Census 2018 – national highlights

Census 2018 data has been released. The process has been a problem, with a quality assessment finding the majority of key data was either very high, high, or moderate quality, but some data is poor or very poor


Key facts

New Zealand’s 34th Census of Population and Dwellings was held on 6 March 2018. We combined data from the census forms with administrative data to create the 2018 Census dataset, which meets Stats NZ’s quality criteria for population structure information.

The census night population count of New Zealand is a count of all people present in New Zealand on a given census night. The census usually resident population count of New Zealand is a count of all people who usually live in and were present in New Zealand on census night. It excludes overseas visitors and New Zealand residents who are temporarily overseas. The following population information is based on the census usually resident population.

Results of the 2018 Census showed:

  • The Māori ethnic group comprised 16.5 percent of the census usually resident population.
  • New Zealand was the most common birthplace, at 72.6 percent. This was followed by England (4.5 percent), the People’s Republic of China (2.9 percent), and India (2.5 percent).
  • The most common languages spoken were English (95.4 percent), te reo Māori (4.0 percent), and Samoan (2.2 percent).
  • More than 9 in 10 households (91.9 percent) in occupied private dwellings had access to a cell or mobile phone, a higher proportion than those with access to the internet at 86.1 percent.

Ethnicity

The percentage of the population who identified themselves as belonging to the Māori ethnic group was 16.5 percent.

There was no change in the top five ethnicities between the 2013 and 2018 Censuses: New Zealand European (64.1 percent), Māori (16.5 percent), Chinese not further defined (nfd) (4.9 percent), Indian nfd (4.7 percent), and Samoan (3.9 percent).

The 2018 Census totals by topic – national highlights tables have national counts of ethnicities at the most detailed level of the ethnicity classification. However, 2018 Census population and dwelling counts has broad groupings of ethnicities (that is, European, Māori, Pacific, Asian, MELAA (Middle Eastern, Latin American, and African), and Other ethnic groups) at various levels of geography.

Birthplace

Of the census usually resident population, 72.6 percent were born in New Zealand. This compares with 74.8 percent in the 2013 Census.

The next most common birthplace was England at 4.5 percent, down from 5.4 percent in 2013.

This was followed by the People’s Republic of China (2.9 percent or 132,906 people) and India (2.5 percent or 117,348 people), both up from 2.2 and 1.7 percent respectively (or 89,121 and 67,176 people) in the 2013 Census.

Languages spoken

Of the top five languages, both te reo Māori and Northern Chinese (including Mandarin) speakers increased slightly since the 2013 Census, from 3.7 to 4.0 percent, and from 1.3 to 2.0 percent respectively.

English was the most common language with which people could hold a conversation about everyday things, with 4,482,135 speakers (95.4 percent of the population).

The next most common languages were:

  • te reo Māori (185,955 people or 4.0 percent)
  • Samoan (101,937 people or 2.2 percent)
  • Northern Chinese (including Mandarin) (95,253 people or 2.0 percent)
  • Hindi (69,471 people or 1.5 percent).

New Zealand Sign Language was used by 22,986 people (or 0.5 percent). In 2013, this was 20,235 people (or 0.5 percent).

Education and training

One in four New Zealanders (24.5 percent) participated in full- or part-time study. Of these, 87.0 percent participated in full-time study.

Of the population, 18.2 percent of adults reported no qualification for their highest qualification, down from 20.9 percent in 2013.

The proportion of adults who had a bachelor’s degree or level 7 qualification for their highest qualification was 14.6 percent, while 5.9 percent had an overseas secondary school qualification.

Housing

The proportion of households in occupied private dwellings who owned or partly owned their homes, and made mortgage payments, was 27.8 percent. An additional 18.8 percent owned or partly owned their homes and did not make mortgage payments.

Of households whose dwelling was not owned or held in a family trust, 31.9 percent made rent payments, while a further 3.4 percent lived in a dwelling rent-free.

Of the households who paid rent, 83.5 percent rented from a private person, trust, or business, and 0.3 percent of households who paid rent rented from an iwi, hapū, or Māori land trust.

Heat pumps were the most common form of heating used in New Zealand homes (47.3 percent), followed by electric heaters (44.1 percent), and wood burners (32.3 percent).

