This week at the Finance and Expenditure Committee, he was trying to fend off David Parker’s assertion that a falling home ownership rate was causing a widening wealth gap between those who own and those who rent.
I actually think that in the housing market the biggest generator of inequality are planning rules what deliberately drive out low and middle income housing and deliberately drive up the prices of housing so we can have nice looking apartment blocks in the so-called ‘liveable city’, not those messy low and middle income people. It is very unfair and it is locking a whole lot of people out of the housing market or pushing them into part of the market to make access to work and education difficult and we need to change that
This is a great example of diverting and distracting when you are in a tight spot. While it is true that planning rules do need to be reformed to encourage more and better urban development, Bill English’s demonisation of town planners is hilariously misplaced for the following reasons:
1. Home ownership rates are falling, down to 65% according to the census, and 61% in Auckland. Rampant house price inflation, and now the LVR lendng limits have shut a generation of first home buyers out of the market. Increasingly there are two classes: those who own property and make windfall capital gains, and those who pay rent and slip further behind.
2. The Member for Dipton seems to be saying the “liveable” or compact city stops affordable housing being built in order to provide apartment blocks for the well-off. This is confused to say the least. If his answer is to deregulate urban planning so low income people can buy cheap houses an hour’s drive from where the jobs are then he is seriously mistaken about the economics of sprawl. It adds huge travelling costs to residents, and huge infrastructure costs to the ratepayer and taxpayer. In fact, good quality medium density housing near train stations and town centres offers the best options for affordable housing.
3. Auckland is a property speculator’s paradise. Yet Bill English refuses to consider a Capital Gains Tax that would take the steam out of those speculative pressures, or restrictions on offshore speculators who outbid Kiwi first home buyers.
4. Not only does National’s fixation on deregulating planning ignore the costs of rampant property speculation, it fails to tackle chronic low productivity in the construction industry, lack of competition in the market for building materials, and the fact that the new Auckland Unitary Plan will bring ample greenfields land into the market.
5. The big driver of inequality is the failure of National to rein in out of control house prices. They’ve been in Government for five years and it wasnt until the fourth year they started to do something, and that pretty much just amounted to tinkering with planning rules.