Work like a maniac, deprive yourself of sleep, and you might be able to buy a shitty house in Hamilton

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Recently the NZ Herald posted an article, ‘Student becomes property investor’ about a young 22 year old student, Brandon Lipman who, ‘against all odds’ and through ‘hard work’ managed to scrape together the $45,000 needed for a deposit on a house in Hamilton, New Zealand. Wow. This is an impressive feat in the current housing market in New Zealand, particularly in places such as Auckland where housing prices are spiralling out of control and wages are still as low as ever. The NZ Herald reported,

“The keen basketball player saved the money while studying towards a commerce and science degree, working from 9pm to 5am each night at Countdown supermarket during his first year,”

Through what Brandon calls ‘sacrifices’ and ‘hard-work’ (and a lot of help from his parents), he has been able to secure buying his first home before he has even finished his degree.

Be, inspired!

If Brandon can do it anyone can. Sounds easy, right? After all, Brandon is living proof that the New Zealand dream of owning property is possible at a young age, despite our hard economic times.

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There are three words for all of this: Utter. Fucking. Bullshit.

I have something to say to Lane Nichols who penned this article on Brandon (where do they find these people? Probably, on the mean streets of Parnell) and the NZ Herald at large, who often push bullshit stories like these, as some kind of underdog triumphant that we should, and can, all aspire to:

Please stop painting upper-class white men who managed to step-up on the property ladder through ‘sacrifice’, ‘hard-work’ and good old fashioned ‘elbow grease’ as some kind of ‘underdog’ story. They aren’t. As my friend aptly said in response to Lane’s article “I reinvented the headline for this: Privileged White Man from the Upper-Middle Classes Trades Personality for Property Portfolio”.

Sometimes the international papers such as the New York Times , also make out like Taylor Swift is some kind of ‘underdog’ who faced huge adversity before she ‘made it’ in Hollywood with her pop songs about dating famous dudes who also sing shitty pop songs through auto-tune. The reality being, Taylor was born into to the one percent, and her daddy bought into the record label she was signed to. This is called: A MASSIVE LEG UP. Obviously, Swift is not an underdog; she was born into the rich elite and has benefited, like I do to, greatly from white and class privilege. Hard-work was not the only thing that got Taylor to the top of the billboards, by any means.

You know what happens when poor people get a ‘leg up’ from the state? The right-wing and the centre right shame them for it and call it a ‘hand out’. The poor and working poor are told they are feckless and lazy and are undeserving of any kind of state help or ‘leg up’. I thought it was worth pointing this hypocrisy out.

What this all means is: if we as ~ individuals ~ fail to rise above the poverty line, fail to secure well paid work, and thus fail to save for a house deposit and in turn fail to achieve our dreams (even if they are as humble as securing meaningful, well paid work), it is our own fault. We did not work hard enough. We made bad life choices. You, are just a bit of a loser. It is not the fault of a failed economic model and the savagery of late capitalism that only serves the super wealthy at the expense of the 99 percent. It’s not the fault of retired National politicians like Ruth Richardson whose budget reforms in the early 90’s in Aotearoa, known as ‘The Mother of all Budgets’ eroded welfare, job security and landed young people with crippling student debt. Your failure to do well economically, has nothing to do with a minimum wage that does not cover rising living costs in Aotearoa.

Nah, let’s never EVER hold power to account? Something journalists in this country seem to refuse to do apart from rare exceptions such as John Campbell, whose current affairs show was recently axed. Let’s just blame people for their unfair and depressing circumstances, not what created these circumstances in the first place.  To compound feelings of worthlessness, frustration and failure that so many people who are struggling to stay afloat and buy food (let alone a house), are feeling right now, the NZ Herald and the New York Times hold up shining examples of young people, who are nearly always white and come from wealth, such as Brandon and Taylor Swift (seriously?) who ‘made it’ in tough economic times and/or through [manufactured] ‘hardship’. So why can’t you?

The NZ Herald ran a second piece ‘Property Investment not a reality for students – Association’, in response to mounting criticisms of Lane Nicolas’s profile piece, pointing out, that perhaps Brandon’s story of triumph was not a fair representation of all students. The article quoted Rory McCourt, who is the president of the student association, saying “Most students are wondering how they’ll afford next week’s rent or ever pay back their mounting loan. Mr Lipman’s story is the exception, not the reality,” but Brandon still insists in this second piece that hard-work can, and does pay off. “Everyone puts up with different things,” said Brandon.

