Quote of the day

April 8, 2015

 . . . Dunedin, Invercargill, Timaru and Nelson are seen as very affordable places for first-home buyers, but the consistent drift north of jobs and government services, in particular, make it difficult for young people to find work.

To find work, many go to Auckland or Christchurch, and the problem continues.

Dunedin has a median house price of $281,500 and Invercargill’s price is $210,000. If more could be done to encourage people to live and work in the South – say through a regional development policy – some of Auckland’s housing problems will disappear. . .  – ODT editorial

Andrei commented a few days ago on the family and other ties which bind people to familiar places.

That is a valid point.

But it doesn’t apply to everyone and moving for most of those for whom it does would still be far easier than it was for the immigrants who came here in past centuries from far further than the distance between Auckland and Dunedin.

5 objectives for social housing

February 20, 2015

National has five objectives for social housing:

1. Ensure people who need housing support from the Government get it.

2. Help social housing tenants to independence, as appropriate.

3. Ensure that properties used for social housing are the right size and configuration, and in the right areas.

4. Help increase the supply of affordable housing for people to buy.

5. Encourage and develop more diverse ownership of social housing.

That’s simple and sensible – unless you don’t understand that housing policy which works for the people who need help is more important than who owns the houses.

Why aren’t houses like cars?

February 5, 2015

This could be part of the solution to housing affordability:

In the 1970s the GM factory in Trentham turned out old-school Vivas and Chevettes. Today it was re-opened by the Hon Bill English with a role better suited to the 21st century – building homes.

Matrix Homes was established last year by Wellington entrepreneur Sean Murrie and architect Graeme Farr to produce quality affordable homes for two thirds the cost of traditional building methods.

Matrix Homes’ managing director Sean Murrie said, “Matrix Homes came about from our belief that New Zealanders pay millions more than they should for housing due to inefficient practices and markets.

“Our mission is to put that right by redesigning the build process. We set out to drastically reduce the cost of a new home without sacrificing the quality you expect in what is most people’s largest investment. By re-engineering the whole build process from the ground up, Matrix have made a quantum leap forward in affordability and quality.”

Matrix Homes are not built on-site but under cover in the Trentham factory. This enables work to continue irrespective of the weather. The cost-savings are achieved through greater efficiencies: economy of scale in sourcing building materials, standardised modular construction and no down time.

“Traditional ‘affordable’ housing focuses on reducing the cost of materials and results in a home that forever looks cheap. Matrix is a proper wood-framed house with timber weatherboards, cedar cladding is an option, Gib lined and with a galvanized iron roof. So far we’ve designed dozens of Matrix configurations for the three standard modules.

A range of sustainable options are also available including a full off-grid package including solar hot water heating and a self-contained wastewater system,” Sean Murrie said.

“With Matrix you get factory quality control and eliminate ad hoc on-site improvisation. Our design incorporates standardised window sizes enabling phenomenal savings. Assembling floors and walls on pre-built jigs has virtually eliminated the tape measure – the biggest single source of time and material wastage. Materials are pre-cut and perfect with each component optimised and identical.

“More often than not, your new home will be completed by the time you have planning consent and completed your site preparation. We can deliver virtually anywhere in the country and the modular format enables you to expand your home at a later date if required.”

Prices range from $89,000 for a one bedroom home of 51 m2, $99,000 for a 70m2 2 bedroom home to $195,000 for a 4 bedroom, 2 bathroom home of 140 m2. Pricing includes floor coverings, painting, oven, cook top, range hood, laundry tub, corner shower, hand basins and vanity units, heated towel rail and extractor fan. Transport, piles and installation are in addition. While homebuyers are responsible for site preparation, Matrix can organise this on their behalf.

Homebuyers can personalise their home by selecting options including decks, garages and heat pumps and the like.

When the factory reaches full production, economies of scale will enable the costs to be further reduced to around half that of a same sized house build on-site.

The factory currently employs six people fulltime with that number expected to grow to 70 by the end of this year.

Sean Murrie said, “A Show Home has been completed and the concept has attracted considerable interest from home buyers and property developers and we are now completing the final design details for a large number of customers. By the end of 2015, we expect to be building one house per day and are aiming for 1,000 per year when the factory reaches full production. Realising this goal will help contribute to lowering the cost of new housing and develop a sustainable manufacturing business in the Hutt Valley.”  

How much did it cost to buy an average car and an average house 50 years ago and how much does it cost now?

I can’t give the exact figures but I cam confident that the increase in the cost of the average car is far less than the cost of the average house?