Most households in occupied private dwellings had access to a cell or mobile phone (91.9 percent), and 86.1 percent had access to the internet.

2018 Census totals by topic – national highlights

Microsoft Excel Open XML Spreadsheet, 621 KB

Stats NZ: https://www.stats.govt.nz/information-releases/2018-census-totals-by-topic-national-highlights

Government defensive as Opposition keeps up pressure over KiwiBuild targets

The National Opposition continues to apply relentless pressure on the Government’s lack of significant progress with what was once a strongly promoted ambitious KiwiBuild target of 100,000 houses in ten years.

But the key target seems to be missing – the lack of availability of reasonably priced land.

Yesterday in Parliament:

Hon Simon Bridges: Is the Government still committed to building 100,000 KiwiBuild houses over 10 years?

Rt Hon JACINDA ARDERN: As the member well knows, we’re going through the process of a reset around the KiwiBuild programme [Interruption]. Are we committed to building affordable homes? Are we committed to trying to improve access for first-home buyers? Are we the Government that has built more houses than any other Government since the 1970s? The answer to that is yes.

Hon Simon Bridges: Is that a confirmation that the 100,000 houses in a decade commitment is now gone?

Rt Hon JACINDA ARDERN: No.

Hon Simon Bridges: Is it Phil Twyford who’s been reset?

Rt Hon JACINDA ARDERN: No.

Hon Simon Bridges: Then why did the housing Minister Phil Twyford say this morning, on that 100,000 commitment: “It’s like American nuclear ships in the 1980s. It’s a neither confirm nor deny situation.”?

Rt Hon JACINDA ARDERN: As I’ve just said, we are in the process of working through a KiwiBuild reset, but whilst we do so we are continuing to build houses. Again, as I’ve said many a time in this House, we are a Government building more houses than any other since the 1970s.

Hon Simon Bridges: When is the climb-down on her flagship policy of 100,000 houses in a decade going to be confirmed?

Rt Hon JACINDA ARDERN: (a waffly reply)

Hon Simon Bridges: How can she have confidence in Phil Twyford, when he’s seen only 80 KiwiBuild houses built so far and he won’t confirm her flagship policy of 100,000 houses?

Rt Hon JACINDA ARDERN: Because we’ve built more State houses, more transitional houses, and housed more who have been homeless. We have also stopped the sale of residential housing to foreign buyers. We have also closed tax loopholes. We have made a difference to the housing market, and that is ultimately making a difference for families. We inherited a dire situation with our housing market, and we are turning it around.

Hon Simon Bridges: How about a straight answer to a straight question—

SPEAKER: Order! Order! The member will resume his seat. Now, he’ll stand up and he will ask a question properly.

Hon Simon Bridges: Is the 100,000 houses in a decade target gone?

Rt Hon JACINDA ARDERN: As I’ve already said to the member’s original question, we are working through our KiwiBuild reset. When we have completed that, we will be making announcements in due course.

Hon Simon Bridges: To be clear, has she had any input into the issue of removing the 100,000 KiwiBuild commitment in recent times?

Rt Hon JACINDA ARDERN: (a waffly reply)

Judith Collins also touched on it in question 6.

Hon Judith Collins: Will the recalibration of KiwBuild drop the additionality tests as well as the 100,000 houses target?

Hon PHIL TWYFORD: Well, I expect that in June we’ll be releasing the results of the reset of KiwiBuild, but I would say this to the member: this Government will not back away from building large numbers of affordable homes for Kiwis, building more State housing, reforming the rental market, housing homeless people, reforming the planning system and infrastructure financing—all of the things that are part of our housing programme that that party never did for nine years in office.

So Twyford did not challenge the suggestion that the 100,000 houses target might be dropped.

National have followed up on this line of attack. RNZ:  KiwiBuild ‘a broken promise’ – Bridges

The government has broken its flagship election promise on Kiwibuild and the Housing Minister should resign, National Party leader Simon Bridges says.

A question mark hangs over a core plank of KiwiBuild – with the government refusing to guarantee its promise to build 100,000 houses over 10 years.

“It was really Labour’s number one flagship promise,” Mr Bridges told Morning Report

“It was the big bold thing they were delivering.

“I’m absolutely certain it is a broken promise and half way through their term it is gone.”

