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Remember Phil Twyford promising to build 100,000 houses in 10 years? It seems like a long time ago now. Instead of fixing the housing crisis as they promised, this Labour Government has made the situation worse for thousands of Kiwis. Housing is rapidly becoming a luxury in this country: a situation we would never have imagined even a decade ago.
When refugees from war-torn Africa are saying that they were better off in refugee camps, you know something has gone horribly wrong.
Yes, this is New Zealand in 2022, where a refugee family of eight is living in a two-bedroom motel. I wonder where all those Manus Island refugees are going to live? Jacinda likes to look good on the world stage by bringing in as many refugees as possible but, like everything else this government touches, those in need end up worse off. No one ever seems to think these things through.
South New Brighton man Steve Roberts said he was shocked to receive notice last week of a rent rise from $410 to $490 a week.
Roberts, who has been on ACC since last year with a foot injury, said he does not know where he will find the extra $80.
He has been in the house, which he shares with his labrador dog Frank, for four years. His previous rent rises have been $5 or $10.
“It was just a massive shock,” he said. “It’s a reasonably solid house.
“To just put the rent up $80 for no real reason… it’s pretty tough.”
Stuff
I don’t know why he is so surprised. The government has completely wrecked the private rental market by imposing draconian rules on landlords, driving many out of the rental market all together. As a result, the number of private rentals is dwindling nationwide; landlords are selling up and, although they mostly sell to first-time buyers, there will always be people who need to rent. The example of a house in Blenheim a few weeks back that had over 80 applicants to rent it demonstrates how dire the situation has become for many people.
Now the Greens are campaigning for rent freezes, so we will see more landlords exit the market. Just watch.
And it is not as if there are plenty of social houses available. If there were, there would not be so many people living in motels, would there?
But having not been able to fix the issue of homelessness, or ensure the supply of rental houses, the Labour Government has also managed to wreck the private housing market too. You may have observed that house prices are coming down. You may think that is a good thing, and the government will no doubt take credit for it… but this is just another bit of bungling by this hapless government.
House prices have been spiralling out of control for some years now, driven by supply issues, council red tape and cheap money. Then along came Covid and this socialist government took the opportunity to start printing money. Lots of it. Billions of it in fact. If you remember that we got through the GFC without printing money, the wisdom of this strategy is questionable at best and, frankly, the Reserve Bank governor should not have acquiesced so readily. But he did. The result is billions of dollars in debt, wasteful spending everywhere and an economy on the brink of ruin. But, as night follows day, quantitative easing always results in one thing. Inflation. That cheap money results in a free-for-all in asset spending, which we have seen. But the problem is that, as inflation hits, the Reserve Bank really only has one tool to deal with it: increase interest rates. Now, as the OCR is tracking upwards, money is not so cheap any more. Buyers have to consider whether they can afford a loan of $1 million or more to buy an average house. That in itself is enough to start to cool the market, but it was never a deliberate policy.
That is bad enough, but interest rates had to increase eventually. Then came the government’s latest piece of legislative carnage. In an effort to control loan sharks, a piece of legislation was passed that inadvertently went to the heart of the banking industry. The amendments to the Credit Contracts and Consumer Finance Act late last year have devastated the mortgage market. While the object of the legislation was to raise the standard of lenders in the market and therefore protect consumers, it has resulted in banks scrutinising borrowers’ spending to comply with the requirement of ‘responsible lending’. People are now being turned down for loans because they spend too much on takeaways – a habit that we all know will likely change once they have a mortgage to pay.
You may well ask how a piece of legislation designed to rein in loan sharks has resulted in buyers being turned down for mortgages from high-street banks. I cannot figure it out either. The only answer is that this Labour Government wrecks everything it touches. There has not been a single piece of legislation that it has got right, but, in this case, the consequences for potential borrowers have been cruel indeed.
If you cannot get a mortgage, chances are, you can’t buy a house. While the legislation has been amended, the changes will not come into effect until June. In the meantime, inflation is now rampant, and you know what happens then? People hold off on big purchasing decisions, waiting to see how things unfold.
So you cannot get a state house, you cannot get a private rental and you cannot buy a house. That is the reality for those looking for somewhere to live these days.
Is this the most incompetent government in our country’s history? To me, the only thing they have achieved is to make Robert Muldoon look like an economic genius. But let’s not forget the years of pain that this country went through after his tenure. This time will be even worse.
