Last week’s housing announcement was a shocking indictment of Jacinda Ardern’s Labour Government. Without taking official advice and without assessing the economic and social costs of their actions, they have made fundamental changes to the residential property investment market and turned back the clock on a century of established tax principles.
Their actions are reckless and irrational – the hallmarks of a government in turmoil, desperately pulling at policy levers in the hope they will deliver desired political outcomes.
Instead of addressing the real cause of New Zealand’s housing affordability crisis, namely the restrictive land use regulations imposed by local authorities that are preventing the supply of sections for new homes keeping up with the demand – Labour is punishing rental property owners as if they are to blame.
How can New Zealanders have confidence in a Prime Minister and her administration when they continually lie to the public?
Parliament has been sitting for only six weeks but already there have been two instances where Jacinda Ardern has used her absolute majority to order the House into urgency to force through draconian law changes under false pretences, with no official advice, and no proper consultation.
In the first case in early February, the Prime Minister justified removing the right of citizens to petition their local councils for a referendum on Maori wards because, she claimed, it was a racist loophole. This was simply not true – she would have known veto rights were a democratic safeguard introduced by Helen Clark to protect electors against local body politicians manipulating the voting system.
Then just last week she was at it again, this time with a housing package that increased the capital gains tax that residential property investors have to pay – the bright-line test – from five years to ten, in spite of an unequivocal promise that she would not impose capital gains taxes while she was Prime Minister: “I am ruling out a capital gains tax under my leadership in the future.”
Newshubs’s Tova O’Brien described her actions as ‘disingenuous politicking at its worst’, saying, “Jacinda Ardern effectively introduced a capital gains tax, breaking one of the biggest promises of her political career – one that she staked her job on.”
The increase in the bright-line test also broke Labour’s election promise. When Deputy Prime Minister Grant Robertson was asked by Newstalk ZB’s Heather du Plessis-Allan just before the election whether the bright-line test would be changed, he categorically ruled it out. When Heather pressed: “Not the rate, and not the years?” – he said “No”.
But clearly, when you have absolute power, “No” can mean “Yes”.
Introducing a decade-long capital gains tax on residential property investors by stealth is punitive in the extreme. All around the world, capital gains are taxed at lower rates than income to reflect the fact that increases in capital value accumulate over a number of years.
The bright-line test however, treats capital gains as income to be taxed at the property owner’s marginal income tax rate in the year in which it is realised.
The Prime Minister also used the loophole lie to justify abolishing the right of rental property owners to deduct the interest they pay on their mortgages as a business expense.
She must surely must be aware that a foundation stone of tax policy – that applies to all forms of investment – is the principle that expenses incurred in the derivation of taxable income should be deducted before tax is applied.
In the same way as the Prime Minister’s 2018 ban on offshore oil and gas exploration, without any prior warning or official advice, was regarded as reckless policy making that damaged New Zealand’s international reputation as a safe place to invest, so too was her decision to axe tax deductibility for property investors.
This was evident in headlines the day of the announcement: “Government housing policy creates economic uncertainty, driving down NZ rates and NZD which is down 2.3% in last 24 hours”.
Tax expert Robin Oliver, a former deputy commissioner at the IRD, described the announcement as “out there”. A member of the Government’s Tax Working Group, he could not think of any example of a sector being unable to deduct an expense which was available to all other sectors of the economy. He called the policy “a massive tax penalty on renting out property. You’re taxed on income that you don’t actually have, because your profit is your income minus your expenses, but they just ignore the expenses part. You could have almost no profit, maybe a loss, but you still have to fork out thousands of dollars to the IRD. It’s not an income tax, it’s just a penalty.”
He claimed the sharp drop in the Kiwi dollar after the announcement was likely to reflect the concern international investors would have about the risk of putting money in New Zealand: “You invest in a country where ministers stand up and suddenly deny your businesses expenses you’ll say ‘I’d better go somewhere else’.”
The fact their new tax is seen as villainising property investors doesn’t appear to worry Labour.
But it is a concern to this week’s NZCPR Guest Commentator, property and business analyst Ashley Church, who is extremely critical of the Government’s treatment of property investors:
“Over the past 20 years, we’ve seen repeated attempts to fix the housing market by identifying and punishing different groups who are supposedly responsible for the woes of the market. In an attempt to curry populist support, successive Kiwi administrations have allowed themselves to be captured by movements which are more focused on punishing groups that they don’t like than actually fixing the housing market.
“Sadly – and despite failed repeated attempts to solve the housing crisis through this nonsense – we’re already seeing signs of the ‘new’ targets of this mob mentality, with property investors and speculators now seen as the cause of all of the problems besetting the housing market. Note the recent decision to introduce a capital gains tax on property investment (under the cover of the Bright Line Test) and to ignore a century of common tax law by disallowing deductions on interest for those operating a property business. These measures have nothing to do with ‘fixing’ the market – they’re about punishing those who are deemed to be the ‘cause’ of the collective woes of those who feel disenfranchised and are little more than a tarted up exercise in social scapegoating.”
Ashley is right – this Government is playing a high-risk game, especially as removing interest deductibility will drive up rents and, by making it even harder to save the deposit for a new home, Labour’s new policy will hurt the very people they purport to be trying to help.
In fact Labour’s changes are so far-reaching that commentators have yet to form a consensus about the impact they will have on house prices – and, more importantly, on home equity.
The Minister of Finance was warned about the economic risk of creating housing instability by the Reserve Bank Governor last December: “House price instability can threaten the resilience of banks at the system and individual level. Sharp declines in house prices during a recession can cause significant mortgage defaults and large losses for banks. This risk is particularly acute when many mortgage borrowers are highly indebted, relative to their incomes and home values. As interest rates have structurally fallen over the last decades, debt serviceability has become more affordable, while the amount of debt relative to income for new mortgagors has steadily increased.”
Since equity ownership in housing represents more than two thirds of New Zealand households’ total wealth – influencing perceived wealth and spending decisions – maintaining stability at a time when the New Zealand economy is already struggling from the effects of the pandemic, would seem to be an important policy priority for any responsible government.
That’s what makes Labour’s housing bombshell so dangerous – it is creating uncertainty at a precarious time.
