The neoliberal NZ experiment has spawned a baby boomer subdivided middle class whose only illusion of wealth is the increasing property valuations generated by unfettered over seas buyers and slum lord property speculators.
Imagine what a political party designed to represent New Zealand’s young renters would do if it got into power in Auckland or Wellington.
Let’s call it the Generation Rent Party.
Wooing the young and disenfranchised vote certainly won United States President Barack Obama his second term, but it was clear after last year’s election that no one has managed it in New Zealand.
Let’s imagine if they did. What policies would they pursue?
First, they would try to make housing affordable again for first-home buyers who want to start a family before they turn 40 without having to beg parents and grandparents for money.
Or they would at least try to make rents consume less than 30 per cent of their disposable income.
House prices in Auckland are rising again at double-digit rates and rent inflation is accelerating into the higher single digits.
The median house price in Manukau was 25 per cent higher in January than a year ago.
Record high net migration, heavy buying by property investors pumped up with interest-only mortgages and unfettered buying by non-residents has combined with chronic under-supply to pump up prices.
…those forced to pay for their own education and their own retirement are finding it near impossible to enter a housing market dominated by those who haven’t. Even the Reserve Bank is realising greedy NZ property speculators are the problem…
The Reserve Bank is looking at tightening up on how much banks can lend to residential landlords.
The central bank has confirmed it is consulting on new rules for residential property investors, opening the door to new requirements for owners of rental properties.
After months of of speculation, the Reserve Bank said it was looking at creating a “new asset class treatment for mortgage loans to residential property investors” within its capital adequacy requirements.
The issue of residential property is increasingly political, with critics claiming the loan to value ratios established by the bank last year may have made it harder for first time buyers to get on the property ladder, but not for those with a portfolio of rental properties.
As Key looks to test 5000 state tenants to throw out onto the streets, the reality is we need less market forces and more direct State investment.
20 000 new state homes with new loan schemes to allow beneficiaries to buy their state houses alongside a capital gains tax, land tax and property speculators tax is what is needed, not slum lords and overseas speculators. 4 bedroom Apartment buildings for first time home owners in central cities would allow Gen X and Gen Y entry into the property market and a vast new building program would connect our forestry industry to training schemes and work programs.
The current plan to gut the RMA so that 500 year old tress can be cut down for more urban sprawl subdivisions rather than central city and central suburb intensification rely on cheap immigration to keep pushing prices up. This is bubble building economics designed for short term political gain at long term social damage.
We require new law cementing in long term tenancies with rent controls and the promotion of ‘ethical landlords’, people who refuse to squeeze every last drop of money out of their tenants for needless greed.
Our social inequality demands solutions, renters rights and affordable housing is part of that solution.