Mr Bridges said if the target did go, Mr Twyford should resign.

While the target number may provide a target for National, it is missing the real target – the lack of availability of reasonably priced land to build on. When in Government National failed to deal with that. There is no sign of Labour dealing with it anywhere near adequately, all they seem to have done with Kiwibuild is put a different label on a continuation of similar means of building, but still with limited land supply.

I don’t think that 100,000 houses in ten years is important at all.

10,000 houses – that is additional houses, not just the Government taking over the development of houses that were being built anyway – in two years would still be underperforming but a big improvement.

National will no doubt claim a win if the 100,000/10 year target is dropped, but who trusts long term political promises?

But the fundamental failure continues – it is too hard to make more land available for building houses. And it looks like fixing that is in the too hard basket for this Government, like the last. What Labour labelled as a housing crisis is more of a crisis of timid government.

 

Public housing wait list climbs as landlords sell up

The waiting list for public housing has doubled over the past two years, increasing substantially since the Labour-led government took over in late 2017, despite Labour promising to increase housing stocks and decrease waiting lists and homelessness.

The suspension of tenancy reviews, and landlords selling up and getting out of supplying rental housing, have both been blamed.

Stuff:  Public housing waitlist cracks 10,000, with more families waiting for longer for housing

The public housing waitlist has rocketed past 10,000 as more people wait longer for public housing.

At the end of 2018 fully 10,712 eligible households were waiting for state or social housing – 73 per cent more than a year ago, and over three times the number waiting at the end of 2015.

The vast majority – 78 per cent – were deemed as “priority A”, meaning the Government believed they were the most in need of help. Almost half were in Auckland.

This is despite the Government building 1658 new public housing places over the last year, the largest increase in a decade.

Ministry of Housing and Urban Development officials blamed higher rents, greater awareness of public housing, and a slowdown in the rate of people exiting public housing for the increase.

Housing Minister Phil Twyford said concerted effort over “many years” would be needed to fix homelessness.

He didn’t say that during the election campaign in 2017.

Twyford paused “tenancy review” last year – the process by which Housing New Zealand check whether a tenant is still eligible for a state or social home.

National housing spokeswoman Judith Collins vigorously criticised the move, but Twyford said previously that it had not contributed significantly to more people staying on in state homes – only around 200 households would have been up for review during the pause.

Tenancy review resumed on Monday with some changes: any family with children or someone over 65 is now exempt.

Emergency motel stays were on the up too.

In the three months to the end of 2018, 15,676 emergency housing grants for motel stays were granted -up from 14,000 the quarter prior. These went to just under 2700 individual clients – with many taking multiple grants. This was up from 2585 in the quarter prior.

Collins said Twyford’s multiple reforms to private rental market – both enacted and promised – had driven up rents as landlords were selling up and getting out of the business.

“Landlords are leaving the market in droves. The Government in its steps to try and attack landlords has actually sent a whole lot of people out of that market and that means that there is now more people wanting public housing,” Collins said.

“They are selling up and they are selling to people who might put two people or one person in a house rather than five or six.”

Twyford received advice last year from officials saying rents could rise as the result of his reforms to tenancy laws thanks to landlords feeling like they were under assault and selling up to owner-occupiers, who generally have less people in each house than renters.

“While these effects should be minor, the cumulative effect of changes to the Residential Tenancies Act 1986 may lead landlords to perceive the effects as more than minor. As a result, even if legislative changes did not materially affect the financial returns of landlords, some many nevertheless choose to sell their rental properties,” the officials wrote.

“The combined increase of these policies will be to increase sales of rental properties, with fewer landlords purchasing.”

Twyford’s changes included ending letting fees and increasing the quality of rental properties via the Healthy Homes Act.

Sorting out major housing issues was never going to be quick or easy.

The National government were perceived to have dropped the ball on housing, and also on RMA reform (which would have made it easier and cheaper to open up land for development), leaving Twyford and the incoming government with huge problems too deal with.

If anything Twyford has managed it worse than National.

Newshub:  Action, not ‘rhetoric’ needed from Government on housing – poverty campaigner

Ricardo Menendez March from Auckland Action Against Poverty, thinks resources have been wrongly allocated.

“We’ve seen a lot of talk about KiwiBuild, we’ve seen a lot of talk about affordable private rentals, but the state housing sector has suffered as a result.”

