Housing - Issues, Effects, Observations and Solutions?

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#2613178 30-Nov-2020 11:52

A property investor's take on the situation.

https://www.stuff.co.nz/business/property/123538204/why-im-proud-to-be-a-property-investor

tdgeek

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#2613210 30-Nov-2020 12:32

quickymart:

A property investor's take on the situation.

https://www.stuff.co.nz/business/property/123538204/why-im-proud-to-be-a-property-investor

Yes, not everyone can afford to buy or wants to or is ready to, so rentals are needed. But the common thread is that rentals are owned by baby boomers, so thats bad as baby boomers are evil. But the reality is that landlords do provide a service, but I fail to see how they can be part of the solution. Ive had rentals, been a landlord. You can buy an ok house, bring it up to scratch, and rent it out and get a reasonable yield. To build a house to rent, that's not worth it. So unless landlords want to build build build, they wont offer a solution, they will continue offering a service that will always be needed no matter what the housing market is like

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#2613521 30-Nov-2020 18:03

Does this guy have the right idea maybe?

https://thespinoff.co.nz/society/30-11-2020/one-simple-idea-to-fix-new-zealands-dysfunctional-housing-market/

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#2613545 30-Nov-2020 18:51

quickymart: I was in Albany at the weekend, and while walking from the busway station to the mall saw massive swathes of open land, just sitting there doing nothing. Mostly setup for development with roading and bus stops etc in place. But where were all the houses? Or apartments? That whole area should have been teeming with housing. Granted, there are a few apartment complexes there - but not many, when there could be so much more.

This area was developed 20 years ago. Massey University is nearby dating from the same period. New housing was developed in the surrounding hills at the same time. The main mall and bus station was a few years later. The remaining unoccupied areas you saw in the town centre part are landbanked for more retail imo.

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#2613666 1-Dec-2020 07:12

quickymart:

Does this guy have the right idea maybe?

https://thespinoff.co.nz/society/30-11-2020/one-simple-idea-to-fix-new-zealands-dysfunctional-housing-market/

Eh, a couple of issues I can see:

1) A house that sits unrented for a year will just end up on Air B&B to get someone in there quick-smart. I get where they're coming from but arbitrary rules like that are a big sign to some people saying "please game this system". Secondly, who is going to monitor this and how resource-intensive is that going to be? Are those resources we're better off directing into supply?

2) Interest deductions - I like our tax system because it doesn't do all sorts of stupid things like personal deductions for most people. I don't think the case is there to corrupt that balance. Also, rental losses are now ringfenced, so you can't get a cashflow benefit from negative gearing to offset some of the cost from your personal tax anymore, so I'm not sure how effective it would be in the first place.

I think, however, you can use rental losses to offset any tax payable under the Brightline. That seems like a good place to start, as it would mean you'd have rental income losses that can only offset rental profits, and capital gains that can only be offset against other capital losses. It would largely have the same effect.

3) There's no talk of a soft landing. We now have a lot of FHBs who have recently bought in, whether due to age or family situations and not being able to wait around forever for intervention or a price drop that may never actually happen. Any change needs to include a soft landing for recent buyers, or else we risk making houses cheaper but plunging a huge chunk of the population into negative equity.

Also, we won't be able to just build our way out of this without other levers, but we do need to talk about coming up with decent, large family sized terraced homes in more central locations. Whether there's a way the government can open-source some of that process (standardised, pre-consented designs that can be built in NPS-friendly areas without notification) or all of it (directly owning and setting up pre-fab factories), they now have more options using their Urban Development arm, and they should be encouraged to use them.

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#2615938 4-Dec-2020 00:26

https://thespinoff.co.nz/politics/03-12-2020/i-finally-solved-the-housing-crisis-ask-me-how/

Basically, this bloke says the supply is the issue (a charge which is very true), then proposes some ideas to fix it.

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#2615949 4-Dec-2020 07:00

quickymart:

https://thespinoff.co.nz/politics/03-12-2020/i-finally-solved-the-housing-crisis-ask-me-how/

Basically, this bloke says the supply is the issue (a charge which is very true), then proposes some ideas to fix it.