Cameron Bagrie, the Managing Director of Bagrie Economics was shocked that the Government had introduced such far-reaching measures as abolishing tax deductibility without advice: “If the Government chooses to ignore that advice, fine. That is a political call, but I find it just unacceptable that there’s no advice… on a major initiative such as that. It sets a very dangerous precedent.”
The reality is that Labour’s housing policy was made on the hoof – as Treasury explains: “This Regulatory Impact Statement has been produced under extremely tight time constraints without consultation or the benefit of robust data… It represents the Treasury’s best assessment of the options identified by the Government in the time available.”
It turns out that while Labour’s solution to the housing crisis was to impose tax increases on property investors, Treasury had warned against it: “tax settings are not the primary driver of problems in the housing market”. They also warned the proposals could result in rent increases: “extending the bright-line test may put upward pressure on rents.”
When it came to the proposal to abolish interest deductibility for residential property investors, Treasury had advised against that too: “Given time constraints and lack of analysis, the Treasury does not recommend progressing the interest deductibility proposal without further analysis.”
The Inland Revenue Department had also opposed Labour’s proposals: “Inland Revenue recommended against both extending the bright-line and denying interest deductibility”.
So, there we have it. Our Government cobbled together a punitive housing policy to penalise rental property owners with such haste that while their official advisors were not able to produce a comprehensive analysis of the likely impact of the proposals in the time available, both Treasury and the IRD had nevertheless advised against extending the bright-line test to 10 years and removing interest deductibility for rental property investors.
Labour ignored their advice and introduced their punitive changes through a 50-page Supplementary Order Paper added into a tax bill – Taxation (Annual Rates for 2021-21, Feasibility Expenditure, and Remedial Matters) Bill – that had already gone through a Select Committee process and was waiting for a third reading. It passed through Parliament under urgency the day of the announcement.
In their advice, Treasury had suggested that if the Government really wanted to tackle the housing crisis, they should focus on removing the restrictions that are preventing the supply of housing from keeping up with demand. They believe New Zealand’s long-term housing shortfall could be between 40,000 to 130,000 houses, and they identify a range of restrictions that are exacerbating the problem including the increasing costs of building, and regulatory barriers such as zoning and planning laws.
Labour is well aware of these problems.
In 2016, their Housing Spokesman Phil Twyford called for urban growth boundaries to be removed: “Over 25 years the urban growth boundary hasn’t prevented sprawl, but it has driven land and housing costs through the roof… Labour’s plan will free up the restrictive land use rules that stop the city growing up and out. It will stop land prices skyrocketing… The urban growth boundary creates an artificial scarcity of land, and drives up section costs….”
In 2017 Labour’s election manifesto promised to “Remove the Auckland urban growth boundary and free up density controls”.
But once they became the Government, instead of introducing reforms to remove the restrictions, Labour tried to exempt themselves from them. Despite that, Kiwibuild became a spectacular failure. And, the deep seated problems that beset the housing sector, that must be resolved if New Zealand’s housing market is ever to function properly, still remain.
Unfortunately, Labour doesn’t appear to have the fortitude to make the changes that are necessary, and so it is attacking property investors instead.
Let’s be clear – last week’s changes are purely political. They were introduced by a Government desperate to be seen to be doing something about a runaway property market. In the long term, such policies will inevitably fail, because they are predicated on fundamentally flawed socialist thinking that political intervention can drive an economy.
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THIS WEEK’S POLL ASKS:
*Do you think the housing package Labour announced last week will solve New Zealand’s housing affordability crisis?
Note: Please feel free to use the poll comments to share your views on any of the issues raised in this week’s newsletter.
*Poll comments are posted below.
*All NZCPR poll results can be seen in the Archive.
THIS WEEK’S POLL COMMENTS
| The cause has not been addressed. Capital gains taxes are in place in Other countries as AU and do not appear to have solved house prices escalating. | Frances |
| Another bit of Labour tinkering without any idea of the ‘law of unexpected consequences.’ | Sylvia |
| Bloody ridiculous | Nick |
| No way. Ardern has swapped her title of PM to now behaving as a Dictator. She ignores her Government Department advisors in Treasury and the IRD and turns her own statements and promises prior to the election into lies, that she would not introduce new taxes, especially Capital Gains Tax. These changes forced through under urgency and with no discussion will cause untold damage to the economy, rental market and possibly the banks. It is unprecedented, dangerous and is going to leave many landlords in dire straits. The only good thing that may come from it is it may persuade thinking Labour supporters (are there any?) to realize how stupid they were to vote the Labour party back into power But even that is a faint hope. | Chris |
| The Socialist Autocratic March continues. Lies and damn lies | John |
| Not a show! | Tom |
| Ardern, aided by a leftist media, will destroy the wonderful country we once had. All to advance her political agenda. The concept of democracy – Government for the people by the people is well dead in New Zealand! | Rex |
| The so called housing package does not go far enough to stop New Zealanders from using housing as a means to save from capital gain instead of by more conventional means. What is going on with housing is akin to a goldrush and they never end well. | Gary |
| Labor hasn’t a clue of what its up to Any kind of capital gains TAX, is just that, a TAX on inflation that the govt created itself by its own incompetence! Then to penalize those legitimate investors for govts further failure exposes Labor incompetence proves that that group of idiots should never run a country. | Ced |
| As a property investor I was lost for words when this announcement was made except for these five words “f#@k them they’ll be sorry” hate speech be damned! | Chris |
| For many landlords this is their business. Why should they be penalised when other businesses are not. The land prices have become so expensive that this is the part of building a house that has become untenable and this now pushes up the prices of existing houses. Bring back National and lets get some logic into politics | Margaret |
| what a bunch of dreaming no-hopers this Govt is. No business knowledge, sense, acumen (all words missing from the Labour dictionary) and they don’t even wonder or care that their policy will not work. | alan |
| The Labour Govt policies will bring this country to it knees. Jacinda has proven to be our Worst Prime Minister in the country`s history since the arrival of the Maori. | Frank |
| Failure to properly address the “supply” side of the equation will simply “feed the fire”. Here comes the correction folks. | Vic |