Mr Menendez March said not enough is being done to solve the issue and the Government needs to focus on action.

“We are calling on the Government to look at genuinely pulling out all of the stops, not just rhetoric, actually putting in the resources required to build enough state homes.”

He said that more needs to be done to improve the unaffordable private rental market too, including regulation.

“The Government have said nothing about putting a cap on rents, introducing legislation to freeze rent increases or at least limit the amount.”

Housing crisis >> KiwiBuild crisis >> what next?

When in opposition Labour talked up the housing crisis, even though it was a problem that grew over many years.  They promised big – 100,000 houses big. And ‘affordable’.

In Government they launched KiwiBuild and soon conceded, sort of, that new houses in places like Auckland in particular were a long way from being affordable for people who needed housing the most. But the pushed on.

However it has become apparent that KiwiBuild is growing into some sort of crisis of it’s own  a a crisis of credibility for the out of depth Minister of Housing Phil Twyford, as well as for his Government. And if it can’t appear to be at least partly fixed by next year it could become an election campaign crisis for Labour.

What should happen right now? Listener: The KiwiBuild failure should galvanise urgent action on NZ’s housing disaster

When a nation’s flagship housing policy is such a spectacular failure that it makes the New York Times, the minister in charge cannot avoid the international embarrassment.

This is the position Housing Minister Phil Twyford now finds himself in. Having arrogantly sneered at all those who dared question his strategy and timetable, he has failed to deliver on the very thing New Zealanders care most about – the urgent need for a solution to our housing crisis. This policy was central to Labour’s pitch to voters at the last election. The failure to deliver 1000 KiwiBuild homes by July – so far only 47 have been completed – is the definition of a broken promise, ameliorated only by the likelihood that few truly believed the Government would keep its word in the first place.

That the previous Government struggled to make any meaningful changes in the housing area should have indicated to Twyford that affordability was more complex than Labour, and National before it, had assumed.

Prime Minister Jacinda Ardern declared the market had failed, so the Government had to step in. She was right that the market had failed, but wrong to assume that the Government would make complex problems disappear merely by becoming a property developer itself.

Perhaps she should have paid more attention to competence rather than kindness. A kind captain of a sinking ship is still in charge of a disaster.

Inevitably, it has come up against all the same obstacles private developers face. These include the high cost of land, labour and materials, restrictive regulations, local authorities’ planning rules, lack of infrastructure, the Resource Management Act and neighbourhoods where existing homeowners refuse to countenance more intensive development.

The market failure Ardern referred to will not be solved by swapping a private property developer for a state-owned one. The market failure is not ideological. This is the real world, and not the 1930s with plenty of suburban land available for state housing.

The Prime Minister hasn’t resiled from the Government’s commitment to deliver 100,000 houses in 10 years. But a Government that is elected for three years still promising to ratchet up house production with a goal 10 years hence when it may not be in office, is not treating the public with respect. New Zealanders, having already witnessed the debacle over tree planting, are not so easily fooled.

The Government needs to urgently do what it can to change those things over which it has control. The Opposition, having itself failed when in government to make headway on housing affordability, owes it to New Zealanders to support any reasonable legislative changes to facilitate more house building. Ratepayers, too, need to allow councils, which have more say than the Government over the availability of land for new, infill and high-density housing, to use the powers at their disposal. And we all need to accept that changes that make homes affordable may affect the value of many existing houses.

That’s a tough one.

Certainly the cost of housing is an issue that needs to be addressed, and quickly. But it appears that the Government hasn’t got the courage or the ability to do this.

The recent Demographia International Report, which compares median house prices in seven wealthy countries plus Hong Kong, reports that in Australia housing has become more affordable over the past year as prices fell due to tightening credit. Yet, alarmingly, New Zealand housing has simply become more unaffordable since this Government took office. Property here is now further out of reach than in the US, Australia and the UK. This is beyond embarrassment. This is a national disaster.

Disaster, crisis, whatever. It needs urgent attention – but does Ardern understand this?

 

Are the key causes of housing shortages being addressed?

While the failure of KiwiBuild to live up to hype has been big news I still haven’t seen much said about the key causes of the housing shortage – the lack of available land and the time and cost and difficulty in  making land available due to the dysfunctional RMA.