Yep, off course it is. But you cant just build houses. We already do that. Im not aware of any builders who have high backlogs, they are building when people want to build. You need to persuade buyers to build. When he says "first home buyers could be offered extra financial assistance" that all wrong. It needs to be "first home builders could be offered extra financial assistance" First home buyers can be forgotten about, all that does is increase demand. The issue we have is existing houses get bought and sold and bought and sold like Monopoly. That adds nothing to the crisis. While we cannot build the apparent 100,000 shortage next week, we can easily cut demand by making buying less palatable, and make building more palatable. You then increase stocks and decrease buying demand for existing houses.

Stamp Duty for existing that is given to builds. Increase interest rates for buyers and deduct that from builders. The Govt can surely buy out land blocks where needed, get the private sector in to do the infrastructure, get the sections titled for sale, all done in bulk, and divvy the dollars by the sections, they can get that money back. With building demand increased, they will sell and be built. Buying demand decreases, over time rental demand decreases. You might entertain if I sell my existing home I can avoid the stamp duty if I have signed a build contract. I benefit, the buyer of my house benefits as they avoid the stamp duty effect, and again, a rental demand has just removed themselves from the rental market.

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#2615976 4-Dec-2020 08:09

I hear what you're saying but I remember something about some Kiwibuild houses that just didn't sell, and they were then sold on the open market. Why did that happen? (Sorry I didn't fully follow Kiwibuild when it started).

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#2615981 4-Dec-2020 08:21

quickymart:

I hear what you're saying but I remember something about some Kiwibuild houses that just didn't sell, and they were then sold on the open market. Why did that happen? (Sorry I didn't fully follow Kiwibuild when it started).

The way I see it, is if you want to buy you look for a house that you like in an area that you like. To build, you do the same.The odds of looking at scattered Kiwibuild houses that suited the size, design and location is probably quite low.

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#2616894 6-Dec-2020 11:51

I'm worried about urban sprawl and why the promise of 100K houses wasn't seen as a terrible idea even if it was possible. At least as far as being the priority.

IMO the focus on city intensification is still far too low, not just quantity but quality, eg. creating them in concert with more advanced livable green spaces. To make those projects financially viable government investment / developer incentives should mainly be focused here - not to create endless slums that will ultimately put thousands more cars on the road and contribute to climate change.

Also the industry itself is still a complete mess. We are still building leaky homes - it cost the country tens of billions but people don't seem to care. They're just like, gimmi my white picket fence already. I don't know what the solution is but I doubt governments will change bad habits until the media gets in their face.

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#2616991 6-Dec-2020 14:10

arcon:

I'm worried about urban sprawl and why the promise of 100K houses wasn't seen as a terrible idea even if it was possible. At least as far as being the priority.

IMO the focus on city intensification is still far too low, not just quantity but quality, eg. creating them in concert with more advanced livable green spaces. To make those projects financially viable government investment / developer incentives should mainly be focused here - not to create endless slums that will ultimately put thousands more cars on the road and contribute to climate change.

Also the industry itself is still a complete mess. We are still building leaky homes - it cost the country tens of billions but people don't seem to care. They're just like, gimmi my white picket fence already. I don't know what the solution is but I doubt governments will change bad habits until the media gets in their face.

I thought the leaky home issue was solved? Re urban sprawl I don't see why not, towns and cities get bigger. Apartments are fine too, but not everyone wants to love in one.

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#2617089 6-Dec-2020 18:24

Ah, but what about living in one? 😄

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#2617093 6-Dec-2020 18:40

quickymart:

Ah, but what about living in one? 😄

As I said, I thought this was done with? If you are renting and its leaky I would move or tell the landlord to fix it, or complain to Tenancy Tribunal. The Govt could implement a healthy home act but that would be bad to regulate to achieve dry, warm and healthy homes..... :-)

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#2617125 6-Dec-2020 20:25

tdgeek:

I thought the leaky home issue was solved? Re urban sprawl I don't see why not, towns and cities get bigger. Apartments are fine too, but not everyone wants to love in one.

😄

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#2617178 7-Dec-2020 06:47

tdgeek:

I thought the leaky home issue was solved? Re urban sprawl I don't see why not, towns and cities get bigger. Apartments are fine too, but not everyone wants to love in one.

Depending on who you talk to. Supposedly-remediated buildings being re-remediated and some of the new blocks being a bit sus does come up from time to time. I guess that's one of the successes of Hobsonville Pt; you're buying from known builders.

I think you'd be brave taking on an apartment in NZ. All the homework in the world won't help you if your bodycorp can operate within a stupidly outdated framework, and Labour dumped Nikki Kaye's body corp reform bill.

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