Yeah we certainly all do, have to put up with different circumstances, like sole mother Trina Nesbitt who is living in a caravan in Christchurch, with her two kids, because she cannot afford the city’s rental prices.

I am part of a generation that has been locked out of the housing market and this reality is not going to suddenly change because I land a minimum wage full-time job at a supermarket and work long shitty hours, stacking shelves.  How on earth Brandon managed to save $45,000 in just a few years even with his parents paying for his living costs is, beyond me. As a low waged earner working two jobs in the service industry, I can tell you the math, simply, does not add up.  North and South recently quoted Shamubeel Eaqub, principal economist for the NZ Institution of Economic Research, saying,

“[…] the average house price in Auckland has spiralled to ten times the average income of a couple in their 30s. That means most young New Zealanders – including those now in their teens – will never be able to afford a place of their own.”

We have been told, as young people, that if we endure a little bit of ‘discomfort’, we’ll be better off, both financially and spiritually, in the long term. This is a brutal lie to tell young people. The idea that hard-work will get you anywhere in our society of ‘haves and have nots’, where structural poverty, racism and sexism disadvantages large sections of society, is nothing more than neoliberal myth making.  In the Book Ruth, Roger and Me: Debts and Legacies 27-year old author Andrew Dean writes,

“My Generation of New Zealanders has been told that being uncomfortable will make us work harder and strive further. We have been bought up on what Ruth Richardson calls the ‘stiff medicine’ of her reforms, and now we must be healthier for it.”

I am tired of examples like Brandon being held up to my generation as proof that if you swallow Ruth’s ‘stiff medicine’ and work like a maniac and deprive yourself of the necessity of sleep, you too can buy a shitty house hundreds of kilometres from where you live.

 

A version of this blog will also appear on Posse.

 

 

 

 

 

 

 

 

23 COMMENTS

  1. What rubbish. If he saved $45k while studying, someone else was feeding and housing him, paying his medical, travel and other incidental costs and most likely his student fees. I’d say someone else was doing his assignments as well. Every student knows if you work all night, you’ll sleep through lectures.
    Stupid herald. What a dreadful rag it is

    • Yes. And as someone else pointed out on The Standard, if he was working that many hours and studying, it is likely that his parents (who he was living with at the time, rent-free) were paying ALL his utilities, making his meals and doing the housework.

  2. Excellent article Chloe,

    I have my daughter who bought in Gisborne and $45 000 would buy half the “basic”average three bedroom house in a “not the best street” in Gisborne today.

    So yes folks if you want a home cheaper, you should look afield for more cheaper homes than Auckland.

    Lets be real here, as the bubble wont last forever and when the bubble bursts look out everyone, there will be massive turmoil alright like I saw in Toronto in 1991 when that bubble burst and a third of the homes for sale went into ank repo’s and it takes decades for the economy to recover from this in those overheated markets.

  3. Yes…back in the 1930’s Labour acquired land to free up for massive housing builds – this neo liberal govt wont because it will gut housing demand and bring mortgages and rents down as well as kick the speculators in the nuts.

    They wont even admit there is a housing crisis for the above reasons.

    Hell ! – they wont even admit the minimum wage doesn’t even keep up with the cost of living – to do that would be to raise the question about the validity of neo liberal economics being a ruthless failure – which it is.

    Bill English ( the Double Dipper from Dipton ) loves a low wage economy – because it encourages foreign investment. And that’s the way neo liberals from both National and Labour love it – plenty of heavily indebted students and working poor and unemployed to keep em all on the treadmill.

    A great big fat pool of peasants .

    And while you struggle to aspire to a mirage – ( a house ) they happily glean ever increasing profits from these ‘ foreign investors ‘ through dividends.

    And buy another rental mansion .

    Meantime …to keep the lie afloat , we get fed shallow ‘ success ‘ stories like the one that heads this article.

    Its called bullshit and jellybeans neo liberal propaganda.