Even Labour cheerleaader Simon Wilson is on the case.

But he doesn’t mention the RMA at all.

KiwiBuild struggling to deliver on housing crisis

KiwiBuild is one of Labour’s most important initiatives. It is supposed to address the ‘housing crisis’, to boost the number of houses needed around the country to accommodate a growing population. And it was initially presented as a way of portraying the Labour-led government as progressive and as compassionate as Michael Joseph Savage’s Labour that kicked off state housing  in the 1930s.

But KiwiBuild has proven to be a problem for Labour.  It is struggling to deliver on Labour’s promises, and the resignation of it’s first head – Head of KiwiBuild wasn’t working, now resigns – won’t help house building progress nor credibility.

The promise (Labour housing policy):

Build 100,000 affordable homes across the country

Labour’s KiwiBuild programme will build 100,000 high quality, affordable homes over 10 years, with 50% of them in Auckland. Standalone houses in Auckland will cost $500,000 to $600,000, with apartments and townhouses under $500,000. Outside Auckland, houses will range from $300,000 to $500,000.

It was always going to crank up the building programme.

The plan (Labour FAQ: KiwiBuild):

KiwiBuild is aiming to build:

  • 1,000 homes in the year to June 2019,
  • 5,000 the year after, 10,000 in the year to June 2020,
  • 12,000 every year after that.

The execution to date – Stuff’s Kiwibuild Tracker:

  • Homes built 33
  • Homes under construction 77

There is a lot required in the next five months to make the June target.

Gareth Kiernan (chief forecaster at economic consultancy Infometrics) at Stuff: Resignation another step to KiwiBuild failure:

Stephen Barclay’s departure as head of the KiwiBuild unit makes it even less likely that the scheme will be able to progress at the rate hoped for by the government.

Even allowing for a slow start, things are falling woefully behind.

Bearing these KiwiBuild targets in mind, having dynamic leadership for the programme seems imperative. Yet the KiwiBuild unit has effectively been without a leader of any sort since early November.

​KiwiBuild is an ill-conceived policy mess that doesn’t understand what is making housing unaffordable, why that unaffordability is a problem and needs government intervention, or even exactly who the policy is trying to assist.

We’re left with small $650,000 houses in Auckland’s outlying suburbs being offered to graduate doctors, or building homes in New Plymouth and Wānaka that are still too expensive to provide a realistic alternative for people wanting to get into the housing market.

Attempting to provide affordable housing while failing to address high land costs and ignoring critical capacity constraints in the construction industry is a recipe for failure.

So will Phil Twyford keep trying to do more of the same? Will Jacinda Ardern stick with Twyford as Minister of Housing? Probably, demoting Twyford would be seen as an open admission of failure, and more importantly, there is hardly a wealth of talent waiting to step up to one of the toughest jobs in Labour’s Cabinet.

KiwiBuild has to find a new head, and Twyford is going to have to show abilities not yet apparent, as well as finding new ways to accelerate the rate of house building.

Whether housing overall is a large problem or a crisis is just political semantics.

Whether KiwiBuild under performance is a large problem or a looming crisis looks like reality.

 

 

Ardern: “housing for every price point, every income, every need”

In an interview on Newshub Nation Jacinda Ardern has defended Kiwibuild providing what many would see as expensive housing to people with very good incomes, and said that the Government should provide housing for just about everyone – “So for us it’s about providing housing for every price point, every income level and every need.”

That’s a remarkable statement.

Here is the whole part of the interview transcript that discussed KiwiBuild and housing.


You mention KiwiBuild — there’s been more controversy this week around the income thresholds for KiwiBuild. Have you over-promised on how affordable KiwiBuild homes actually are?

I think when you look at the context of where we’re building in the Auckland market, when you’ve got houses sitting around the million-dollar mark, and first home buyers saying that’s simply not a threshold that we can meet. What we’ve done with KiwiBuild, of course, is not about subsidising housing, but about providing more supply in the housing market where builders and developers just were not producing houses.

From memory, roughly five per cent of houses being built in that market were what you would call something adequate for a first home buyer. We’re trying to turn that around. We’re intervening in the market by building what people are looking for. When you think about that fact that, say, two teachers with five years’ experience, you know they just come under the threshold for KiwiBuild and even then those couples are struggling to find a home.

