MAY DAY GUEST BLOG: Penny Hulse – Is political consensus on housing so hard to imagine?

By   /   May 11, 2015  /   18 Comments

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MAY DAY is traditionally the day Unions celebrate the progressive change they have impacted upon society – May this year The Daily Blog has asked leading progressive voices in NZ to give their views on the pressing issues that require solving and how we as NZers should go about solving them. This is second one – Penny Hulse

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A few things happened after I announced my desire to facilitate political consensus to solve Auckland’s housing crisis (which may or may not have been related).

Prime Minister John Key who lives in a flash house in Parnell denied there was a housing crisis.  Affordable Auckland’s mayoral candidate Stephen Berry (surely you have heard of them / him?  No??) said I was only thinking about my mayoral candidacy.  The Salvation Army (god bless them) supported me while acknowledging consensus would be difficult to achieve. Labour Party housing spokesperson Phil Twyford dismissed the idea outright with an audible snort indicating he would not be prepared to help ‘the other side’ sort things out.  The Reserve Bank warned the government it needed to do more to dampen demand in the face of increasing housing pressures.  And the chief human rights commissioner agreed a cross-party accord should be established to tackle the very serious issues of adequate housing.

Several journalists couldn’t resist comment.  The Royal New Zealand Herald’s columnist Brian Rudman opined I was “disowning my political trade” by wanting to separate the housing issue from scoring political points.  More helpfully, Fran O’Sullivan directed the government to sit up, take notice and then act.  Bernard Hickey said the government and Auckland Council needed to consider more aggressive measures than simply freeing up land for housing.

It seemed like everyone had an opinion, and in expressing those opinions most of them ironically couldn’t go past trying to score a few political points of their own.

So a big thank you to Bomber for this opportunity to expand on my thinking – without all the shouting.

I don’t pretend to know all the answers to the housing crisis but I do know we are having one.  We need to ensure housing is taken seriously and that we have a resilient long-term approach.  This issue is too important to leave to the ‘left’ and ‘right’ factions of old-fashioned political parties.  We need to be able to talk about the real issues without fear of walking off the party line.  And we need to look at the barriers to home ownership at all levels – the shortage of rental and affordable homes, the building cost blow outs and the challenges to our community housing sector in picking up often run-down homes from the government sell off of state homes. One would have to ask why this ideological initiative is occurring in the midst of a housing crisis.

To even start to think about all of that we absolutely must have a safe space in which we can openly discuss ideas and plans.

Despite all the critics, Housing New Zealand is doing good work, desperately trying to unlock the value of its landholdings to build more homes.  But with no government ring-fenced money we risk going backward on our social housing numbers.

We have extraordinary community housing providers, well placed to run social housing, but imagine if we had an easier pathway to transfer ownership to them without putting our most vulnerable people at risk.

We have our Special Housing Areas but imagine if we could get houses built faster by getting government to unlock the funding for the critical infrastructure to service those areas. We are standing up for Auckland and the government must do its bit.

The government is trying to address the funding available to first home buyers but image if we changed the rental top up given to landlords – which must add up to hundreds of thousands of dollars a year – into a direct mortgage assistance programme.

Imagine if we could find a better way to ensure long-term rental security and income for landlords and have social housing welcomed into communities.

Auckland Council’s response to the crisis to date has been collaborative development, strong advocacy for the early uptake of the new proposed Unitary Plan provisions and starting a forward land and infrastructure programme. That work has been going on since amalgamation and we are making good progress.

We are also in the process of establishing a new urban development agency – Development Auckland – which will partner with others to address some of these issues, especially fragmented land ownership. We have also approved new initiatives such as a housing bond guarantee which will enable community housing providers to access funding at lower interest rates.

But we need to do more.

To say Aucklanders don’t want to live in apartments is completely incorrect.  Aucklanders are embracing the thought of a compact city where going up, as well as out, is a good option with many advantages.  And while the NIMBYs cry foul in that regard I agree with Hickey – let’s defy them and say no, they can’t control politics in this city or this city’s growth.

Our Unitary Plan will help with that, a number of developers are doing excellent work on apartments and we need to ensure more come out of the ground – and quickly.