| Smoke and mirrors – pretending to do something while doing nothing. But they continue to promote the socialist agenda unabated and without scrutiny. | Bruce C |
| They are dogs barking up the wrong tree. | jd |
| never ever! | gerard |
| Comrades just cannot understand the motives that drive and manage good business. | Maurice |
| Be aware NZ, deductible business costs will be next. | Ray |
| not only get rid of the rma but thin out the half wits in council, the qv mob and make sure socialist cindy never enters govt again, but what worries me you dont even hear a grumble from national or what their plans are, so not only investers will get rid of properties but what renters are left will have to fork out more, so i can see tent cities forming to house the homeless in the not distant future. now with the shortage of timber less houses will be built so what plans does cindy have to sort that out, buy every one a camper van! | Richard |
| NZ is really up the Warr Zooo | Susie |
| These lying Marxist fools seem really to have to the bit between their teeth, and there will be no stopping them. Next will be further attacks on the farming sector. NZ will be ruined and unrecognizable before they can be voted out. | Tony |
| This ‘government can pride itself by being the first one in New Zealand’s political history which has achieved absolutely nothing. If they are re- elected for a third term ( not impossible because of this general apathy and massive indoctrination), we will see a rapid destruction of our economy and pressure building on ordinary working people . I said it before and say it again : People will only start to think and listen when the really hurt. | Michael |
| The autocratic labour socialists will pay dearly for this attack on Mum and Dad landlords at the next election. These new laws will be repealed when the next Govt. comes into power. | Darien |
| This urgent legislation has not been subject to prudent consultation and in-depth research which sadly will result in unintended harmful consequences. | Peter |
| Utterly ridiculous… | Clive |
| Not a snowballs chance in hell! | wally |
| More houses needed, money too cheap – these are the issues. Plus, never forget, local councils base rates on property value so have no interest in seeing prices fall. | Tim |
| Rents will rise which was demonstrated in Herald when a pensioner was given a $135 per week rate rise after this announcement. This Government has no idea what they are doing!! | Chris |
| While the sun shines, the good rains bring life for bounteous food crops and our fantastic New Zealand shores, border one of the greatest backyards in this world, we have a Government that is deliberately swinging the helm, to a vast coast, of lethal rocks! The sequence of broken promises, misguided efforts to correct, and a mind-set that Socialism is the best outcome, the people have to endure this juvenile, risky and floundering escapade, with little option to intervene. With the recent past of law change and policy shufflings, it seems unbelievable that we, the people of NZ are the payers of all these inept parliamentary actors incomes. They are there to serve this country and it’s people, in the best possible way: and yet, it’s all turning sour, hopeless and generating a wave of nihilism to peoples lives. Ardern and her puppets are on-track, to deliver NZ, ever closer to a single world Government system, with a single currency operating and eventually, will find us devoid of any genuine autonomy. Consider one factor alone, which this Labour party is endorsing heavily: I state emphatically that I am not racist in any way–I take all people at face value, yet there can be no factual truth to the claim, that the Maori people with their own dignity and Pride, are not an Indigenous population. They originally came to these shores, as the white people did, by ocean-going craft from distant lands. Neither they nor the white/European peoples, can claim a right of original ethnicity. In fact as common sense prevails, while the Morioris’ would have more claim as an indigenous race, that cannot be confirmed or denied, as I understand it, through lack of documented evidence. Yet this claim as an indigenous people of NZ, is one of the major hinge-pins to their ‘sovereignty’ drive and incorrectly endorsed by the shameful guidance, of the UN. And they have solid backing from this current, socialist juvenile Government! As far as the Vaccine issue goes, it might be profitable for people to carefully check this move. Consider the proximity of Covd 19–and no confirmed source or origin, the very short time to produce a range of vaccines, perhaps the most politically unstable time in history, all coupled with the roll-out of a very powerful, 5G communications system, probably capable of efficient, world communication options. Data propagation, have it all in their hands, for good or evil. | Alan |
| Can only make it worse. Rents will increase and first home buyers will loose hope of ever getting into a property of their own. Removing the tax deductibility for mortgage interest will make owners of rental property sell up and therefore reduce the available housing for renters. This Government is not fit for purpose! | Ann |
| This, like most of their solutions is self serving nonsense . And 50% voted for them. Fools ! | Bill |
| Does not address the issue that House Supply is less than House Demand. Expect rents to go up, not hugely but investors will need to cover the Tax payments. | Craig |
| cut immigration build more homes | greg |
| Not in 100yrs will this work. | Andrew |
| It will create more problems for different reasons. | steve |
| It is time to “CUT the CRAP ” Get a grip on the REAL World . Do you copy? | Christopher |
| The Government will eventually be paying out more benefits due to people not being able to afford rents. GVs initually had a lot to do with house price increases and fare enough, government said our value is this so one is entitled to at least that. Looking at this reason means the government needs to devalue (living also beyond our means) of course they won’t devalue and one main reason is the tax take from council rates is huge, as the council base their rates on the value of your property. So the councils love it too. | Owen |
| It will result in higher rent being paid by tenants though! | Hugh |
| This forum seems to have discovered that Ms Ardern is a liar, as is Mr Robertson. What a surprise, not. That’s what the partisan left do. Expect more for the next 2 years until the election run-up, | Monica |
| It’s draconian. We are getting out of being landlords & I’m happy to do so! Jacinda is lying to NZ. | John |
| Socialist stinking thinking | Merv |
| Socialist stinking thinking | Merv |
| It will only make it worse. They need to get rid of all the restrictive rules around building and the money grab on consents. But first we need to get rid of the DRAMA QUEEN and her loopy cohorts! | Terry |
| No way, its a supply & demand problem. | Philip |
| The first sign of insanity is to keep doing the same things over and over again and expect different results. | Lee |
| Ridiculous question. NZ’s concern, as result of this insanity, ought to be concern over what happens when foreign capital heads for the hills (and the currency tanks…). | John |
| Political bulling. | Ian |
| A modest increase in interest .rates instead and restoring deductibility for landlords maybe the way to go. | Alan |
| They have no idea. The only thing it will achieve is higher rents | David |
| it will inevitably make it worse! | Jenny |
