5. PartisanZ

     /  May 15, 2018

    “They keep missing what i think is an important point …. In the past most first home buyers started with older cheaper houses. Some people then go on to build new houses.”

    Pete, I think you are missing an important point.

    Back in say the 1970s, multitudes of people were building affordable homes using State Advances, Building Societies & Group Housing, whether they be first homes or not, which young families could afford to buy, whether they be first-time owners or not …

    This isn’t going to happen if the only new housing stock is more expensive, more lavish houses …

    We’ll have, and perhaps already do have, lower priced housing in high demand, driving prices up – and away from affordable – and higher priced housing in medium-to-high demand, driving prices up or at least maintaining their unaffordability …

    Almost like two ‘market platforms’ – both rising – without a stairway or ‘property ladder’ connecting them … other than speculation in anticipation of unrealistically high capital gains …

    Property speculation is inherently anti-affordable. Inherently anti-human ‘shelter and home’?

    If its broke … fix it.

    • Alan Wilkinson

       /  May 15, 2018

      They won’t fix it because they are idiots. The building act has made building cheap houses illegal. The RMA has made land that can be built on scarce and expensive. The party of big government and regulation of everything cannot afford to recognise that it is the real problem.

      • PartisanZ

         /  May 15, 2018

        As the previous government clearly didn’t …

        • Alan Wilkinson

           /  May 15, 2018

          As it is always tedious to have to point out the previous government did not have enough votes to deregulate. However, blame the electorate – brainwashed by the Lefty media into believing government is responsible for protecting them from their own stupidity.

          • Gezza

             /  May 15, 2018

            Who stopped them deregulating?

            • Alan Wilkinson

               /  May 15, 2018

              Your MP, Dunne, your favourite Maori Party, plus all the other opposition parties. Only Seymour would have supported them.

            • Gezza

               /  May 15, 2018

              Well, Seymour was bloody useless then, wasn’t he? Fat lot of good to anyone if he can’t get enuf clones into Parliament to make his votes count. Anyway, he’s Dancing With The Stars now, tacky, tacky, tacky – so he’ll come a cropper next election.

    • Gerrit

       /  May 15, 2018

      re- “more lavish houses”.

      People forget that in the 60’s and 70’s people bought, as the first rung up the property ladder, a 3 bedroom, single toilet, fibreboard planked house from someone like Neil or Universal Homes. With that you got just the house.

      No garage, no landscaping, no drives or paths, no fences, no clothesline, no letterbox, no carpets or floor coverings, no insulation, no heating, no showers – baths only, no light fittings (bare bulbs and witches hats only), cheap paint and wallpaper, , etc., etc.

      You slowly build up the equity in the property by (as funds permitted) improving your most basic off dwelling to a desirable stage to on sell. There would be a lot of cooperation by the residents in the street to lay concrete, build fences, etc.

      Now houses are expensive as everything is done upfront (including adding the improvement costs into the build price ) that we baby boomers build up over perhaps 10 years when money become available for raw materials and the sweat and from the previous home improvement has just dried on the brow.

      • Gezza

         /  May 15, 2018

        We built in 1980. You describe our situation to a T.

        • Gerrit

           /  May 15, 2018

          People forget that there was no labour costs in those improvements. Materials only.

          Now the improvement’s labour coats are added onto the price of a new house.

          • Gezza

             /  May 15, 2018

            I helped neighbours lay their concrete floors or footpaths, learnt to mix & lay my own. Widened the driveway pads. Built a humungous car deck on massive wooden post piles – under instruction from a mate who was a civil engineer & did the plans (council were rsoles, a bit – insisted on a rsj: we wanted a wooden beam). Used a mix of old 2nd-hand recycled bricks in a random pattern to make a really colourful, attractive-looking walled brick garden for the missus. Log walls. Planting out … own painting. Built a long white picket fence, looked stunning, painted it twice – & will never ever get a house with another one, or would replace it straight away … arse of a job …

            • Gezza

               /  May 15, 2018

              Learned to use & look after tools, machinery & equipment hired from Hire Pool, or borrowed from mates, & learned to avoid loaning anything again to mates who didn’t look after mine! … 😕

            • Gezza

               /  May 15, 2018

              … hated every minute of it a lot of the time, but I got as fit as a buck rabbit, I stayed slim but got nicely muscular, & I loved looking at the finished work results, & loved the cost effectiveness of it so much, that I just kept plodding on with the DIY work programme until done … & it all paid off when we sold.

            • David

               /  May 15, 2018

              Under the 2004 building act, thank you labour, you would now have to get an engineer to prove that your car port had a life of 50 years and you could literally spend 15k on fees and council.
              Last house I built had 380 pages submitted to council, you build a house in Auckland brace yourself for 70k in council fees and you will have to have all your professionals sign off everything so removing any liability from council. If you add that to a 350k section and then all the daft health and safety rules brought in under National and building a cheap house cant be done. National and Labour have done nothing to prevent monopoly or duopoly in nearly every area of building supply too wih=th their cozy arrangements through BRANZ.

            • Kitty Catkin

               /  May 15, 2018

              I have a fence with slats (done on the cheap, I’d say) and painting it is a pig of a job.

    • David

       /  May 15, 2018

      “Back in say the 1970s, multitudes of people were building affordable homes ”

      Yes, indeed. The average house in the 70’s was 140sqm, had no insulation or heating, a single, very basic bathroom and a kitchen that was little more than a few cupboards and some bench space. Roofing was corrugated iron and a building consent cost a few dollars.

      That is what an affordable home is,

      • High Flying Duck

         /  May 15, 2018

        Expectations have risen well in excess of incomes unfortunately.

        Those houses you speak of would be used as examples of substandard living standards these days, along with calls for government funding to improve their lot.