And there are other options.  Imagine if we could innovate with the private sector and take up the offer from Advantage New Zealand to build prefab housing.  Proposals that can speed up the construction of quality, cost-effective homes have my total support.

Warm, dry, safe housing is a human right and we cannot make this an issue over which political points are scored.  It’s real and it’s here now.  It needs to be dealt with.  And I am trying to figure out how best we deal with it.  I am sure our communities, social and business, have some great ideas.

Let’s challenge ourselves to get those great ideas on the table, put some into action and see what works.  If something works, we can do more of it.  If it doesn’t we can figure out other solutions.  This isn’t about money.  It’s about letting good ideas be tried out on the ground and collaborating not politicking.  Let’s give it a go.
Penny Hulse is the Deputy Mayor of Auckland

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18 Comments

  1. Lara says:

    Some good ideas for the supply side of the problem there.

    But nothing for the demand side.

    No solution will work if demand is not reduced. Which is actually very simple. And I’m not seeing any of the political parties speak up about it.

    Stop the sale of land and property to non NZ citizens and non NZ residents. Stop making NZers on their pitiful incomes compete in a global market with a huge pool of very wealthy people.

    • kevin says:

      Exactly. It amazes me how supposed intelligent people can miss the elephant in room, immigration & speculators (both foreign & local).
      It’s as if they DONT want to fix the problem !!
      I hear all the B.S excuses of what’s being done, as if we should congratulate the FOOL passing on their propaganda. It’s simple limit immigration & stop speculation.
      And the acid test when a Polly gives the umpteenth B.S spin is, how soon will your idea solve the problem? And when it’s in many years time, fire the idiot.
      The Auckland housing problems, as of today, not the post bubble busting problems is, link immigrants to housing availability & stop the clear & obvious rort by housing speculators.
      And when any Polly or expert tries telling you about another idea I guarantee they’re trying to confuse the conversation, to stop what they KNOW needs doing being done.
      When will Aucklanders take to streets and riot??

  2. bad12 says:

    Good to see Penny Hulse calling this National Government’s wholesale ransacking of the State Housing portfolio for what it is, IDEOLOGY!!!, nothing more, nothing less,

    We only need compare what occurred with the proposed amount of State Houses to be built in the Whenuapai development to know what is likely to occur within the recently announced ‘Tamaki initiative’,

    Several hundred State Houses were planned to be ‘pepper potted’ within the largely middle class development of Whenuapai, of course when there was opposition from those wishing to purchase to these State Houses this Government simply scratched a large red pen through the ‘plan’ and there will be no State Housing there,

    What the Government is proposing in particular with the ‘Tamaki initiative’ is to transfer the collective wealth of the poorest Aucklanders currently expressed in the Housing NZ State House portfolio in that city into the hands of the bloated middle class where some will become Homes, and, just as many will become chips in the ongoing game of Monopoly which is ‘investment housing’,

    That is the reality of ”unlocking the value held in HousingNZ’s landholdings”…

    • bad12 says:

      A big OOOP’s here, what i describe as the Whenuapai development in my comment above should have been described as the Hobsonville development…

  3. Mike in Auckland says:

    Thanks for sharing your position and ideas here on TDB.

    I am one of many submitters on the PAUP, and most submitters that cannot afford the representation by lawyers and planning and other experts feel totally overwhelmed and extremely frustrated with the process. This is not a truly democratic process, where we have mediation and hearings dominated by a select few, regular, well resourced and powerful business and large organisation submitters. Sometimes it seems that major decisions have already been made between Council and large, strategic and vested interest submitters. I just wanted to let this off before I go over to housing.

    While I agree we need some intensification in suitable parts of Auckland, there are many suburban areas where the bulk of residents are totally opposed to having their suburbs turned into ones that would be interspersed or even dominated by future Terraced Housing and Apartment Buildings. This would turn so far relatively quiet neighbourhoods into crowded areas where it will be more difficult to maintain a kind of functional “community”.

    So I understand both sides.

    What is going on in Auckland is now totally out of control, and I do not so much blame Auckland Council for this, while there have been many shortcomings by Council also, but Central Government.