| Any Government which ignores the advice of two of its most influential advisors, Treasury and the IRD, is showing itself to be totally foolish and economically inept. Their petty viciousness in targeting landlords as the cause of all housing ills is exactly what one would expect from this Socialist/Communist mob. | Doug |
| Nothing Labour touches works so why should this? | Graeme |
| No – it will take rental housing out of the market. Quite punitive & useless, flying in the face of established tax law. | Peter |
| These new rules will certainly stop most people buying hoses to rent which then falls back on Government to buy them or build many, many more state houses themselves to put the people that vote for them in. | Eric |
| If the government removes the limit that we can spend on your rental house , we could spend money on maintainence and create thousands of jobs and offset the loss of interest tax changes | George |
| Brutally obvious to even the dullest observer. | Mark |
| Here we go again, another step down the communist path. Hopefully the people of this country will wake up before it is to late. Probably a forlorn hope | Tom |
| But it will appeal to the crowds of unthinking supporters of the accelerating introduction of Marxist ideology | Gordon |
| By the time the next election cycle comes around, my fervent hope is that voters will not forget the knee jerk policies, the blatant disregard for advice and the damage this Labour govt has blundered on with. How do these new regulations increase the housing stock?? | Robert |
| a pacifying knee-jerk reaction created by spin doctors in haste to be seen as ‘doing something’ against advice from rational common sense institutions. | rosa |
| They haven’t got a clue, just making wild promises. | mel |
| There are two ways to destroy a country. First is to bomb the country. Second is bad Economic policy. Lets see what happens in a year. | John |
| Successive Governments have dug themselves into a deep hole in housing that they simply don’t know any politically viable way to get out of! For Labour it’s desperate times calling desperate (poorly conceived) measures. | Colin |
| A better solution would have been to place an embargo on investors buying/bidding on residential housing if they already own 3 or more houses. If an investor bought a rental property in the 1980’s for instance and calculated a return of 10%, that would be a fair return for rent setting. Skip forward to now, that property’s valuation may have been used to buy other properties, but the likelihood is that it is actually now mortgage free. Tot up the costs/expenses now and see what the return now is, based on “market” rents! They are exploitive and unfair to tenants. This use of financing for the next purchase will always exceed the ability of a first home buyer to compete at auction. The investor then does his 10% return calculation based in the price he/she paid, plus its projected costs, and that is where the new rental price comes in. This new ‘average’ then becomes a benchmark for this investor (and others), to raise the rents within their existing portfolio’s, even though it could be considered absolutely unjustified. | Vic |
| No, but don%u2019t forget that Cindy got the Wiggles to the front of the queue. She%u2019s good at something. | Kevin |
| The basics are Supply & Demand. Not much is said about addressing Demand. Population growth worldwide is unsustainable. This should be the UN’s top priority. Ghost house utilisation should be on governments radar. | Douglas |
| labour have rarely solved any problem except that of extorting tax under any name or excuse they can find. | Peter |
| FAT CHANCE | Tim |
| Absolutely not. This govt is sending the country into oblivion. They really have no idea – I can’t believe the number of sheeples that voted for them. | Dave |
| Only communists and idiots could come up with such ridiculous policies. Our lot meet both descriptives! | Allan |
| Absolutely, completely and positively NO !! This government has no worthwhile ideas and remember that it is likely that we will have another 5.5 years of Jacindaism. | David |
| morons | Robert |
| The stupid being led by the blind, through a desert devoid of constructive solutions | George |
| our present problems stem from john key’s mass immigration policy | teryy |
| The reality is that the UN agenda is to make it harder and harder to be independent until all citizens are unable to afford to own anything and forced to surrender their assets to the state, thus becoming reliant on the state to provide, thereby giving the state control of the people. Jacinda is following the UN agenda completely. | Linc |
| We keep talking about a housing crisis but is the real problem the lack of well paying jobs? | Darag |
| This Labor Govt. is the most destructive in New Zealand history. They are hell bent on racially dividing all citizens and now they will ensure those taking the risk to provide for their retirement are taken out. Lies and corruption come to mind. Ms Ardern and her rabble are not trustworthy. . | Sam |
| It will only make it worse for renters. These cost will have to be past on or rentals sold, This will put more stress on the already huge shortage of rentals. | Murray |
| Of course it will solve the “CRISIS”, it’s obvious!. Yeah right!. | Peter |
| just another , naive cock up ,not even thought through with advise from well informed intelligent people…..AGAIN !! | Roy |
| Of course it wont fix housing affordability. Nothing government does these days fixes anything.. | brooke |
| Classical socialist thinking. It’s all about having your voter base gleefully observing you bashing the nasty rich people. Typical envy tax. | Charles |
| you don’t fix a problem by creating another massive distortion in the market. | Allan |
| They can not solve anything. | Gayle |
| When your treasurary and your ird depts advise you not to do something you would think ok , let’s try something else. Just shows you how shallow this bunch of nohopers really are. Boy is Cindy showing her colors now, red!!, | Peter |
| We should all be aware of the consequences of this latest attack by the government. The attack on property investors who, in many cases, operate their portfolios as a business. Like any other business, any costs incurred operating the business are deductable as being legitimate operating costs. But NOT if the business relates to rental housing. There seems to be reason why this government wouldn’t apply the same rule to all business costs As for rentals, who will eventually pay the cost of the landlords non deductible costs? I wonder who that might be. The tenants probably. Go figure. | Ray |
| Sooner rather than later the loans from China and the Government’s printing of money will come home to roost. Surely by now the realisation by the majority of New Zealanders that this Government is as dishonest as any Government can get and their drive to socialism/communism is behind every lie and exaggeration they have made for the last six months. Surely the advice from the IRD and Treasury are not just flights of fancy drifting on the wind. But then, because of the wonders of being elected to govern, Miss Ardern and her sycophants have been granted undeniable clairvoyancy and the ability to know precisely what “Her Nation of 5 Million” truly want without the need for any form of consultancy. Anyone with any business acumen must realise that removing interest payments as a deductible cost of doing business and the introduction of CGT through the doubling of the Bright-Line regulations and the draconian increase in penalty payments, is not going to stabilise cost but increase the need for landlords to recover these new impositions – an increase in rental charges and and sale values. Perhaps this is the insight one gains from serving the local fish and chip shop. | Michael |