So that’s what KiwiBuild is all about. It’s rightly been popular, and I think we’ll look back on what we’re doing in the housing market and think this is something that will be a real turning point.

MBIE figures released to us early this year suggested that a first home buyer would need to earn at least $114,000 to buy a $600,000 home. The median household income is only $88,000. We’re looking at seven times the median income in order to afford a $650,000 home. That’s not considered affordable. The New Zealand initiative would say that you would need to bring that down to three times the median income to meet international affordability ratings.

Two points that I would make there. That’s the upper end of KiwiBuild, of course there are price differentials across the country, and we expect they’ll be much more affordable in different parts of the country. That’s the first point. The second point is that that demonstrates — the fact that even at 650 that’s a very big difference from the million-dollar houses that we’re seeing sold more frequently in the Auckland housing market — pointing to the unaffordability that we have right now. So we know we have an issue.

That’s the top end of what KiwiBuild is offering. There are lower price points as well for slightly smaller homes that are good starter homes and, again, they’re cheaper across the country. But it points to the problem that we have in New Zealand that that is the price point that people are having to look at in order to get into the market. We are looking at other options. We’re looking at shared equity schemes.

We are increasing the number of public and state houses available. We’ve got an agenda to build 6400 state and public houses within New Zealand as well.

So for us it’s about providing housing for every price point, every income level and every need.

Alan Johnson from the Salvation Army says KiwiBuild is one example of how Labour has become the party of middle-class welfare. What do you say to that?

I totally disagree. People still have to pay for these homes themselves. They have to muster a deposit themselves.

I think that many would argue with that. KiwiBuild has been criticised widely for months, like “Disappointment is setting in as more people realise that the scheme is really only going to benefit the rich.” – see Political Roundup: Kiwibuild is now ‘socialism for the rich’ (NZH).

The high income couple who Labour used to promote the first KiwiBuild house hand (Ardern described it as “a momentous occasion) over said it was like winning lottery – see Purchasing new KiwiBuild home ‘like winning Lotto’ (1 News).

This is just one of the things that we’re doing across housing. I’ve already mentioned state housing. We’ve brought on an extra 1200 public housing spaces. We’ve invested in housing first, which is to try and work with those who are homeless in New Zealand. We know that a home affects everything. It affects your ability to build community, to keep your kids in the same school, and so we’re looking at everyone’s income needs and everyone’s housing options to make sure that we’re providing for everyone.

But what I would say to Alan as well, is that it’s part of our psyche — the idea of home ownership and the fact that people who consider themselves to be in the middle haven’t been able to afford a home, we should want to turn that around too. I don’t apologise for that — as long as we’re also meeting the needs of other New Zealanders who might not be able to muster those deposits and that’s why we’re looking at shared equity as well.

There are almost 9000 people waiting for a state house; you mentioned state housing. 800 homeless in Auckland alone. Can you see how people would think maybe that $2 billion going to KiwiBuild could be better used elsewhere?

And again, we need to be really careful around the way that we talk about KiwiBuild. That’s, of course, a rotating fund that’s set up to ensure that we have the initial funding for the project. Of course, people are purchasing these homes, and that money goes back into the pot to rebuild additional houses. This is not a subsidy.

This is actually just the state using its large buying power and determining that there’s a gap in the market and partnering with developers to build what’s missing. It is not a subsidy scheme for buyers; it’s just plugging the gap and ensuring that we’re providing where the market has failed.

More than 296,000 people, Prime Minister, are getting an accommodation supplement because they can’t afford their housing costs. That’s 6500 more people than this time last year. Do you need to do more?

Look, absolutely. Absolutely we do. And that’s why it can’t be just about KiwiBuild. It can’t be just about state housing. It can’t be just about emergency housing places.

But one of the great issues, of course, with things like accommodation supplement – what we ultimately need to be doing is making sure that we’ve got that public housing in the first place. So that’s why we stopped the state housing sell-off under the last government. We are increasing supply. We just announced a huge amount of work that we’ll be doing in Porirua to renew and refresh 2900 state homes there. It is a huge agenda that we have.