    We have levels of net immigration never seen for decades, and most immigrants choose to come to Auckland. We also allow overseas buyers to buy property in NZ, without too much restriction, we do not even have a register for foreign buyers and home owners, which is incredible. Central government seems totally irresponsible in taking this total laissez faire position, which is causing endless New Zealanders to face a future as renters in their own country, no matter whether they earn well (close to median incomes).

    Of course the building is lagging behind, and that is another issue. For John Key to continue dismissing there is a crisis, and stating like a broken record, the market will fix it, and we need more supply, is irresponsible. He loses credit by the day, which is the only good thing about it.

    I fear that it is far too late for any consensus to solve this crisis, as we need to immediately put a break on immigration. And some mechanism is needed to incentivise immigrants to move to other regions than Auckland.

    The Special Housing Areas (SHA) and all other measures, even those in the PAUP, are a joke in my view. You want to tell people we get “affordable” housing by setting aside ten or so percent of total new build for buyers around the median income level, that in itself is a total failure, in my eyes.

    Only a massive state intervention, with a large state home building program, cutting out the landbankers, the speculators, and those that even use the SHAs now to get higher prices, will solve the problem. First though, block ALL cooperation with Central Government, withhold this, until they come and deliver, that is my view, as otherwise you open yourself up to being pulled over the table. I would take firm action if I was Auckland’s mayor and deputy, not try and talk with people who have shown often enough, they want it THEIR way, more greenfield development, more motorways, more private development and even foreign investment. Listening to the Minsters of Transport and Housing, it is clear that they do NOT want the rail system that Council prefers, they do not want more money on public transport, they still cling to more motorways, more roads and more of the same.

    I am sick to death of living in this city, it is not the World’s most liveable city I see every day, it is becoming totally unbearable, even just to cope with paying rent here.

    So that is what I feel I needed to say here, and I am sorry if some of this may sound a bit “rude” and harsh.

    • Janice says:

      It’s BS. NZ is becoming a joke country. Quite suddenly, I can’t afford to live here anymore. What kind of country is this, that it just holds raffles for people’s security? No loyalty to its citizens.

  4. CLEANGREEN says:

    Gisborne & Napier has a rental housing glut but these are among the numerous regions depressed by Planet Key as all the money is sucked out of the provinces to feed Auckland and Christchurch infrastructure.

    You can rent a three bedroom house for $270 a week there or less.

    We have one in each City now for rent, anyone interested?

    • bad12 says:

      Marvelous!!! Lets turn the pages of the Daily Blog into an advertising rag, ‘investment properties’ are they CleanGreen…

    • Brigid says:

      Well if you weren’t such a greedy landlord and reduced the rent on your properties PLURAL!!, you would have no trouble finding tenants. And you think $270 a week is reasonable rent? Gob smacked. Another chardonnay socialist .

  5. bad12 says:

    I have posted comments here at the Daily Blog and in other online forum about the fact that the NZ Treasury has previously produced figures which show that in the 20 years befor some 200,000 Homes had become ‘Rental investments’,

    That’s pretty much 10,000 properties a year , many of them i would suggest within the Auckland City boundaries,

    The driving force behind this flood of the monied New Zealand middle class into such ‘investment properties’ is the ‘free money’ involved to those who have, if you will excuse the pun, indulged,

    There are of course the free capital gains, there is also the cannot lose aspect of the available ‘tax breaks’ that such indulgences render to these nouveau ‘property investors,

    Simply put, when a property investors outgoings, mortgage,rates,insurance, repairs, property management fees exceed the income from the investment property, rent, then the difference is made up in favor of the property investor being able to claim a rebate on their ‘Personal income tax’,

    In effect, every poor working low waged worker coughing up 50 or 60 percent of their income to one of these ‘property investors’ in rent who cannot afford to even imagine buying a Home in Auckland or any other city for that matter is by paying their full amount of GST and Income Tax DIRECTLY SUBSIDIZING the investment aspirations of that whole cohort of ‘rental investors’ who have in the past 20 something years since this little ‘legal tax rort’ became available to them piled en mass into ‘rental investment properties’,

    i went looking tonight for a link to the NZ Treasury figures showing the numbers, 200,000 Homes transferred into ‘rental investments in the past 20 something years, tonight,

    While i couldn’t find that particular piece of NZ Treasury wisdom,( it is there somewhere, it appears i am not asking Google the right question), i did come across this little gem,

    http://www.stuff.co.nz/business/…/National-digs-in-on-foreign-ownership-ban...