| Never have we imagined such a clueless government. Once again Labour has done what Labour does. Create problems that it can then throw money at to solve – except it doesn’t solve them. Labours whole claim to fame is destroying values, ethics, & morality at the top of the cliff and then throwing masses of money to fix the damage at the bottom of the cliff. | Jack |
| Policy that lifts productivity & concurrently incomes is a key missing element of. this Govts reactionary approach to improve housing affordability. Another display of arrogance toward property owners prepared to offer their homes for tenancy & a complete lack of understanding economics | Paul |
| My recommendation has always been that -interest should be tax deductible for first home buyers for the first five years. This would put them on more of a level footing with investors. The small tax loss to the government would be far out weighed by the social & economic benefits resulting from higher home ownership. | bruces |
| Only a dreaming socialist would believe such crap | Carl |
| No it will have the opposite effect | Doug |
| Its absolutely missing the mark, and will create worse problems and inequalities over time. | Robbie |
| it will exacerbate the issue. | Lione |
| Just build heaps more houses and price will come down | Joep |
| This country is going to be driven into absolute poverty of a third world country The part- maori labour MPs will ensure the continued financial appeasement to their people and the Labour government is desperate to kowtow. Socialism along with apartheid government %uD83D%uDE21 | Darryl |
| Property investors will sell up it is no longer worth the effort There will be less available to renters | tony |
| Hoe could it?? That sad lot in Parliament made decisions totally bereft of any comprehension of what economy and economics are all about. If they carry on like that NZ citizens will seriously start to hurt and it will be interesting to see — by the time the next elections come up– if they will wake up to the fact that they have bet on the wrong horse. | Michael |
| What else would you expect from an incompetent minister with a BA degree and an even more clueless bunch of Comrades around him? | Geoff |
| I DON’T think Labour’s housing package will solve the housing crisis. They haven’t come up with anything in the last four years that helped us as a nation. Ms Ardern wants New Zealand to be at the forefront of the New World Order, and she wants us to be a Socialist/Communist state, not a Democracy. Her leadership will be the death of us as One People. | Joyce |
| Interesting though that our almost totally ineffectual National opposition actually came out and said they would repeal elements the legislation. A shame that they haven’t been as equally proactive in respect of the institutionalised racism in respect of Maori that has become so prevalent under this Government. When are the Nats going to stop pandering to Maori and recognise that we are a multicultural society in which all elegible citizens should have equal democratic rights | Rob |
| No No. This govt. has no idea. One minute they throw money at a problem; the next they punish sectors of the economy because they don’t like property investors making a profit. The housing problem will reduce if they start building houses people can afford. And first home buyers can afford the lower deposits. | Graeme |
| Stupid, punitive, typical marxist thinking policy. Arrogant to the extreme if using urgency to push through policy and not even getting advice from the relevant departments | David |
| No, No, just proves Communists are in the process of overtaking our country, Amazing how SHE HAS SUCKED IN KIWIS. VERY, VERY ANGRY. I’m in my middle 70’s and been through all this shit in the past Doesn’t WORK. I WAS A Merchant Seamen and communists f***ed up the New Zealand Coast. | Ian |
| There is nothing they can do it is far too late to stop the (TRAIN) so to speak until it becomes a total wreck. A housing bubble burst | David |
| No but there are huge numbers now of dumb stupid Kiwis who are continually drunk on Arderns lies and deceit We have the worst government ever but really who the hell will do anything about it. I write to politicians but get no replies so what the hell Dog eat dog | Don |
| So far Labour is all talk no do — plenty of platitudes but no action. | Alan |
| I would like to have seen the Gov’t buy up and lease back the land value thus reducing the mortgage necessary for first home buyers. These buyers could reduce the land component when able and repay the Gov’t over time. Loan only for first home buyers. | Peter |
| Of course not. Removing Government regulations that slow house building is the only way to solve it. | Geoffrey |
| It%u2019s a simple process to the housing problem. More building and to do this release more land, help infrastructure so that the entire cost is not on developers and make it cheaper/free for all trades people to get GREAT qualifications | Helen |
| The only thing that will sort it , is for these idiots in power, to go down to building supplies , buy some material and start building, Nothing will change until supply out strips demand Go Figure | Murray |
| It%u2019s against fair democratic practise and tax laws. I am expecting an equally sudden extra to prevent any rent rises under any circumstances for a set period. Dangerous, socialists with a growing look of meglemnia | Helen |
| Section availability is the main precursor to the housing crisis. Until this has been settled we will be in this situation forever. Correct me if I am wrong but investors are not the problem as the houses they own are still available for rent. Housing is not lost for the population. It is a shame that State Advances loans were stopped. It was a good way to get young marrieds into homes in the 50″s, 60″s 70″s. | Dennis |
| It is guaranteed to make first home affordability even tougher. | Richard |
| communist pricks | Greg |
| As my 98 year old mother has always said NEVER trust a communist | Hugh |
| Just like the new Light Rail announced to Day | Les |
| They don’t have a clue. | John |
| Unequivocal no. Insanity. | Gill |
| Words fail me – this “government” is a disgrace. As a nation I believe we expect “fair play” in all matters relating to government directives which concern the people, and this “fair play” should apply particularly to the ability to earn income and be taxed on profit NOT turnover! How can one type of business have different tax rules applied to it relative to others! | Roy |
| No, this latest move will not succeed. Are there any Labour MPs with foresight and credibility to vote against their party? | Peter |
| It is likely to push up rents, as landlords incur additional costs, especially with interest costs no longer being deductable from income, and a 10 yr bright line tax test. | Donald |
| It want solve the crisis but it will help. | Paul |
| We have to build more affordable housing We have to allow councils to free up land to have these homes built on. | Sue |
| They do not want to solve it ,that is more than obvious | Francis |
| I think they would have trouble pushing a pram let alone organizing a housing affordability plan! | Stuart |
| I’m wondering should it be challenged in court? Is it legal, there is a legal precedent that expenses are tax deductible?? | Peter |
| All they have done is penalize landlords with a raft of tax measures. Basically a pile if lies being spun by this out of control government. | Lawrie |
| Absolutely NOT. Irrational decision but not surprising as it is part and parcel of the government’s march to complete socialism! | Tony |