And I hark back here to something Michael Joseph Savage first said when we first started building state houses under that Labour government. He said, ‘We don’t claim perfection, but we do claim a considerable advancement on where we have been in the past.’ And I’d say the same for us. It’s not perfect. We’ve had 12 months, but already, we’re ramping up a building programme that I think will really pay dividends and make a real difference for people who need shelter.

It was always going to take quite a bit of time to make a significant difference on housing. The National Government tried (with disappointing results) to resolve growing housing shortages and homelessness. The Labour-led Government promised a lot but struggled to show results over their first year in office.

And things aren’t going smoothly. To try to fast track KiwiBuild houses the Government has bought houses ‘off the plan’ – from developers who were already building houses.

The elephant in the room largely remains unaddressed, the Resource Management Act. Things like the constraints it puts on making land available for new housing, and the use of the RMA by NIMBYs to oppose high density housing in their neighbourhoods.

The shortage of land and the shortage of housing are major factors in pushing the prices of housing up to levels that are unaffordable for many on lower incomes who can’t save deposits and can’t afford large mortgages, even at the current low interest rates.

A typical KiwiBuild house has a price of about $650,000. That requires a deposit of at least $65,000, a substantial amount for those on low incomes. And a mortgage of $585,000 at say 4.5% (current KiwiBank rate, low deposit buyers often pay higher mortgage rates) would cost about $26,000 a year, or about $500 per week. That’s hefty enough, but if mortgage rates go up (they were more than double current rates 10-12 years ago) many people would be unable to afford to pay their mortgages.

It is proving difficult enough to build 10,000 houses a year (Labour had a target of 100,000 houses in ten years).

But suggesting that the Government should provide “housing for every price point, every income, every need” sounds like Ardern is in lala land.

Foreign buyer rules relaxed

Prior to getting into Government Labour talked up the effect of foreign buyers on the New Zealand housing market, and copped a lot of criticism for their ‘Chinese sounding names’ claims. They were also accused of exaggerating the impact of foreign buyers – and this has turned out to be true with foreign buyers being just 3% in recent statistics.

Once in power Labour restricted foreign buyers despite warnings of what that would do to discourage new housing developments. They have now partly backtracked.

RNZ:  Government relaxes rules on foreign buyer ban

The government’s overseas buyers’ ban on New Zealand homes has been softened, with some multi-storey apartment buildings now being exempted.

New Zealand officials and minister have also been negotiating with Singapore as the ban contravenes agreements between the two countries – that has now been resolved with Singapore securing an exemption, along with Australia.

Since the legislation has gone through select committees the government has acknowledged some fish hooks, that may have actually put the brakes on housing supply in Auckland.

Broadly, they apply to developers concerned about not being able to complete big projects if they can’t sell individual apartments to foreign buyers.

Another issue was overseas corporates getting caught up in the ban when they wanted to buy residential land – for example to build cell phone towers.

They were valid concerns, Trade Minister David Parker said.

“The advice we had from officials was that if we didn’t allow investment in apartment buildings then the whole complex was more likely not to proceed so there would be fewer purchase choices for New Zealanders,” Mr Parker said.

Parker has admitted they rushed to implementation of the changes and have had to reconsider when it became apparent it was having an adverse effect on trying to get more houses and apartments built.

Under the new regime, overseas investors would be able to invest in new housing, particularly apartments, new rentals, and homes available to purchase under rent-to-own or shared-equity arrangements.

The new rules allowed foreign buyers to purchase apartments ‘off the plan’ but they had to sell them once built. They can now retain ownership, but can’t live in them themselves.

This seems weird, especially when the government says they want to get more Kiwis into home ownership.

And the changes announced yesterday are still being criticised.

Phil Twyford in Opposition in 2016: Foreign buyers’ data selective and ineffective

The Government’s newly released foreign buyer data doesn’t give an accurate picture because it was collected at a time when offshore speculators had temporarily deserted the market, Labour’s Housing spokesperson Phil Twyford says.

“The Government is out of touch with the 70 per cent of New Zealanders that support Labour’s policy to ban offshore speculators from buying existing homes. National should back my Bill when it comes before Parliament next month, instead of supporting foreign speculators against the interests of Kiwi first homebuyers,” Phil Twyford says.

Twyford as Housing Minister in December 2017: Ban on overseas speculators a step closer

“This Government welcomes foreign investment in houses to add to our housing supply,” Phil Twyford says.