        • David

           /  May 15, 2018

          “Those houses you speak of would be used as examples of substandard living standards these days, along with calls for government funding to improve their lot.”

          Correct. That is a very significant factor in the ‘affordability’ issues. Couple that with the land prices, and you have a simple factor of house prices that the government cannot overcome without structural changes they are clearly not prepared to make.

        • Blazer

           /  May 15, 2018

          ‘property prices have risen well in excess of incomes unfortunately.’

          yes the equation was around 3x ave annual earnings=house price…now try 10-13x!

          • High Flying Duck

             /  May 15, 2018

            Did you deliberately ignore the point that houses now are quite different, and far more costly to build, compared to those built even 20 years ago?

            This article gives more detail as to why costs have spiralled:

            https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12051090

            I built last year. It is eye watering what it costs to get a house put up these days.

            • Alan Wilkinson

               /  May 15, 2018

              Of course he did. He always ignores the relevant facts that don’t suit his Lefty agenda. And after you’ve pointed them out he goes right on ignoring them and spouting drivel.

          • David

             /  May 15, 2018

            “yes the equation was around 3x ave annual earnings=house price…now try 10-13x!”

            It is misleading to use these ratios when the days of 3x earning was a time when most families were single income, and interest rates were north of 20%.

            There have been major structural changes that support these house price rises, for better or worse. Until someone actually tackles these changes, no change will be made.

            • Blazer

               /  May 15, 2018

              some rationale…!Structural changes are not the cause..they contribute but not to the degree of open slather for foreign investors that National and their ‘open economy’…encouraged.

              So what you need to explain is the how and why interest rates are dialled up and down…double the house price and halve the interest rate…halve the house price and double the interest rate…what a …magic show!

            • David

               /  May 15, 2018

              “they contribute but not to the degree of open slather for foreign investors that National and their ‘open economy’…encouraged.”

              Can you point to when Labour was not also in favour of this open economy? Like during the huge house price rises under the previous Labour government. Like I have said, none of the political parties are going to make any change to the structural foundations to house prices.

              “So what you need to explain is the how and why interest rates are dialled up and down…double the house price and halve the interest rate…halve the house price and double the interest rate…what a …magic show!”

              Inflation is a primary driver of interest rates, house prices are a lagging issue. The cost of finance is a fundamental factor in housing costs. It does not take an economist to work that out. If you half the interest rate, you double the affordability. NZ has seen interest rates trend down to 1/6th of their rate, that is a 6-fold increase in affordability.

      • Kitty Catkin

         /  May 15, 2018

        The houses I remember didn;’t have no heating or insulation (think Pink Batts) and they certainly didn’t have the very basic kitchens that David describes ! 140 sm isn’t that small.

        • Kitty Catkin

           /  May 15, 2018

          The average is 149 sm.

          I never lived in a house with no heating as a child. .

          There are many people living in houses from the 70s and before and they are by no means substandard and never were. That’s an absurd generalisation.

          • Kitty Catkin

             /  May 15, 2018

            Pink Batts came in in the 60s and I don’t know if they were the first of their kind.

            Asbestos (!!!) was widely used as insulation before that, according to something that I read. Nasty thought !

            We had nightstore heaters as well as radiant ones when I was a child. People who had fireplaces used them; no point in having one otherwise.

  6. Kitty Catkin

     /  May 15, 2018

    A letter to the paper some time ago said that when the writer bought his first house, it was much smaller than many modern ones, and much cheaper in real terms. He didn’t blame people now for wanting bigger and better houses, but made the point that these will inevitably cost more.

  7. Zedd

     /  May 15, 2018

    maybe those in Tamaki makaurau who know, they can never afford to buy a house in ‘millionaires row’ (the whole city).. should look south of the Bombay hills.. even south of Wltgn ? 😀

    • Gezza

       /  May 15, 2018

      South of Welly there be only mountains, whales, strange, haunted ale-drinking folk who say “She’s a hard road finding the perfect woman, boy”, monsters, places where the earth splits apart & evil spirits roar out & devour the unwary, & fire-breathing dragons, the legends say.

      • Alan Wilkinson

         /  May 15, 2018

        And the mighty Crusaders, Sir Gerald.

        • Gezza

           /  May 15, 2018

          Needed to slay the dragons, Sir Alan, & control the strange, haunted, ale-drinking folk.

          • Gezza

             /  May 15, 2018

            … with their dark mutterings about some horrid, evil-sounding creatures somewheres to the North that they screw their faces up and refer to as … The Jafas! 😡

  8. Blazer

     /  May 15, 2018

    why is this from your link significant?

    ‘The Chinese Government has cracked down on funds leaving the country. ‘

    • High Flying Duck

       /  May 15, 2018

      It’s not. It was a minor part of the article.
      But is you need an explanation, I believe he was saying the Chinese are the only ones capable of affording to gett through the unwieldy beast of council to develop housing these days, but this has been slowed considerably by funds not being allowed out of China, leading to further shortages.

  9. Blazer

     /  May 15, 2018

    ‘ I believe he was saying the Chinese are the only ones capable of affording to gett through the unwieldy beast of council to develop housing these days,’

    why though ,what is unique about the Chinese?

    • Alan Wilkinson

       /  May 15, 2018

      Presumably lots of money they need to get out of China. They can therefore afford to feed the ravenous paper-shuffling consents beast until it finally coughs the bits of paper that allow you to build something/anything.

    • High Flying Duck

       /  May 15, 2018

      Huge population base, leading to large sums on money able to be invested.

      • Blazer

         /  May 15, 2018

        so ALL foreigners accounting for only 3% of the property market is actually something you would call b/s on…yes?