    Been a recurrent lethal disease in this country for the last thirty years or so. And fast entering its terminal stage. The whole edifice and structure built on lies is about to take a hit in the next few years – if not sooner.

    And when that house of straw comes crashing down , the wailing and gnashing of teeth will be heard across the length and breadth of this nation.

    But be of good cheer – that’s the time to go house hunting for all those who have been locked out for so long.

    Sad though…that it would take something like that to finally drive the nail into the heart of these neo liberal vampires.

    And ….for all those neo liberal zealots who jump to immediate conclusions – yes I too ran a business employing 6 people , did up a house and made a lot of bread (after selling another cheaper one ) along with a mate when I was student and had a property which was worth today around a mil – and was going to add to the portfolio….

    But then came 2008 , and like a mid western farmer during the Great Depression of 1929 closed the gates for the last time and drove off.

    Even had to give my fuckin dogs away you neo liberal bastards.

    So…lost my property , my business and my bloody dogs.

    As a wage earner back in the 1980’s in my early 20’s I earned more then , …. than I do now.

    Welcome to the bullshit ‘ rockstar economy ‘.

    Absolute bulls – arse con job.

  4. The messages in the Herald should only be read by those with strong critical thinking skills as this article demonstrates.

  5. Indeed. If you ask the government for money when you are already rich, it is considered an “investment”. If you are not rich then it is a “hand-out”. Shouldn’t this be the other way round? If you give NZ’s children and families a leg-up to help them learn better, live more comfortably and happily then this this surely helps them to be more productive, happier and healthier thus costing the state less money in the future? If you give a leg-up to multi billionaire yacht owners so they can race each to satisfy their own egos, what is the financial and social return for ALL of NZ from this investment? sweet f.a!
    This would not occur to the self appointed journalists of the Nat Herald.

  6. Yes exactly, Utter…Fucking…Bullshit an apt description of a NZHerald story that is full of both outright lies and lies of omission from the first sentence to the last,

    When addressing exactly what is going on here with such ‘investments’ there is the problem of this structured industry of individualized tax evasion, which is what is in fact occurring on a mass scale here in New Zealand, being far to complex to simply address as a whole with a single comment,

    Lets then firstly provide the basic numbers from the scant information available, using 2011 information the Reserve Bank recently said that there were 199,000 New Zealand taxpayers declaring ‘tax losses’ on ‘rental investment property,(in the year 2015 i would suggest this number will have increased to 250,000 taxpayers),

    The director of the Property Investors Institute recently pointed out that these ‘investors’ usually have 2 such properties,(which would indicate the number of Homes involved to be about 500,000),

    The point i wont to stress in this my first comment to this Post is that these people ARE NOT buying these properties in any ‘normal’ sense of that term that any ‘normal’ person would understand,

    What ‘normal’ people understand is that Ma and Pa, looking for a Home to raise their family in approach the Bank for a mortgage, based upon the amount of their deposit, their household earnings, and, their likely success at being able to pay off that mortgage Ma and Pa if such a mortgage is granted then every week pay to the Bank a portion of the yearly interest on the principle amount of the mortgage, and a portion of the principle amount of the actual mortgage, along with this Ma and Pa pay rates and insurance on the property,

    What the ‘property investor’ does is approach the Bank for an ‘interest only loan’ both the Bank and the ‘property investor’ at this point ‘know’ that there is no intention to ever pay any of the principle amount of the mortgage,

    So, such ‘investors’ as gloated over by the NZHerald ARE NOT ‘buying’ the property in any sense of what a ‘normal’ person would understand to occur when purchasing a Home via a Bank mortgage,

    At this point both the Bank and the ‘investor’ have created a ‘financial instrument’ which they both know will be used as a ‘tool’ to avoid the payment of due taxation,

    Unlike Ma and Pa buying a Home for them and the kids, the ‘investor’ is not examined for an ability to service either the principle of the mortgage, the interest payments on the mortgage,or, the rates and insurance costs of ‘holding’ the property,

    The ‘investor’ is examined befor the granting by the Bank of the ‘interest only loan’ as to whether the ‘investors’ due taxation on any activity including the ‘investors’ wages and salary are the same or more than ALL the costs of the property for which the ‘interest only loan’ is being sought from the Bank,

    Lets just leave this comment here, remembering all the time that the ‘investor’ Never At Any Time Intends, or Intended, To Pay Any Of The Actual Principle Amount Of The Mortgage, and, the ‘investor’ and the Bank both Know this,

    And, right there the seed is sown, the genesis of what will be an ongoing systematic structured series of annual tax evasions by ‘the investor’ aided and abetted by the Bank….