“However, purchases of homes by offshore speculators push first home-buyers and families out of the housing market.”

Phil Twyford says the legislative changes demonstrate the Government’s determination to make it easier for New Zealanders to buy their first home.

“We expect the law to be passed early next year fulfilling a key pledge in our 100 Day Plan. The previous National government said it couldn’t be done without breaching trade agreements. They just didn’t try and in doing so, they put foreign buyers ahead of New Zealanders.

“This Government prioritises home ownership and housing affordability for all New Zealanders. This Bill will ensure that house prices are set by New Zealand-based buyers, not international buyers,” Phil Twyford says.

The National opposition now say: Twyford’s numbers badly wrong on foreign buyers

“When challenged on the AM Show today and faced with official statistics, Phil Twyford failed to defend his previous stance that foreigners – particularly Chinese – dominated New Zealand’s property market,” Mrs Collins says.

“He originally claimed that 30 per cent of homes in New Zealand were being sold to foreigners. In the face of irrefutable evidence – he could not defend those numbers.

“Official statistics released yesterday show foreign house buyers make up just three per cent of New Zealand’s residential property market, exactly what the previous National Government maintained.

“In the lead up to the election Labour and Phil Twyford ran a scare campaign claiming buyers with ‘Chinese sounding names’ were not real New Zealanders deserving of a home and were responsible for ‘pricing first-home buyers out of the market’.

RNZ: Overseas house buyer problem ‘was never real’

Many developers are still opposed to a ban on the sale of existing homes to foreigners despite a slackening of the proposed new rules.

Only a fraction of New Zealand’s housing stock is foreign-owned and there are developers who think banning or restricting that investment discriminates.

In the first draft of the Overseas Investment Amendment bill, overseas buyers could buy apartments off the plans, but would have to sell them once the building was completed.

The new draft has softened that, now allowing developers to sell up to 60 percent of their apartments off-plan, without the requirement for buyers to sell within a year.

Official figures show nationally 3 percent of people who bought residential property in the last quarter didn’t hold New Zealand citizenship or resident visas.

Mr Church and other developers believe these figures prove the whole law should be scrapped.

“It indicates that the hyperbole around this issue being a much larger problem is just that, it was never real.”

Interestingly Twyford didn’t feature in yesterday’s announcement, it came from David Parker as Associate Finance Minister.

Foreign buyer screening law reported back

The Bill putting in place the Government’s policy of banning overseas buyers of existing houses has been reported back to Parliament by the Finance and Expenditure Select Committee.

Under the new regime, overseas investors will be able to invest in new housing, particularly apartments, new rentals, and homes available to purchase under rent-to-own or shared-equity arrangements.

“This will help first home buyers to get their foot on the property ladder,” David Parker said.

All permanent residents and resident visa holders who spend the majority of their time in New Zealand will be able to purchase homes under the regime without obtaining consent.

Australian and Singapore citizens and residents will be treated the same as New Zealand citizens and permanent residents.

Australia was always a special case. Singapore was not happy with the initial changes and also pushed for an exemption.

 

 

 

Will housing ‘super ministry’ address RMA restrictions?

Phil Twyford is announcing a housing ‘super ministry’ It will only help fix the housing shortage if it finds a way of increasing land supply and significantly reducing section prices.

RNZ: Housing super ministry ‘will help fix crisis’, says Twyford

Housing Minister Phil Twyford will announce the establishment of the Ministry of Housing and Urban Development this morning, which will provide policy advice on affordable housing, homelessness and urban development.

“Having a more focused and capable public service to deliver the [government’s] reform agenda will ultimately allow us to build more houses, better houses, more quickly,” Mr Twyford said.

The new organisation will include functions currently spread between the Ministry of Business, Innovation and Employment (MBIE); Ministry of Social Development (MSD) and Treasury.

Mr Twyford said the new ministry would cost about $8 million in the first year, and it be funded from existing operational budgets of the units that shift to the new ministry.

The new ministry will be established on 1 August, and officially start operating on 1 October.

Mr Twyford remains confident the new ministry will help address some of the challenges.

“It’s only a small part of it … (but) it certainly will help us fix the housing crisis,” Mr Twyford said.

An RMA reform super ministry may do more good.

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.