    ”Treasury research shows that of 200,000 people claiming losses on rental property, 11 percent are non residents”

    ”It said that in 2011 just over 199,000 taxpayers had reported rental income losses through personal tax returns”

    ”Of those, 11 percent, or about 22,000 people, were non resident while about 2000 were of unknown residency”. unquote,

    Now befor we all get exercised over the 22,000 properties assigned to non-residents it has to be said that they are just as likely to be Kiwi’s who are overseas and are renting out their properties,

    What these figures say along with the numbers i have previously alluded to, 200,000 Homes transferred into ‘Rental Investments’ in 10 years, is that it is the ‘Free Money’ inherent in the tax breaks allowed to ‘property investors’ that has seen Joe and Jane Bloggs pile en mass into ‘rental investments’,

    This little ‘legal tax loophole’ works on all sorts of levels depending on the amount of tax any person expects to pay in any given year, of course you have to have the income and job security to be able to afford the initial mortgage on the ‘rental investment’ in the first place,

    But, if you haven’t the income to join the clusterf*ck of driving Auckland housing prices through the roof then you join the herd of ‘property investors’ currently playing monopoly with the housing stock of every other town and city in New Zealand,

    In some of the smaller places, where the census records in a lot of places a third of the town empty, you have no need of even one of those nuisances called a tenant, if you are due to pay enough tax in any given year you simply write off the whole lot as a loss and claim the cost of your ‘rental investment’ back from your personal income tax,

    Once enough capital gains are made to suit the amount of greed your little heart can contain, all paid for by the ‘tax base’,(you and me who cannot escape a cent of our due tax), you simply sell it off into the ongoing game of Monopoly,

    There i suggest is Central Government’s culpability in the clusterf*ck of housing unaffordability in Auckland and increasingly so in other areas of Aotearoa where once even the poorest of us might have had a chance of home ownership…

    • bad12 says:

      Just as a little ‘off topic aside’, but, alluding to the current Government’s duplicity surrounding State Housing,

      i will comment more on this in either Open Mic or other articles here at the Daily Blog when the ransacking of the State House portfolio comes up for discussion,

      Slippery our Prime Minister has publicly stated that ”Any State House sell offs will be to Private Providers of Social Housing”, on numerous occasions, i think that pretty much paraphrases Him in content and intent???,

      IF any of the readers are to believe that then i am afraid that you are easily fooled,

      i can, and, for the sake of ‘informed debate’ will at some stage, provide you with any number of State Houses that are being advertised, both on TradeMe and Realestate.co.nz that are being sold on the open market,

      In the smaller towns, the Taumarunui’s, Hawera’s, Patea’s etc etc this National Government with unbounded enthusiasm is busily selling off all the State House stock…

  6. Blake says:

    The focus seems mostly on home ownership when most middle and lower class folks can not even think or dream about it.

    Landlords in Christchurch cashing in $3000 ! and up ! each ! week! ripping off overseas construction workers and other unethical and greedy landlords should be more of the focus, I believe.
    Who can realistically afford to buy a house in the Auckland area unless you have two incomes and they are hefty incomes. Homes will continue to be bought by more and more overseas investors because most Kiwis can not afford these overpriced homes. Home ownership is only reachable by a small percentage of our population now and with National ( and greedy realtors ) at the helm, that will not change much at all.

    There needs to be more light focused on affordable rental homes and this is a major problem when we have so many greedy opportunists landlords. Lets focus on them and regulating them so that there will be more affordable rentals available in all cities. Most renters are paying WAY ! too much for what they are getting for the most part so lets address this ongoing problem – as well as affordable home ownership.

    These Christchurch landlords ripping off these workers is disgusting. Thank you Campbell Live for showcasing this.
    How many other landlords (nationwide) are taking advantage of of and ripping of hard working folks ? More than we know.

