House price hopes under scrutiny
Rob Stock runs the ruler over the major parties’ house-price policies.
WHENchallenged during the leaders’ debate on whether he wanted house prices to fall, Prime Minister Bill English said: ‘‘I want them to stay flat while incomes rise.’’
His rival for power, Jacinda Ardern, said: ‘‘For homeowners, the ones who currently have their homes. We don’t want them to lose their value, but we want more affordable housing in the market as well, and that is what is missing.’’
Experts doubt that either party’s policies will achieve their leader’s hopes. English’s answer may provide comfort for homeowners enriched as a result of a failure to build enough homes to meet demand, but it offers none to a generation of people left renting thanks to astronomically high house prices.
Affordable-housing campaigner Hugh Pavletich said: ‘‘There has already been a generation that’s been severely mistreated because of this housing issue, and what Mr English is saying is another generation should miss out. That is grossly irresponsible.’’
Pavletich said prices must fall, gradually, until they are around three times median income.
English’s vision of prices staying level, but falling in real terms as wages rise, wouldn’t achieve that.
Auckland needed only look to Christchurch for its housing solution, Pavletich said. Spread out. Free up land supply. Let people build.
Pavletich does not believe National has the policies to keep prices flat as incomes rise.
When National came to office under John Key, the median house in Auckland cost 6.4 times median household income, he said. ‘‘It’s now a ‘‘stratospheric’’ 10 times.’’
Housing strategist Leonie Freeman, who has just released a report on restoring housing affordability, can’t see National’s policies achieving English’s hopes.
The Government’s philosophy was to sort out land supply and infrastructure and leave the rest to the market. ‘‘The market hasn’t done that,’’ she said.
Pamela Bell from PrefabNZ said: ‘‘It’s highly unlikely that our incomes will rise to meet house prices. It’s a lovely idea, but I can’t see how it could work.’’
Under pressure in the polls, National has announced an overhaul of urban planning to make it easier, and faster, to build homes. National says it is making ‘‘good progress’’ in getting houses