Housing Announcement and Reforms 23/03/2021

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#2684171 30-Mar-2021 16:04

SaltyNZ:

We'd be better off intensifying, in my opinion. Otherwise we're going to build houses on top of our farms and have nothing to eat. It's already started out Pukekohe way.

Which is why we need to get a lot of business out of Auckland and into the regional cities.

We already have the problem that Auckland is so big, elections can be won/lost based on the Auckland vote. This leads to government policy being Auckland centric to the detriment of the rest of NZ.

sir1963

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#2684173 30-Mar-2021 16:11

Handle9:
Paul1977:

There seems to be a widespread view, which is apparent by some posters in this thread, that pointing out the potential problems with the Governments proposal is the same as saying "screw FHBs, and leave investors alone". It really isn't.

I'm not a renter, a FHB, or an investor - and the first thing that crossed my mind when I read about the changes was "landlords will just increase rents".

The problem is supply and demand. Labour (and previous governments) have either been unable or unwilling to sort the supply, so now they're trying to reduce demand instead. In my (admittedly limited) view, the approach they've taken won't work and will result in a lot of losers and very few winners.

Disagreeing with a proposed solution isn't the same thing as saying there isn't a problem.

They are doing both. The NPS UD was the first step and RMA reform is the next step

Neither are fast fixes and there is an urgent need to slow down the feeding frenzy, particularly by investors.

The limit them to 60% of the valuation from 3 years ago. But don't lie.

We DO have capital gains now via the bright line test. Now we have it, watch it spread.

Tax deductibility was NEVER a "tax loop hole", if it was they would apply it to every business.

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#2684174 30-Mar-2021 16:11

sir1963:
GV27:

So we're in agreement then: investors spiking property prices has left recent FHBs vulnerable and priced aspiring FHBs out of the market.

Note quite.

The low interest rates have pushed investors out of cash deposits because they earn basically nothing. These investors are NOT going to buy into the sharemarket.

When interest rates rise again, they will move out of housing again. These were only temporary investors anyway.

The long term investors are not going to build, Robertson has killed that off because of the risk he will screw them over too.

This policy has done ZERO to increase housing stocks (the only solution) and may have reduced investment in new stocks. We are already no building enough.

I really do wonder if this policy was rushed out the door to smother the news about the lack of building supplies and how small building companies may go broke. ie New Builds falling.

If housing investors are too stupid to consider other forms of investment then bad luck. Anyone who locks all their investments into one asset class is setting themselves up for a world of pain.

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#2684176 30-Mar-2021 16:14

sir1963:
Handle9: [

They are doing both. The NPS UD was the first step and RMA reform is the next step

Neither are fast fixes and there is an urgent need to slow down the feeding frenzy, particularly by investors.

The limit them to 60% of the valuation from 3 years ago. But don't lie.

We DO have capital gains now via the bright line test. Now we have it, watch it spread.

Tax deductibility was NEVER a "tax loop hole", if it was they would apply it to every business.

John Key said it wasn't a capital gains tax when he introduced it so it clearly isn't one.

sen8or

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#2684177 30-Mar-2021 16:20

Housing investors too Stupid? Are you serious?

Have a look at the failure rate of businesses in New Zealand, who exactly do you want to invest with? When less than about 1/3 of businesses last the 10 year mark, you are playing russian roulette with your life savings. The failure of the finance firms over the last decade or so put pay to "high rate high risk" investments and the sharemarket gets the wobbles based on whatever political event is happening that day.

Air NZ shares tanked on the back of Covid, hardly their doing, but if you owned a whole heap of them 2 years ago, you'd be a bit down about your investment now. Then theres Sky, I think they are down to giving those shares out with a happy meal at McDs now aren't they?

A diversified portfolio is an ideal position, but it is also seen as "for the rich" and beyond the understanding of many mum and dad investors.

sir1963

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#2684178 30-Mar-2021 16:21

Handle9

If housing investors are too stupid to consider other forms of investment then bad luck. Anyone who locks all their investments into one asset class is setting themselves up for a world of pain.

Which is why I am looking at Australia, Plan-B.

Anyone who trusts this government is a fool. What's next, compulsory double glazing , Landlord has to supply Fridge, Washing machine, Drier ? New "loop holes" discovered for Rates, Insurance, Maintenance ?

The internet is a necessity these days, will landlords be expected to supply that for free ?

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#2684179 30-Mar-2021 16:26

sir1963:

The internet is a necessity these days, will landlords be expected to supply that for free ?