| Borrowings against capital gains should be treated as a cash income, which it is, and taxed. It wouldn’t fix the housing problem but its a simple way of limiting deposits that ramp up prices. | Allan |
| not anything in this package will save house prices from increasing. | gary |
| ?? | Bill |
| It will not assist the housing supply problem what so ever. I believe rents will rise adding to the detriment of those trying to save for a home. This recently announced policy will do absolutely nothing towards fixing the problem. Although, they way this government is performing Kiwi’s may well pack their bags and head off to a brighter future in Australia or Canada, that will put a few houses on the market. | chris |
| another bungle on behalf of the Govt just so sad for those that want on the property ladder | Russel |
| Labour is taking an additional $1.7 Billion dollars in tax per year by taxing rental providers on their turn over rather than income. Could someone please show them what the sign is used for on calculators. When you add an additional cost to something the price for the consumer does not go down it goes up. | Glenn |
| Adding taxes and non deductibility of costs goes back to Muldoonism interfering with the market. Political interference has the opposite of the desired effect on the economy. | Rob |
| Removing mortgage interest deducibility erodes an age old business tradition of turnover minus costs = profit. This has immediately created massive instability in the market with a mortgage broker friend informing me that it has frozen construction projects across the country. So now we have a government that just makes up its own rules. I’m advocating for businesses in general, my tenants and my own business’s survival. Time to say enough is enough. | Ruth |
| I think this Government has to be the worst Government we have ever had. Lies, dodging the blame, hamstringing civil liberties and individual rights, supporting Mallard with tax payer money and now making it hard to plan for retirement. Sounds awfully like George Orwell and “all animals are equal but some are more equal than others.” As for the plethora of Maori policy – takes my breath away. I thought we were a multi cultural country with equal rights no matter what ethnicity you are. Thy have to go and we have to make it happen at the next election. | Alastair |
| A drastic move doomed o fail. | Brian |
| This is just going to be counter-productive. Much more restrictive and all-encompassing measures need to be taken. Take a leaf out of the Canadian model to understand the impositions required to reduce our catastrophic housing prices. | Tony |
| What a bunch of Amateurs we have in Government at present, driven by a failed Socialist Agenda. A ‘Headless Chook’ of a so called Business Model. And the worst is yet to come. | Geoff |
| Coarse it wont Concentrate on the demand is required even more so now Carter Holt Harvey cannot supply critical building materials. Amazing that raw logs are being shipped to China – why not support sawmill industry with supply | Alan |
| Labour doesn’t understand how to run N.Z. Finances!!! | Susan |
| Labour have again shown they have no business acumen. The sooner they are gone the better. | J J |
| With the latest moves against rental housing investors, on top of a stack of undemocratic moves like the imposition of maori wards on local bodies, New Zealand’s Labour government has in the short time since the general election proved itself unfit to govern. It will certainly reap its reward at the next election, if not before. | Rob |
| You would be stupid to think it would | Mike |
| Absolutely not. They are slowly but surely driving property investors out of business. Houses are needed by home owners, would be home owners and renters. Jacinda and her communist comrades are slowly but surely pushing renters out on to the street by driving landlords to the end of their tether. Where are all our tenants going to live once we have all sold our rental investments to first home buyers. | Urban |
| Since when did an increase in tax on existing houses equate to an increase in houses? Strange logic! | Ronnie |
| This is a return to Muldoon’s play book and we know how that ended. | Sid |
| What New Conservative was advocating with regards to the “freeing up of land” was reasonable in my mind. Any land that was zoned for residential had to have started to be developed within a certain period. If not, it had to be sold on. I am near an area, where “land Banking” means a number of large farms have been bought up and the owners are just waiting for Auckland to move in their direction, before they “cash in”. They have another lever too. either limit, or stop immigration into NZ until the housing catches up. Or if they were really bold, not allow houses to be auctioned, which I would guess would bring prices down by 50 grand or more! | Ted |
| You can’t fix something if you can’t identify the issue/problem – unless your political ideology overrules any and all considerations. | Mike |
| Only a fool would think so! Houses need maintenance which varies according to the care of the people living in them. It is significant to note that that previous governments exited the housing supply market years ago to evade the expense. That the brave public who have stepped up to bridge the neglected gap with many hard working mum and dad savers for their future and that of others, is no excuse to burden them more and screw them over. The risk now is abandonment of this supply and dropping the supply responsibility back in the Govt. lap who have shown great ineptitude by an apparent supply of a total of 12 homes in their term of office. Hallelujah! | Barry |
| And also I think it is shocking that 1. Jacinda has broken her public unequivocal promise re Capital Gains Tax and 2. they have removed the interest deductibility on rental properties. | Rose |
| This policy will only hurt renters, add to the cost of housing and will do nothing to bring on more housing which is the REAL answer to the issue. | Phil |
| I don’t believe they do either | sheryl |
| EVERYTHING that Labour has done while in Government has only achieved a massive division of all people within New Zealand. The lack of housing and the lack of rentals can only be blamed on this Government. Who in their right mind could support them … only total losers that keep getting handouts, criminals who know that there are no penalties for committing crime and Maori Radicals who seem to have the Government under their control. | Des |
| Clearly not, shows the government especially the PM to be a liar. If people own rentals as a business then of course they she be eligible for the same tax advantage as any business as they provide a service. They are forcing far to many radical socialist changes. | Steve |
| I just wonder if Ardern and Robertson have a brain between them as those who will suffer will be those that rent with rent increases and those landlords who decide to exit the market and leave a renter on the street. Now watch the homeless numbers grow .House prices will rise regardless of these restrictions The cause is the lack of supply and to think that this Government is so thick that they cannot see this . | ken |
| We want more house to rent not less | Lynn |
| The only way to solve this shortage is to build more affordable homes and release more land for housing. | Bryan |
| they have proven they cant address the supply side (failure of Kiwibuild etc), and all they have left is to attack landlords, and by default renters. | John |
| No way! | Scott |
