In 2011 I filmed my documentary Inside Child Poverty mostly in Porirua just north of Wellington. I chose it because East Porirua is one of the most deprived areas in the country.
I showed how the housing problem – the poor condition of it plus the cost of it compared to what people earned – was one of the major factors in perpetuating poverty conditions for many of our nation’s children.
So, I am appalled to learn that, according to Trade Me Rental Price index, Porirua is now the most expensive district in New Zealand in which to rent, after rents climbed to a record $625 a week in September.
Families on low incomes pay their rent first , then power and the cost of transport to get to work. What they cut back on is food on which they pay the GST exploit- the- poor tax.
When families are forced to move because the rent goes up kids often have to change schools. This disrupts their education and their social support networks so the cycle of poverty and its consequences of rolls one and on.
The government’s housing policy is a mess.
Refusal to tackle the fact that one of the best ways to make money in our country is to buy and sell property especially when you lower bank interest rates and refuse to tax asset wealth is shameful.
This isn’t something you can blame on 9 years of National government
Labour is proving just as myopic in refusing to see past the ownership model to other housing solutions
( such as long term leasing ) or introduce asset taxes such as capital gains, death and stamp duties in order to reduce speculation and curb house prices.
The best way to stimulate our covid 19 plagued economy is for the government to invest in infrastructure that creates jobs because when people have jobs they spend which creates work and jobs for other people.Building houses employs a huge number of people from architects to chippies not to mention all of those engaged in the building supplies areas of our economy.
We need to fix the housing problem from the bottom up not from the top down.
A massive, massive, massive state housing / social housing programme needs to be a priority for this newly elected government which has been given the mandate to initiate progressive change in our country.
Failure to do so would be to fail hundreds of thousands of our nation’s children and perpetuate the problem of poverty and deprivation for generations to come.
Bryan Bruce is one of NZs most respected documentary makers and public intellectuals who has tirelessly exposed NZs neoliberal economic settings as the main cause for social issues.
Bryan
All you say makes total sense. But fear not my friend, after all Jacinda is in charge of poverty and, even better, there are hundreds and hundred and hundreds of projects that are…here it comes…drumroll…are you all excited…SSSSSSSHOVEL READY!!!!
(Shovel Ready is Labour’s biggest marketing spin/con ever and it means you need shovels to move the paperwork from govt dept to council dept so that every layer can find a way to NOT make it happen.)
Don’t hold your breath. We’ll reconvene in three years and we’ll both still be disappointed.
Absolutely. However, this government does not have the will or the courage to stamp out rampant speculation in residential property. NZers have always aspired to owning their own home and that is perfectly ok.
What is not ok is deliberate “investment” in residential property solely for capital gain. Reports this morning on the effect this is having attest to this. We need CGT on all but the family home, right now, but let’s not hold our breath.
Get real. CGT or wealth tax is not the magic silver bullet you all hope for. Even with those taxes the investors will invest. They’ll just pay the tax and take a bit less profit. Better than not making your money work at all.
What about this novel idea – make it really easy to build so many houses that the market is flooded with houses. End of profit making.
You see the problem folks???…it’s the part where I suggest ‘make it really easy’. NZ has become a country where everything, and I mean everything, has become difficult.
Isn’t trying to use CGT a very indirect way of looking at the housing / rental problem. CGT has a host of fish hooks.
Straight regulation covering housing provision, valuation of housing tied to sales exceeding that valuation being taxable profit with encumbrance of registering as a business plus restrictions on house ownership as investment.
“This isn’t something you can blame on 9 years of National government ”
Did NACT not foster record immigration over those 9 years to create the housing crisis they refused to recognise.
Porirua East was largely a state house development. Some sales were allowed to tenants but NACT sold houses to developers.
State rental stock should not be sold unless it is replaced by new rental stock. Rents need to be tied to a reasonable income related rate.
GST off basic foods would certainly help and with widespread computerisation of pricing and record of sales, the excuse that it would be difficult is just rubbish.
Australia manages their GST free food.
Very well said, John W.
“ We need CGT on all but the family home.” Spot on, RosieLee. And instead of pussyfooting around about no gst on fruit and veges, gst should be removed pronto from all food, and concomitant grocery shop stock. This has now become urgent.
Porirua rental costs are surreal, and appear morally indefensible.
