With the recent Budget announcement, the Property Institute has attracted a lot of media coverage on the implications for the property industry.
Thursday, 25 May 2017
Property Institute underwhelmed by budget
Property Institute of New Zealand Chief Executive, Ashley Church, says he is disappointed and surprised that the Government has not used the Budget to alleviate the Auckland Housing shortage and says that it risks giving the impression that the Government ‘either doesn’t understand the extent of the problem, or simply doesn’t care’.
The Institute has been calling for Government to act, urgently, on housing affordability for first home buyers and on the speed at which new homes are being built or purchased by private sector buyers. However, Mr Church says that neither of these have been addressed in the Budget announcement.
“Auckland needs 40,000 new homes, right now – and the best way to achieve this at least cost to the taxpayer is to encourage private buyers to start building rather than buying existing homes – so we had hoped that the budget would contain a suite of measures to incentivise people to do this. But there’s nothing even remotely targeted to this purpose, and the problem is no closer to being resolved today than it was yesterday”.
“We were also hoping to see further measures designed to alleviate the pressure on first home buyers. Perhaps a new Government Equity Program designed to assist with the deposit or suspensory loans in the early stages of a mortgage which could be repaid further down the track. But there’s absolutely nothing in the budget to achieve this either”.
“Clearly, the Government is supremely confident that they already have the housing crisis nailed and that no further initiatives are necessary. Unfortunately, I don’t share that confidence and they’re taking an awfully big gamble with the lives of a lot of people in the hope that they’re right”.
Mr Church acknowledged last weeks announcement that the Government will be building 34,000 new houses in Auckland over the next 10 years but repeated his comments, at the time, that the initiative was a great step but only a small part of the necessary solution.
“The building program will add around 2,700 more homes to the market each year for the next 10 years. That’s great – but it’s nowhere near enough to solve the problem. I’d have expected to see new initiatives showing that the Government also understood that it needed to engage the support of the private sector in solving this. Sadly – there are no such initiatives and the attitude seems to be one of ‘that’s us – we’re done’”.
Mr Church also acknowledged the extra cash being handed out to households but believed this didn’t offset the lack of more robust housing policies.
“An extra $26 bucks a week will mean a lot to some – but it’s cold comfort for someone trying to get into a home. We needed to see more”.
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