  7. EE says:

    “collaborating not politicking”. What about “collaborating and politicking”?
    I attended a meeting with Auckland Council Planners about the Special Housing AreaS (SHA). One of the planners explained how low cost options will work in those areas. An apartment will be sold at a reduced market price to someone who qualifies for low-cost housing . They must live there for two years, afterwhich they can on-sell the property at the market price.
    Giving someone that opportunity to step on the property ladder is better than nothing done, even if that ladder is kicked away soon after. It seems to me that loopholes in this arrangement will be ripe for exploitation by the developer. The other winners will be The Government and Auckland Council who will be able to say they have helped create X amount of low-cost housing. Even though it has evaporated by the next election.
    What about creating permanent low-cost housing?

  8. countryboy says:

    Ms Hulse . You must have mistakingly lost my comment of a few days ago . Here it is again, for your convenience .

    ” This isn’t about money. It’s about letting good ideas be tried out on the ground and collaborating not politicking. Let’s give it a go.
    Penny Hulse is the Deputy Mayor of Auckland ”

    Ahh, yes it is about money. More over, it’s about the 0.01 % who’ve made off with export revenue earned from 174 years worth of hard farmer graft . You may be familiar with that money . It built Auckland . If you don’t know where that money is then some of it is in the skyline outside your office window. There’s quite a bit more of it on Mercury Island , and Island belonging to Michael Fay , and look along the waterfront . See those high falooten yachts and gin palaces ? Yep, you got it . There’s more of our money.
    It’s not in our coffers, it’s no longer in our infrastructure like housing, like health, like pensions, like hospitals , like public AND freight transport, like OUR electricity , like our Telecom systems , like our dental and was in our state housing but scum bag politicians are selling those off to developers . That, by itself is money AND politics.
    You ever try and build a house with good ideas and no money ? The good ideas become stagnant and die and good people just get drunk.
    I would go so far as to say that your entire Post was one long winded logical fallacy.
    I say fuck the good ideas and lets find out where our money is and who took it and then lets have us an inquiry and an imprisoning .
    Or, or here’s another idea . Make poor people with a few skills exempt from insurance requirements and let them build what ever they like out of recycled materials. Ya know , like the materials dumped and buried in Ch Ch . A crime and a shame if I must digress . How about a funky shanty town with piazzas and a weekly farmers market . How about free electricity and work shops to learn plumbing and joinery ?
    I can hear the Banks and Insurer lobbyists scrambling for the keys to their BMW’s as their PA’s frantically call their politician mates to remind them of their owing favours for all those cocktails and hookers in those expensive hotels in far off island paradises .
    I say to Hell with working around the housing crises all snuggle-fur and collaboration-like. I say lets get the bastards who brought state housing down and turn the fuckers inside out .

  9. Dangerous Dave says:

    “We have our Special Housing Areas but imagine if we could get houses built faster by getting government to unlock the funding for the critical infrastructure to service those areas. We are standing up for Auckland and the government must do its bit.”

    Penny, with the greatest of respect, the Auckland this Council is ‘standing up for’ is not the Auckland I want to live in. Your Auckland is a high-density quagmire where everyone lives in a shoebox, with the sole objective of fulfilling your misguided obsession with public transport. That’s not the Auckland I, or virtually any of my circle of contacts, want to live in.

    I invite the Govt to step in and take control of the dysfunctional council we have, immediately abandon all work on the inner city loop, and focus public transport investment on linking greenfield satellite communities, where housing will be affordable, and where communities can preserve the kiwi lifestyle, not try to emulate the Hong Kong one.

  10. High Tory says:

    The politician claims people in Auckland want to live in apartments, thats true, but not the people who want to live in houses. Its obvious they are two different markets, with apartments catering mainly for singles and young lovers. Apartment rents are stable, while housing costs are on escalator.
    The real cause of the price rises, is speculation and the fact that neither China or NZ is turning off the tap. China in reality is a military dictatorship. Both nations control their borders. NZ Bill English et al has gradually relaxed the entry conditions for numerous groups, barring official refugees. The claim of the National Government that they have no control over immigration numbers is clearly false.

  11. High Tory says:

    The key point is at the moment China is being nice to us, buying our milk powder and buying our houses to sustain the bubble economy. It is China’s interest at the moment to be a good and generous partner. But things could change. Of course in the world of Bill English, Stephen Joyce and Tim Grosser, everything will continue as normal. To them it is certain as the rise of the Sun.