To the Housing Minister
Dear Nick Smith, who cares if these 22,000 Auckland homes are being kept empty deliberately, or is just careless?
You’re the Housing Minister, how about some legislation to allow councils to penalise this obscenity with a sliding scale of punitive rates increases, until this ugly phenomenom is done away with.
Such a measure from your government as well as addressing homelessness, would also ease the dangerous housing bubble, that threatens to blow up at any time.
There needs to be a time limit put on the vendors of houses, from keeping houses empty as a ransom, to drive up the prices further, prices that even now desperate first home buyers are already struggling to meet.
But maybe rates increases for parked up houses requiring government legislation is not the way to go.
Maybe the Councils could start taking action with bylaws and fines instead.
Councils impose fines on car owners for parking up their cars, hogging a space, that prevents others parking.
How about Council impose fines on house owners who park up their empty houses, preventing families being housed.
Ask yourself this question:
House Parking, or Car Parking?
Which of these antisocial behaviours is worse?
No one likes empty houses in their street, they attract crime; Detection and enforcement would be easy and cost effective.
Any parked up houses on your street? phone 0800 PARKED UP. let your council know.
Nice idea, but guess who the fines get passed onto?
Surely you can do better than this Himsee?
A panicked knee jerk objection, like this, tells me that I may be on to something.
Obviously Himsee, in the first case the fines get passed onto the owners of empty houses. They can’t pass them onto the tennants because they don’t have any. Nor do they get passed onto the home buyer, because if the house is sold to someone to live in it doesn’t accrue any fine to pass on.
The fines could be set at a level where they are punitive not fund raising. The sole purpose to end homelessness, and deter this anti-social behaviour, and free up the housing market. And not to raise money for the council by way of fines.
In the second case any fines would accrue to the council lessening the burden on home owners who actually own a house because they need somewhere to live.
In the third case, set the fines at a level in which they are to be avoided rather than paid.
The purpose is not fund raising, but to end the artificially created “housing shortage”.
Make the fines so exorbitant that the owners rush to tenant, or sell them.
The same as we do for parking tickets, where people will run to beat the meter.
If the owner is still too bloody minded or careless, to tennant or sell their property and racks up huge fines for ‘over parking’, just like in the analogy of the illegal car parker, they get towed. And their property is impounded by the council, until the owner pays the fine. If the offender still refuses to pay their fines then the council, will sell the house, at a rate determined by the Council and who will deduct from this sale the owed fines before returning the remaining balance to the house parking offender.
I am sure that the hard done house over parking offender will earn even less sympathy from the public than the over car parking offender.
This morning on Radio NZ National a spokesperson for landlords justified impossible high to pay rents but saying it was just supply and demand. Now I am not a believer in markets but that man’s response is particularly ignorant because Neo Classical Economics 101 deals a little with elasticity. And that figure of 22000 shows what happens when the elasticity of demand is fixed and that of supply is extremely elastic. A person (and I am deliberately ignoring the relative few who exist on the streets) needing a roof over his/her head must have it and has little elasticity. They can reduce the number of rooms so that 20 people live in a house but there is a physical limit and the health and social limits are a good deal lower. That’s the demand side – no elasticity. On the supply side we hear of 22000 unused properties which indicates a great deal of elasticity. When supply and demand have such different elasticities there is a great deal of power in the more elastic one. We see the same with labour markets where if I don’t work today I have lost that ability forever but if the man can get the job done any time to an extent, ie if the job isn’t done today it can be done tomorrow.
The mindless comment “it’s about supply and demand” is a simple refusal to face up to the power imbalance in markets of this type while also ignoring the fact that market institutions are social constructs. And neoliberal markets are constructed to bolster the power of the capitalists.
As house prices rise, especially in the bigger cities, we can expect the number of ‘ghost houses’ to increase,
Because the ‘Tax Rules’ are specifically written by the Politicians to favor ‘Rental Investors’ with loopholes a bus could be driven through it becomes apparent that any number of these empty 22,000 empty Auckland properties and tens of thousands empty properties nationwide are in fact ‘ghost rentals’,
‘Interest Only Loans’ have now become an entrenched tool provided by the Banks which allow the ‘investors’ to ‘hold’ property for up to ten years without having to pay any of the principle on such loans,
How much rent does the average ‘investor’ have to charge a tenant on that 700 grand ‘investment rental’???,
None actually, the deliberately written ‘Tax Rules’ would strongly suggest that such ‘investors’ simply keep the property empty but ‘available to rent at the market rental for the area’,
Should such properties be ‘available to rent’ then the tax rules allow the ‘investor’ to claim back ALL their COSTS from the IRD from any of their other income including taxes owed on wages and salaries,
Welcome to the Greece of the South Pacific, where politicians have arranged the tax rules so them and theirs have a legal channel of evading due taxation that is immensely profitable,
Aided and abetted by the Banks such Tax Rules allow the whole cost to the investor with a ‘interest only loan’ to be borne by the IRD,(in other words you and me), through tax write offs,
All interest payments and Bank charges,
Rates and Insurance,
All maintenance,
Just a few of the ‘costs’ to the investor which will be paid for from taxes owed that the investor will not pay,
Nice work if you can get it, you and me pay for the ‘investment’ by paying our taxes every day of every week and whenever the investor decides to flick on the property that they haven’t paid a cent for they will also get to pocket the tax free capital gains….
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