| Labour caucus is manned by a small group of theoretician taught academics with meaningless degrees with little or no hands on experience in commerce or practicalities. Navel gazing wishes to garner votes and of no substance or real value will not solve a problem of any importance as has been demonstrated since the last two elections. | Max |
| I’m speechless where is the opposition? You have to ask yourself what the hells going on | Peter |
| This is a patsy question, no sane person could support such stupid policy. | Terry |
| Will not be worth taking the risk of a poor or nil return on investing in a rental property so could reduce the number of houses to be built, | jim |
| Merely a propaganda campaign to make people think the government is doing something positive for them, however the reality is Jacinda will make life much worse for renters, for mums and dads trying to get ahead, in reality I don’t think she gives a rats arse about real outcome of her actions or the general populous as long as she is still gets positive press ! | John |
| Labour have no idea how to govern at all. | Bruce |
| Of course they won’t , absolutely ridiculous | Graeme |
| No, not a chance. They missed the bus a long time ago. | William |
| it won’t affect the cash buying property speculator, if they are playing the rules, they won’t be ignoring their tax obligations, if they make $200,000, pay their tax they are still probably $130,000 better off. This government are continually proving they are in a fools paradise | Jim |
| This is the worst political decision in my entire life.Are they trying to destroy NZ? | Jim |
| This government has no idea whatever to fix the housing dilemma. or has no inclination to do so.After all it is a LABOUR gOVT AND SOCLALISM WILL NEVER SOLVE ANYTHING. With all the lies this Govt has subjected us to they should resign forthwith and call for new election. | John |
| The issue they should have addressed is the lack of land available for building however, we have a Govt of numb-nuts who are good at kidding a lot of New Zealanders that they are doing the right thing. Total BS – we will all pay the cost for this in the long run. Time to move to Aussie! | Glenda |
| Absolutely not. | Ann |
| It will exacerbate rather than solve the problem and will further punish tenants who are arguably the most vulnerable members of adult society. | Mark |
| This is an absolute disaster and it will have the reverse effect. This govt is acting as a dictatorship. | Ken |
| Solve New Zealand%u2019s housing affordability crisis? Not a show. As a landlord, there will be a few sums to do in relation to the losses the “business” will incur, then bump up the rents accordingly! That is what transport operators do when fuel prices go up, so what is the difference? To single out landlords is criminal and corrupt. So Labour is par for the course!!!!? | Neil |
| The opposite will happen and they will wonder why but what would we expect | richard |
| It simply favours owners over investors and does absolutely nothing to increase the supply of houses which would have occurred with the removal of urban boundaries. We need to be talking affordable houses and that requires affordable land. Land is the single largest component of a new house | John |
| Hell No bunch of idiots | Lyn |
| only make matters worse | Colin |
| labour keeps engaging in the politics of envy, thinking this will buy votes,but it will not! | norman |
| The package just creates more problems | Hamish |
| The Labour Govt are fools | Mo |
| very disappointed with this proposal for a first tier economy to endorse !!!! | neal |
| never – no thought of quick building – just tax increases – | Beth |
| Not now, not later and certainly NOT SOON. Why cant people see how Socialist this Government is. It is ruining our country. | Robyn |
| The government is incompetent and arrogant in disregarding the advice given to them by Treasury and the IRD. Once again we see measures pushed through without consultation. Neither of the moves will produce more houses. Rents will probably increase and availability of rentals decrease. | Paloma |
| The crisis is about land supply. | Edgar |
| Children playing with the future of NZ. Simply Abominable!! | Alex |
| My farther was Mr X in1973 as Bill Rowling called him for being NZ’s 2nd biggest speculator who paid more personal tax in a year than most people did in 10 years Labour has learnt nothing from history and they ld do research when trying to introduce NEW things which are already 50 years old. Mind you Tinkerbell was not even born then and knows nothing about the housing past as do most others in her Parliamentary group though I notice quite a few own extra houses | Allan |
| Likely it will make it worse! | Gail |
| Not a chance whatsoever | David |
| sorry nothing Labour does solves any problem | Graeme |
| This Labour Government have YET again proved their ability to Govern. This is NOT a peoples government BUT a Labour RUN KNEE JERK Government. | Carl |
| Sheer idiocy | peter |
| It will totally increase the problem for everyone not least of all the Labour Party | Shaun |
| No business person would make such decision(s) without taking expert advice and acting on it not ignoring it. | Ian |
| They have lost the plot. Shame on you Grant, I thought you at least could be trusted. Silly.silly me! | Dick |
| Not only do these changes punish all property investors but they disenfranchise the smaller (Mum & Dad) investors who saw rental property as a comparatively safe retirement nest egg. Another kneejerk reaction by Labour that will only serve to achieve the complete opposite of what they (presumably) want. | Glenn |
| Nothing that Ardern and her fellow communists have brought into law in NZ is working. She is a disaster. How anyone could have voted her in is a mystery to me. Will we get another chance to vote her out? I wonder. | Jenny |
| Typical Labour. Politics of ENVY. Vote them out. | Dennis |
| I just hope that someone is keeping a ledger of Promises made vs Promises kept for the end of term report of this government. I suppose that this week we found that behind those pearly whites lies a forked tongue. | Awake not woke |
| Absolutely NOT ! | James |
| Totally impractical !! | Graeme |
| They haven’t got a clue!!! I don’t think any of them have an ounce of understanding of economy! | Andy |
| Absolutely not. The only way the housing crisis will be solved is by building tens of thousands of new houses. That can’t be done quickly…certainly not under this government who don’t seem to recognise the constraints on new builds. Jacinda & Grant are panicking because they can see the wheels starting to come off. The media is getting bored with Covid and is starting to focus on housing. This is Labour’s worse nightmare. | Derek |
| Absolutely brainless. Hopeless in the extreme | jeff |
| I don’t think even the Labour Cabinet believes the new policy will solve anything! It’s pure politicking and irresponsible governance. | Tim |
| Seriously? | Rodney |
| democracy out the window fully with next agenda item. | mike |
| The only thing Jacinda achieved was to exercise a measure of success with the control of Covid. Since then they have returned to form as a woke mob of socialists rushing to meet the Maori wish for apartheid and brown privilege. The National party are a rabble of headless chooks. No leadership, no teamwork, no ideas and no guts.The rest are dangerous. “The country is in the very best of hands.” God defend NZ.. It’s going to get worse! | Bruce |
| Not a hope> | mark |
| I do not believe that a government can influence house prices. All the government can do is set a level playing field and let the market function. | Errol |