    • Yep nanny Herald, right-wing bullshit mouthpiece. Its motto for the new millennium looks pretty impressive in Latin:

      Numquam de bono adepto in via veritatis factos, qui cum imperio conservativum suffragatur .

      Never let the truth get in the way of a good story, especially when it supports the conservative government.

      • Aye …truly lovely to hear .

        I love a good recourse to linguistics and history to teach a modern hedonistic barbarian generation a thing or two from the wisdom of the past.

        Much appreciated . Thank you.

  7. The NZ Herald wins this months Joseph Goebbels award for propaganda. Queue slow hand clap!

    Its a fact that Key and National want investors in the Waikato so I assume this was the dog whistle article to set the ball rolling that is firmly stuck in the mud.

    See you lefty bleater’s, see, with an education, hard work and growing your own vegetables you too can buy a home. See, Mike Hosking along with the entire Newstalk ZB line up and their callers were right after all.

    The Heralds candidate manages to work 36 hours a day and sticks a broom up his arse and sweeps the floor simultaneously whilst studying and buying his 3rd investment home, all at 22. Oh my God, Amazing!

    This crock was up there with Stephen Joyce’s hilarious claim that Northland had somehow created 3000 management jobs.

    Ironically a relative of mine recently sold up in Hamilton after a decade in a nice suburb and lost on their home! So reality is a little different!

  8. The situation that truly progressive and left fighters for justice face is stern and highly worrying. We have the greatest challenge in front of us, that there has been since Roger Douglas took control of much of what the Labour government did from 1984 onwards.

    At present it seems, only the “middle class” matters, and hence this idiotic report on the lone one young man, who “managed” to get into a house at a very young age, supposedly as a “struggler”. The media love such stories, that appeal to the comfy middle class, and mislead others less well off, that they “can make it too”.

    On the weekend we had TVNZ (thanks to Corin Dann and others for raising the matter!) report on the government’s plans to introduce “social bonds” to finance new programs to “assist” mentally ill on benefit and healthcare into work. This is the most hideous measure of all that we have seen since the draconian welfare reforms took effect in mid 2013!

    Already the present “trials” with contracted service providers are a privatisation measure, where the “incentive” given to these agencies is to earn high fees, for placing persons with mental health conditions into whatever supposedly “suitable” jobs.

    We get stuff all transparency, no figures on how many are actually put into jobs and for how long, with what success or problems that may have been associated. We know nothing about the kinds of jobs they get sent to, and we learn nothing about which agencies failed or had troubles, as all this does no longer fall under the Official Information Act responsibilities of MSD and the contracted businesses.

    What we get is more of this, and in more ruthless, more cunning and risky ways.

    After much debate about this, after protests and extreme concern expressed on social media, on The Standard blog and even in some mainstream media (it was though basically only TVNZ and Radio NZ that bothered digging into this a bit), we had Labour and Green MPs feel forced to ask some hard questions in Parliament on Tuesday.

    Since then we have observed that the issue is now more or less “water under the bridge” again. Parliament moved on, so did the MSM. So the affected will be prey for the MSD agenda, the players that will try to “invest” and make gains from new trials. It will all be done behind doors, and we will not hear and see much if anything about what goes on.

    The wider public are simply no longer interested, it seems, there are no protests, no questions raised, as everybody is now happily or not so, too busy with the daily challenges and how to keep on top of things.

    Then we even had Annette King pipe up in Parliament yesterday, saying to Jonathan Coleman, that Labour already had such “experts” in PHO Offices when they were last in Office, to help sick and disabled into work.

    It sounded damned defensive, it sounded like another cop-out.

    Labour seems to have put the issue of “social bonds” at low priority, and they will likely do the same if they ever get back into government.

    I am appalled about the callousness of our politicians, on both sides of the House. Here they try to make some quick propaganda gains one way or another, the opposition with much hand wringing, but hypocrisy, as the welfare reform agenda was in moderate ways already started under Labour, where already in 2007 the controversial MSD “Principal Health Advisor” Dr Bratt (the benefit – drug comparer, you know) was appointed!