"From 11 February 2021, tenants can request to install fibre broadband and landlords must agree (if it is possible and can be installed at no cost to them), unless specific exemptions apply."

You're also going to find Australia has some pretty interesting tax quirks compared to our system.

sir1963

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#2684180 30-Mar-2021 16:26

Handle9

John Key said it wasn't a capital gains tax when he introduced it so it clearly isn't one.

The purposes was to stop property developers from renovating a property, rent it out for a few months, claim they were landlords and avoid the tax they should have paid.

It was a line in the sand that IRD, developers and accountants were all aware of.

Landlords were not there to buy and sell, they were long term investors so the 2 year line was hardly an issue.

10 years now is not a line in the same, it is a conversion for one class of asset to be taxed on capital gains. Its purpose is very different.

But I also never vote for Key, perhaps I should have.

sir1963

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#2684184 30-Mar-2021 16:29

GV27:

sir1963:

The internet is a necessity these days, will landlords be expected to supply that for free ?

"From 11 February 2021, tenants can request to install fibre broadband and landlords must agree (if it is possible and can be installed at no cost to them), unless specific exemptions apply."

You're also going to find Australia has some pretty interesting tax quirks compared to our system.

Sure, like depreciation at 2.5% or 4% based on what class of rental you are.

None of my friends who have shifted feels the need to come back to NZ because of tax reasons, they all claim they are better off.

Most are now even Australian Citizens

Handle9

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#2684185 30-Mar-2021 16:30

sen8or:

Housing investors too Stupid? Are you serious?

Have a look at the failure rate of businesses in New Zealand, who exactly do you want to invest with? When less than about 1/3 of businesses last the 10 year mark, you are playing russian roulette with your life savings. The failure of the finance firms over the last decade or so put pay to "high rate high risk" investments and the sharemarket gets the wobbles based on whatever political event is happening that day.

Air NZ shares tanked on the back of Covid, hardly their doing, but if you owned a whole heap of them 2 years ago, you'd be a bit down about your investment now. Then theres Sky, I think they are down to giving those shares out with a happy meal at McDs now aren't they?

A diversified portfolio is an ideal position, but it is also seen as "for the rich" and beyond the understanding of many mum and dad investors.

I’m quite serious. It’s incredibly easy to have a diversified portfolio. There are any number of ETFs that can be bought online cheaply and very easily.

sir1963

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#2684208 30-Mar-2021 17:35

So much for no risk

https://www.nzherald.co.nz/business/whacked-with-huge-costs-163m-estimated-to-fix-defective-auckland-apartments/IZPBJLVZDTFZU5ZQOEPIBP7BKY/

Interest on $16 Million will be expensive, and the lack of building materials is only going to make the problems worse

And then there are all the leaky apartment buildings in Auckland .

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#2684227 30-Mar-2021 18:02

Handle9:

I’m quite serious. It’s incredibly easy to have a diversified portfolio. There are any number of ETFs that can be bought online cheaply and very easily.

I can use an app to buy shares in almost any market on the planet. Cryptos, change my Kiwisaver mix, commercial property funds, you name it. Having a balanced portfolio has literally never been easier.

Also, if you were holding Air NZ when they plummeted, you could have bought more to cover your losses using dollar-cost-averaging.

Like real estate, the government was never going to let the state airline fail.

tdgeek

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#2684238 30-Mar-2021 18:31

SaltyNZ:

The builder was great (True Property Builders, if you're looking for one in the Auckland north region). Getting excited about tapware is just something I really need to be in the mood for.

Actually I would be keen on that!

tdgeek

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#2684241 30-Mar-2021 18:36

sir1963:

By them being the developer and building houses, units, etc.

State houses were done that way.

Thats an option. The building industry would be removed, which is harsh. yes, the "workers" would be assimilated. If the housing situation was to be that regulated so will rentals. Then you are looking at a socialist state. Well, it worked back then so why not? Replace builders with Govt builders and replace landlords with Govt landlords.

tdgeek

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#2684244 30-Mar-2021 18:37

sir1963:

SaltyNZ:

We'd be better off intensifying, in my opinion. Otherwise we're going to build houses on top of our farms and have nothing to eat. It's already started out Pukekohe way.

Which is why we need to get a lot of business out of Auckland and into the regional cities.

We already have the problem that Auckland is so big, elections can be won/lost based on the Auckland vote. This leads to government policy being Auckland centric to the detriment of the rest of NZ.

This is a residential housing discussion

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