| No, and now of course rethinking my logic to have supplied a near new 4 bedroom house to the rental market, because my business plan has been nullified. Selling up as soon as tenants lease ends. | Claire |
| Clearly Labour do not understand economics 101, supply and demand. Local council policy and the RMA are the biggest problems. | Mark |
| Policies developed by incompetents to satisfy their ignorant voter base. Wait for the reaction with the inevitable rent rises. | Henry |
| Ignorance Reins | Ranald |
| If anything it will make it harder for younger people to get a start up the property market ladder. | Bryan |
| Common Sense is absent from the NZ Labour .Govt. | Ian |
| Unbelievable!!!!! | Derek |
| I don’t believe Labour think it will either. | Steve |
| Government is totally out of its depth with not an economic brain amongst them. Knee jerk policy based on ignorance of reality inevitably produces unintended consequences which are often far worse than the problem they’re purporting to address and this is no exception.Watch this space! | Bernie |
| It is not ideas Labour needs it is people that know and understand | Andrew |
| And it is probably too late to do anything about it. Why doesn’t somebody ask Helen Clarke what she thinks and publicise her comments if she is brave enough to do so. | william |
| Absolutely, definitely, for sure, no! | Joe |
| In my opinion, until these economic idiots are tossed out of government, they’ll just plough on wrecking damage at every turn. I never thought I’d ever see such an ignorant PM running (or should that be ruining) our lovely country, just to fulfill her communist dream. the worst PM this country has ever had. | Merryl |
| Socialists could not even work out a 2 piece jigsaw! | Chris |
| It will only make matters worse by driving up rent and reducing the number of houses available for rent. | Allan |
| It is going to drive rentals sky high | John |
| First the housing crisis is an economic problem and must be solved by economic and not socialist solutions. It is purely a supply and demand problem Limit supply to below demand levels and prices WILL RISE. The answer therefore is to increase supply and that unfortunately needs the replacement of the RMA and local bodies being forced into releasing land for development. A recent example is the solution in Christchurch after the earthquakes whereby the very limiting provisions of the RMA were overridden and the supply of houses increased substantially. However the socialist solution will be if these regulations do not work then more regulations are necessary when the real answer is free market enterprise | Robin |
| Another political driven policy that is not going to fix the housing crisis, we need to urgently reform the RMA and fund local authorities infrastructure for new subdivisions rate increases will not work for this | Barry |
| Certainly Not. Only make matters worse!! | June |
| What this government has done is totally illogical. I am lost for words as to their stupidity and that doesn’t happen often. | Kevin |
| It will make it far worse by reducing the number of rental houses and increasing rents. It will also set a precedent for the removal of tax deductions on interest for other industries. | Alan |
| It would have been better if they had followed Housing 101 | Roger |
| will cause a short term drop but with a much bigger overall impact on the NZ market as a whole | Mike |
| It is not the shortage of rental properties but the cost of compliance that now outweighs the benefit of rental. Owners now have No control over their properties once the sign a rental agreement and absolutely no course for against bad tenants. Also a large part of the shortage demand is the destruction of the family unit in preference to solo mothers occupying rental accommodation. | Don |
| This policy will have a backlash on the tenants as landlords try to recoup their increased costs | Brian |
| This Govt can’t see ahead to the results of their actions | Nev |
| Unbelievable!!! | Colin |
| It will be another dismal financial failure similar to the new Hamilton / Auckland Rail link, recently commissioned. | Pierre |
| How can it? It drives up rents, prevents investment and has done nothing to resolve the difficulties created through the Resource Management act!. | Barbara |
| A stupid package | Graham |
| One word….dysfunctional. Hope people will see this | peter |
| All they have done is drive up rents more & put perspective landlords off so the outcome is very bad for renters as landlords sell up & invest their money elsewhere. so no money for new builds | nigel |
| We have a government of incompetents staggering from one bad decision to another. How can people with virtually no real world experience understand that bad decisions lead to market distortions and unintended consequences. | Lee |
| Dump the RMA and get on with infrastructure and of course release more land we have been talking about it for the last 40 years | jack |
| Might make it worse | Don |
| It might help, but it’s not the 1 shot cure | Kevin |
| What will they do unchecked next… remove the ability of other business types to deduct all expenses before being taxed? | Dean |
| It surly must be illegal! Publicly saying Landlords exploit a tax loop hole is a lie. Your comments are apt and timely. I was a National supporter but now change to ACT. National are increasingly weak and irrelevant!! | Paul |
| That level of stupidity doesn’t come naturally. They must really work at it! | Clive |
| Another Kiwibuild success story in prospect….. | Zoran |
| It will only bring in more tax which is what they want. Not serious about housing really. | Nick |
| Further proof that the lying Labour politicians trying to run this country are in total confusion, a direct consequence of their disregard to the expressed concerns of responsible people. As an 85 yr-old ordinary citizen with no party politics in my background I worry about the self-destructive antics of our Government. | Edgar |
| This is bullying from a government which despises private enterprise success. The cause of the problem has been mass immigration. For over a decade successive governments have allowed 70,000-plus people into the country each year without the infrastructure to support them. Now the sky is turning dark with chickens coming home to roost. | Gavin |
| Absolutely not! These socialist are totally out of control as socialist do because they believe they know best and their will should prevail. These are very dangerous people – idealists who have no idea of reality and no regard for official advice and no regard for public opinion. | jd |
| What a vindictive government we have. The changes they introduced are appalling. They will not solve the problems in the housing market at all. Instead they are aimed at punishing New Zealanders who are trying to save for their retirement. It is appalling. | Jason |
| They are breaking their promises left right and centre. Let’s hope their popularity plunges. You cannot trust a Labour Government. | Brian |
| These policies are not even addressing the problems that prevent new houses from being built so how can they possibly solve the housing affordability crisis. They should be instructing councils to remove urban boundaries, freeing up land for building. But instead these socialists are determined to persecute property investors. | Paul |
| I was shocked by the housing changes. We made investment decisions based on the rules that existed at the time and now they have upended the rules. These politicians are incompetent – clutching at straws. They have no idea how an economy works. | Mary |
| This government hasn’t a clue how to run the country. By the time National is ready to govern, they will have destroyed NZ. | Thomas |