Yes RosieLee. Housing is in crisis, yet people can still buy houses solely for speculation purposes. I’m not buying that “It’s all Phil Twyford’s fault”, which seems to be being suggested. As you say, it is a lack of government Will to take the necessary steps.
One law change to end further speculation would fix the problem. They have the numbers to pass such a law. It is time for them to act on this. They also need to put some sort of cap on rents.
This so-calledLabour government doesn’t have the balls to do it. Too much touchy feely meaningless “kindness”.
The only step govt has to take is to make it easy to build houses. If that means stepping all over the fucking local councils, like the abrasive and inflexible big city councils, then that is the step govt must take.
Millions will be cheering on the day that happens, because these councils have become financial tyrants with no shame and no accountability.
Yes, true about the councils.
If we were living in feudal times the councils would be our regional Lords and Barons, and at times they behave like that. I agree strongly that they should be being held accountable, above and beyond local elections.
(Other than building consent problems, and the ridiculous pettiness of having to get paid permission to fix a chook house, in effect, in a rural area, …my regional council’s use of highly toxic sprays along the roadsides and verges, and the localised high numbers of cancer cases there, is another serious example of councils’ lack of accountability to anyone.)
Housing is an investment target for people who want a secure investment in times of uncertainty. When you can’t evict a tenant , if maintaining a nest egg is the prime objective it is better to leave it empty than risk a bad tenant. To make it worthwhile a high rent is needed ,but many houses are being left empty anyway. Have a look at what gold prices have been doing during the last year and it is surprising that house prices are not higher. And gold is not ever likely to attract a CGT.
It is certainly essential that government provides the housing required at a rental that can be paid. Whether they build them with the 40 odd Billion they intend to spend on infrastructure or buy empty houses and rent them or both. The free market is certainly not going to supply them under the present globalised financial dynamics.
D J S
Completely agree. State housing built for purpose would go along way to “fixing” the housing problem. Such progressive policy, commensurate investment (funding) and subsequent action would indeed be a win win solution: improvements in child poverty, health, educational achievement, domestic violence, to name a few, and a long–term project resulting in sustainable employment for a good many at all levels. But as Herman Shovel Ready says, shovels are needed (in a metaphorical sense) to move the paperwork from govt dept to council dept and here lies the Achilles heal.
If ever complexity theory is useful it is with understanding the acute lack of affordable housing, at all levels. Surely this is a job for the new Minister of Housing, not that I expect Megan Wood or Marama Davidson to do the analysis. Their skills sets may not extend to this kind of problem solving but they do have a crucial coordinating role, one that involves liaison with other Ministries/ Ministers (and by implication the Reserve Bank). Complex problems rarely have simple solutions and are never solved in a silo. But HSR has another point: even when all the dots are joined up, governments can find a way to NOT make it happen.
We live in eternal hope.
There has been a housing crisis since I first arrived in NZ in 1974. Usually its a price-too-high crisis, but for one short period it was a falling-prices crisis.
With the world ‘falling to pieces’ and NZ perceived as a safe place to be, the current crisis is bound to get a lot worse -until the international financial system implodes and top-down management (mismanagement) of crises is no longer possible.
Until then, it NZ Titanic, sinking somewhat more slowly than most other national Titanics, with the third class passengers sacrificed so that the first class passengers get preferential treatment and privilege.
It’s pretty much the same everywhere in the world….except in indigenous societies not caught in the money-lenders web of deceit and extortion.
Who knocked down all the state houses in Porirua the Cannons Creek area? wasn’t it the National party. In fact National knocked down so many ghetto like state housing areas throughout NZ that them and the past Labour governments had created with their discriminative housing allocation staff and implementation of their racist housing policies. I know this first hand I was put in these areas, now I can’t afford to buy a home there.
[However, this government does not have the will or the courage to stamp out rampant speculation in residential property.]
Which comes first, the chicken or the egg? Does speculation cause prices to rise, or is it the other way round? As far as I can see the government needs to engineer a serious fall in house prices. It can do do this by either building lots more houses, or increasing interest rates. (Or both) There seem to to be obvious physical limitations on the former course of action, and the latter course also seems problematic.
Capital gains taxes are unlikely to have much effect.
Still no mention of what is driving demand for property in NZ. Aka immigration, which also effects labour and job supply.