    I see and hear NO real and serious opposition to this privatisation of welfare and other social and health services, and I find this scandalous.

    We have now no real opposition in Parliament that really, honestly and decidedly takes action against the callous attack by this government on the weakest and the poor. All Jan Logie came up with was, asking Jonathan Coleman for an assurance that mentally ill and sick will not be pressured into unsuitable work, which Coleman denied, claiming their contracts would ensure this.

    Would anybody believe that Minister, would you believe Annette King is really honest about what she may say and ask?

    Ask her and others in Labour, whether they would reverse the draconinan measures, and they will find every excuse to not give you a clear answer.

    We are being betrayed, tricked and misled, again and again, it is time to take action, to speak out and act, outside of the political establishment, and outside of Parliament, and expose the rot and lies not only of the government, but also those that stand by and just offer hand-wringing comments and no more.

    It is time to remove this suit and tie brigade sitting “above” us there, and pass laws that make life increasingly unbearable.

    I have NO TRUST anymore in any of the politicians in Parliament, it is time to start a movement, an out of Parliament opposition. We cannot rely and a compromised, useless media, that only caters for comfortable middle class citizens but noone else.

    Take action, speak out, protest, picket, sabotage (without getting yourself into legal trouble though), inundate them with demands, protests, challenges, attacks by email, social media and whatever communication there is. I had the guts full of what happens in this country!

  9. I agree with you Chloe, but beware. Perhaps there is a deeper Crosby-Textor strategy here? Bait the Opposition into attacking the privileged young white man and his house buying. Then encourage any young white man who aspires to buy a home to see the Opposition as the enemy of that dream. Claim the Opposition intend to condemn you to a surveillance state landlord in the name of public/ social housing bla bla bla. Encourage them to vote National to protect them from this “communist” pro-state Opposition.

    We must be careful not to rise to such bait. While agreeing with the Students Association rep that Brandon’s case in an exception, I wish him well. But I would caution him that he will do better, as a citizen and as a private landlord, in a society in which most people aren’t struggling to afford market rents, and angry with the people who charge them.

    We also need to keep in mind that the problem with housing has nothing to do with supply. I guarantee there are enough houses in Aotearoa for every permanent resident to own one (whether as an individual, a family, or a cooperative). But we compete with demand from the *entire world* to own one. Even if there were 4 houses in NZ for every person who lives here (which would be an absurd waste of space and resources) this would not bring housing prices down.

    In most countries only people who live permanently there can own land. Opposing foreign ownership has nothing to do with ethnicity. People of any race who live permanently in Aotearoa have a right to own a house here. People of any race who don’t live here, don’t. Simple as that.

    Finally, on the subject of privatization by stealth, it’s high time we did away with this “commercial sensitivity” garbage. Any organisation (business or QUANGO) who provides “services” on behalf of the state, funded by the state, has the same moral obligations of transparency as a government department. We have a right to see their budgets, OIA them etc, just as if they were government departments. If that puts businesses off taking corporate welfare, so much the better.

    • I agree, we don’t have a problem of supply, we have a problem of demand and distribution of existing supply.

      I live in a small seaside holiday town. It’s winter. Most of these houses are empty. They’re second holiday homes. There are plenty of empty houses country wide.

      The last census apparently found about 20,000 empty homes in Auckland. The question must be, why are they empty? Are they under construction? Uninhabitable? Owned by “investors” parking money hoping for capital gains? The latter is happening in London I hear, it’s quite a problem. NZ allows anyone at all to buy our land, so it’s entirely conceivable it’s happening here.

      The solution is remarkably simple. Cease ALL land sales to non residents and non citizens. To buy land in NZ you need a NZ passport,birth certificate showing you were born here hence a citizen, or a Permanent Residency stamp in your foreign passport. All land owned by non residents and non citizens must be sold within 5 years to a resident or citizen. Watch the market correct overnight.

      Is there any political party with a policy like this? Maybe NZ First?

      • Now THAT …..is truly awesome.

        THAT is the substance of standing up and being counted.