Several factors will be responsible for that, one of those is that we get mass produced cars but we don’t get mass produced houses.

These houses aren’t mass produced but the time and cost involved in building them is a lot less than conventional methods.

A better way of doing things

January 28, 2015

Prime Minister John Key delivered a speech on social housing today.

Highlights include:

“The experience of countries like Australia and the United Kingdom is that having non-government organisations providing social housing, alongside the government, is a better way of doing things.”

“The experience of countries like Australia and the United Kingdom is that having non-government organisations providing social housing, alongside the government, is a better way of doing things.” www.national.org.nz/socialhousing

Around a third of Housing NZ properties are in the wrong place, or are the wrong type to meet existing and future demand.

Around a third of Housing NZ properties are in the wrong place, or are the wrong type to meet existing and future demand.<br /> www.national.org.nz/socialhousing

“It’s part of the Government’s wider approach to delivering better public services to New Zealanders who need them”

“It’s part of the Government’s wider approach to delivering better public services to New Zealanders who need them.” www.national.org.nz/socialhousing

Community housing providers can, and should, play a more significant role in owning and running social housing.

Community housing providers can, and should, play a more significant role in owning and running social housing.<br /> www.national.org.nz/socialhousing
We’ll help more vulnerable New Zealanders get into social housing when they need it.
We’ll help more vulnerable New Zealanders get into social housing when they need it. https://www.national.org.nz/policies/social-housing

“We’re taking a different approach to provide quality social housing for New Zealanders who need it.”

“We’re taking a different approach to provide quality social housing for New Zealanders who need it.”

Number matters not owner

November 3, 2014

The opposition and the other usual suspects are exercised by the government’s plan to sell some state houses and labelling it an asset sale. But Prime Minister John Key said:

“If at the end of the day, Housing NZ sells a few state houses, well, actually, that’s happened for a long period of time. We often trade our stock.

“So if we sell some individual state houses, it’s not an asset sale. If we sold Housing New Zealand or part of it, it would be, and we have absolutely no plans to sell.”

This is like Landcorp selling some of its farms.

I’d be happy if the SOE sold more, but selling farms isn’t the same as selling the company, just as selling some houses isn’t the same as selling the entity that owns them.

Mr Key said the Government was undertaking a massive redevelopment of state housing stock because many houses were in the wrong place or unsuitable for housing needs.

If the houses are in the wrong place, in poor condition, have too many or two few rooms or are otherwise not fit for purpose it is sensible to sell them.

The issue shouldn’t be who owns which houses but what’s the best way to ensure people who need a house can get it and the government is planning to increase the supply by building more state houses and also making it easier for other providers of social housing to build.

The number of houses available matters far more than who owns them.




Tax on entrepreneurship, innovation and risk taking

September 4, 2014

Capital gains taxes haven’t worked to keep property prices down in other countries and it will push up prices here:

Labour’s capital gains tax, won’t do what David Cunliffe says it will, according to the Taxpayers’ Union, backed up by a former Deputy Commissioner of Inland Revenue, Robin Oliver.

Taxpayers’ Union Executive Director Jordan Williams says, “Labour are misleading taxpayers if they think a CGT will be a panacea for the housing market. Mr Cunliffe is wrong to say that current tax law does not tax property speculators.”

“Income tax already applies to speculators, builders and developers. Taxing the rest of the market can’t possibly bring down prices.”

Robin Oliver, says, “Under an Australian type Capital Gains Tax a person choosing between investing in a business or buying an even more expensive home will have an increased tax incentive to invest in the home. Gains on the home will be tax-free, gains on the business will be taxable and it will be difficult to use any capital losses the business makes. The playing field is clearly tilted towards home ownership rather than risking money in a business creating jobs.”

Williams says, “Ultimately, Labour’s capital gains tax is a tax on entrepreneurship, innovation and risk taking.”

Simple taxes are better taxes and they shouldn’t incentivise investment in non-productive assets like homes over productive ones like farms and other businesses.



Labour’s housing policy shambles

August 29, 2014

Labour chose the wrong couple as the poster children for its housing policy:

David Cunliffe is backing the party’s choice of a couple used as a case study for Labour’s housing policy, after the pair conceded they weren’t actually looking to buy.

The Labour party leader and the party’s housing spokesman Phil Twyford confirmed Labour’s KiwiBuild policy at a housing development in Hobsonville yesterday with a young couple who Mr Cunliffe said would benefit from the policy. . . .

Ms Leigh said they were currently living with her parents and although they had “had a look at houses in the Auckland area” she conceded they weren’t actively in the market to buy.