Many jobs are now pay to work in NZ, as migrants can tick box a criteria to get residency by a fake job where they pay their wages back. You can bring dependants in, on the back of a student visa, supermarket job, slave fisheries…. They all need places to live, cars to drive, hospitals and schools to attend. Lazy immigration practises in NZ have led the charge of scams, and how can the local working poor compete with that????
Haven’t seen the left trying to deport exploiters who make profits from the above which seems to be booming.
If it costs $600k to build an affordable house now with Kiwibuild, even if the land is free from the state, something is wrong!
You get what you vote for – nothing. I don’t want to hear it.
Question: Did you vote Labor?
Their Answer: Yes!
My Reply: U voted for a party with no housing policy and a failed track record – you’re the problem!
Good point Zack. This housing mess has been presided over by National and Labour over many years and many changes of governments, and yet the people keep voting for them expecting something to materially change?
Like you I voted for TOP this time. Here is an animated time piece to show how disgracefully these successive NZ governments have allowed this problem to snowball since 1980, and this only goes up to 2016!
It would be great if it was updated as we know full well with the help of an out of control Reserve Bank (whose mandate exacerbates asset price inflation, and is set by the govt), and a govt unwilling to tackle property tax issues, that prices, especially in the regions have continued to skyrocket in the last 4 years.
Watch as Western countries compete for the unenviable position of having had the largest increase in real house prices since 1980.
https://twitter.com/matpottinger/status/1273924237007286272?s=20
I nearly voted TOP too. But alas, they proposed building houses on Wellington’s green belt, and I thought they were walking backwards. Houses on Boston Common or Hampstead Heath ? No way.
We fought hard to stop commercial development on the lungs of the city. Last time, a local paper, City Voice, had Simon Collins not just reporting assiduously on what was happening, but actually acquainted with the facts. City Voice has gone, and Simon has gone, and one day the Town Belt may be gone- and by that time we may all be.
…But from the start, TOP has had really impressive candidates – ignoring the rude chappie who started them off.
Geoff has resigned: TOP Party Leader Resigns
How about this?
On 4th January 2021 no one goes to work or pays their mortgages or housing rents. No one. No one pays tax nor electricity, or the internet, or for water, public transport, schooling, dental, health… no one pays anything.
What kind of message would that send? And to whom?
To the banks, that’s who.
The foreign owned banks are our masters. Not our politicians, nor us. Four foreign banks call the shots and they were let loose on us by crooked politicians and most of them were national.It was natzo’s disciples of greed who were the neoliberal element Trojan horsed into Labour. We shouldn’t forget that.
It’s now up to this new labour, a Labour Party of kindness and transparency to come clean about that. If they don’t? We stay home and our money stays with us.
And if they come for us? We go after them and the best way to get banksters down on their knees is to deprive them of our money.
And a word of warning…
One day we will have to smack the bankster down. There’s no other way of avoiding the vector of the current narrative. When that day comes, we must not stop smacking until they’re well and truly fucked. Gone. Done. Out of our beautiful AO/NZ. Forever.
I liken banksters to school yard bullies. They’ll keep at you until you knock them on their arses.
As I write this I’m reminded of George Orwell’s ‘1984’.
I see us as slaves to a terrible, soulless, greedy, terminally ravenous machine which comes in through the letter box and steals away with our lives and now? When we must retire spent and crippled we’re expected to hurry off and expire as quickly as possible. And ‘they’ can now help with that. Legally.
Keep up the righteous work @ BB.
Foreign owned banks don’t charge $100K for ‘reserve contributions’ to subdivide a simple property so a house can be built. Councils do. Officials do.
So the real problem is the ‘appointed’ and all-too-powerful bureaucracy that has become this country. It’s not what made this country great, but it’s what will fuck it up…the clipboard warriors in Wellington.
Your wrong Zack no one has failed us more than the National party when it comes to housing particularly state housing as they have sold the most, they knocked down the most and they gentrified the most therefore reducing this housing stock for the poor and working class peoples. Past Labour parties note I say past as I am hoping for change in this area. Labours failures have been in kiwibuild so far (but this could change) and allowing the state employees to continue with racist and discriminative allocation of state housing. Labour have always been the party that builds more state houses and National the party that sells the most state houses. Its easy to find these facts.
Yes we know that Zack cause we got our brighter future last time only it wasn’t so bright it was more blight.
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