        And I would hazard a guess that NZ First would have something along those lines. Its just a pity that it wasn’t a more common attribute among Kiwi’s ….to stop being so cringing about actually having a strong sense of nationhood.

        We are a NATION – not an open shop to sell all wares to all and sundry .

        A NATION – not a pimp advertising for the lowest bidder.

        A NATION – not some ragtag bunch of beggars desperate for patronage – they need us more than WE need them –

        THAT’S WHY THEY COME HERE – TO SPECULATE !!!

        And its time it all STOPPED !!!!

      • Yes 22,000 empty homes in Auckland, there are legitimate reasons why many of these Homes will have been empty during the latest census, But, a proportion of these empty Homes will be ‘Ghost-Rentals’

        There are ‘Ghost-Rentals’ all over New Zealand, whenever any particular town becomes of interest to me in a ‘news’ sense i usually check it out online including having a wee gig at the census data,

        What i find in many of these places is up to a third of Homes have been empty and when i cross reference these places with the real estate for sale on the various web-sites i find that even tho the populations in the smaller places are falling over two or three census periods, the asking price of real estate is rising as a % as fast as that of real estate in Auckland,

        That of course is counter to what would be expected in a ‘free market’, suggesting (a), that the prices in these smaller towns is being ‘fixed’,(presumably by the real estate/property management/valuer troika having formed a cartel to generate for themselves a revenue stream),

        What it also suggests is that property in these smaller towns is also being used by the speculators as ‘Ghost-Rentals’,

        Lets tho look at the empty Auckland Homes, not all of which will be ‘Ghost-Rentals’,

        To put a number to just how many of these 22,000 empty Homes are in fact ‘Ghost-Rentals’ we would have to take an educated guess,

        What we do know is that currently 40% of Homes sold in Auckland are to ‘investors’, so, up to 8800 of those empty Auckland Homes may be being deliberately kept empty, used as Ghost-Rentals for the purpose of tax evasion,

        To understand this, the top end of tax evasion carried out by the ‘investors’ you need to understand the Tax Rules surrounding the claiming of losses on such ‘investments’,

        The ‘rule’ is simple, to claim losses of a rental investment the property must ”be available for rent”, that’s it, imagine the slight amount of cunning you would need to prove that a rental investment is ”available for rent”,

        The Tax Rules, totally primitive, and, easily circumvented by the smallest amount of cunning you could imagine when coupled with the investors ability to obtain from the Bank an ‘Interest Only Mortgage’ make the ‘Ghost-Rental’ a must for the monied tax fraudster,

        The tax fraudster/investor having obtained the property via a ‘Interest Only Loan’ having occasionally advertised the property for rent but never accepting a tenant is now allowed under the Tax Rules to claim ALL the costs of the property, and,(the important bit for the tax fraudster/investor), as the property is available for rent but has no income from rental, the tax investor is allowed to claim those costs against the due income tax on his/her wages or salary,

        To be operating a ‘Ghost-Rental’ in Auckland the tax fraudster/investor would need to have quite high taxation due on his/her wages or salary,

        A $500,000 property ‘obtained’,(because the tax fraudster/investor never intends to actually pay off the mortgage, just the interest due owed to the Bank on that mortgage), would have the yearly interest payment to the Bank being around $25,000,

        Having fulfilled the requirement that the property must be available for rent the tax fraudster/investor with the ‘Ghost-Rental can now claim all that $25,000 back from the IRD on taxes paid on his/her wages or salary,

        Along with that Rates–Insurance–maintenance costs–etc etc etc can all be claimed back from IRD from taxes on the wages or salary of the tax fraudster/investor,

        Call it 30 grand a year all up that the tax fraudster/investor can grab back off the IRD by simply having a property with a ‘Interest Only Loan’ available for rent but never actually tenanted,

        Nice work if you can get it right???…

  10. Another rubbish article from the Daily Blog, me thinks you are a wee bit jealous of someone who has made the sacrifices. I know why you are left wing and it is because you have no talent or work ethic so you want everybody else to pay taxes to subsides you. No doubt you have a degree in the liberal arts and can’t understand why you have had so much difficulty in securing employment. Meanwhile the rest of New Zealand who voted against a left wing government gets on with life and looks at you for what you are, a moaning spiteful loser.

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