“We haven’t actively been looking for a home to buy in the near future – that’s definitely not our goal – our goal is to have a home in a few years. We’re trying to start a family.” . . .

Patrick Gower wasn’t impressed either:

Labour’s campaign is listless, meandering and shambolic.

The media with him say it’s a bit of a shamble and have been reporting on it.

Reporters are doing stories about Cunliffe having curry for lunch and there are even whispers from the press pack that Cunliffe is taking naps, but I asked him straight up yesterday and he said “no”, no nana-naps, only the odd bit of kip while in the car (which isn’t a crime). 

I took a look at Cunliffe’s campaign myself in Hobsonville yesterday.

Hobsonville quickly turned into campaign trail bizarro-world.

Cunliffe was out there to counter-attack on housing after Key trotted to the very same streets earlier in the week.

Cunliffe and housing spokesperson Phil Twyford re-announced the party’s Kiwbuild policy, saying Labour could build a $485,000 two-bedroom terraced house for $360,000 because of economies of scale.

But they didn’t have a house as an example, they were just standing on the street.

Twyford was saying there were heaps of examples of the $485,000 homes in Hobsonsville, but he didn’t know where they were and never got back to me with an address.

I can tell Twyford where one is – it’s just around the corner, a $450,000 two bedroom – I know because Key took us there on Monday.

Then they rolled out two first home buyers, Harrison and Jordy, who bagged National’s Homestart policy.

But under questioning they weren’t first home buyers at all, they weren’t even looking.

In fact they wouldn’t even buy a house under Labour’s policy.

Then it turned out that they were members of the EPMU, and they stopped answering questions when asked if they voted in Labour’s leadership campaign last election.

And despite the policy being around since David Shearer was leader, Labour still couldn’t come up with simple lines like when the first house will be built.

Then media weren’t allowed any more questions about the news of the day, Cunliffe had to “have a briefing” – for the uninitiated, this is unusual, as reporters usually just ask all the questions in one stand-up. 

Cunliffe then went off on a “walkabout” which is what politicians do when campaigning, you shake a few hands and the cameras follow.

But there was nobody on the street, Cunliffe eventually turned around and came back again.

Then Cunliffe jumped in the Crown limousine which went for a cruise around the block using up taxpayer petrol so he could have his briefing. . .

The media stands around on the side of the street waiting. . .

Labour looks disorganised.

I will give Labour this free advice: Cunliffe won’t get to be Prime Minister by wandering aimlessly around a Hobsonsville cul-de-sac.

The party’s in a cul-de-sac, driven there by internal dissent, poor organisation and shambolic policy.

Labour chose the wrong couple and they’ve got the wrong policy:

New Zealanders can have no confidence in Labour’s housing policy when they can’t explain how it would work, when its housing spokespeople say different things and the announcement is a shambles, National’s Housing Spokesman Dr Nick Smith says.

“KiwiBuild is a joke because Labour has no idea how it would build 10,000 homes a year, cannot explain how they would pay for it and they still have not worked out who would be eligible for the homes,” Dr Smith says.

“Launching the policy in Hobsonville only served to highlight Labour’s previous failings.

“Labour in government announced a 1600-home development on this land in 2002, but by 2008 had no planning approved, no resource consents, no infrastructure built nor a single house constructed.

“If they couldn’t build 1600 houses in six years, how can they promise 10,000 a year now under KiwiBuild?

“Hobsonville is progressing at pace under National’s Special Housing Area, with 444 built and sold and another 350 to be completed this financial year.

“KiwiBuild keeps changing. In November 2012, it was 100,000 three-bedroom standalone homes costing under $300,000 each. In 2013, it had become two-bedroom townhouses for $300,000 and up to $550,000 for standalone four-bedroom houses. Today they are saying two-bedroom terraced houses for $360,000.

“Housing Spokesperson Phil Twyford says the houses will be paid for when built. Associate Housing Spokesperson Poto Williams says they will rented with a later first right to buy.

“Three years from now, under Labour’s numbers they would be lucky to deliver even 7000 homes.

“National’s policies address land supply, council development charges on sections, building materials costs, and help for first home buyers with a deposit and loan. This is the way forward to help more New Zealanders realise the dream of owning their own home.”

If Labour’s policy is this confusing it’s no wonder they couldn’t find anyone who could represent those who will benefit from it.

Contrasting with that is National’s policy which will help people help themselves.

Photo: Over the next five years we’ll help 90,000 New Zealanders into their first home. ntnl.org.nz/1BQ94dK #Working4NZ


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