The PM would not be standing by while house prices soared – and look what happened

In January this year Prime Minister Jacinda Ardern insisted: “We can’t stand by while house prices increase at the unsustainable rates we saw in 2020.”

So   what  has  happened  since?

During Auckland’s level 4 and level 3 period – August to November – house prices rose $113,000, or 8.3%.  In the 12 months to November, Auckland prices rose 27.9%.

The  speed at  which house prices have  risen  in  NZ  has  even attracted   the  attention of The  Economist.  It  noted  recently  that

“… in  the  past year, prices in NZ  have  shot  up at a  pace of  more than NZ2000  a  week.  Costs in  big  cities have been  going  up  for years, propelled by a  mix of  cheap  borrowing and  a scarcity  of  new homes”.

The  pandemic  has  made matters worse:  lockdowns  boosted  demand while   labour  and materials shortages constrained  housing  supply.

The  Economist  said that as housing  costs rocket,  governments  besides NZ’s have  taken  aim   at  large  investors.  Others include Spain and Ireland.

The  government  in  this country has  a  fresh  target  and  has   wasted  no time  in publicising   the  fact  that  new  Opposition  Leader  Christopher Luxon  is  the  owner of  seven properties.

Radio  NZ  reports that house prices in 2020 rose 15%  nationwide.

It  says so far in 2021, house prices have  risen more than that, at 22.8%.   At the start of this year the average house price was $839,000;  now it is $1.03m.

Since November 2017, the national average house price has risen 54%.

That’s  some  achievement the  Ardern government  has  racked  up, critics  may  say.

The average national house price then was $670,000, according to Quotable Value.

Some  authorities  reckon  a  buyers’ market in  housing may  emerge  because  there  has  been a  surge  in  new  listings  recently.  But   a  legacy  of  Covid   will almost certainly  be  global  inflation  and  there  is  every indication inflation in NZ  could be running at 6%  next year.

So  what  about  renting  accommodation?  The  news  isn’t  great  there  either.

Data published by interest.co.nz. shows the biggest jumps in rents were recorded in Papakura and Franklin in Auckland’s south, and in Tauranga and Hastings, which all recorded increases of more than $70 a week.

In the main urban districts the cheapest place to rent a home was Timaru, where the average rent in the September quarter this year was $363 a week. The most expensive district was Auckland’s North Shore on $625.

Point  of   Order  looks  forward  to learning what the  Prime Minister  will offer, as a promise  on  housing  and  its  costs, come January 2022.

One thought on “The PM would not be standing by while house prices soared – and look what happened

  1. The PM promised the most open and transparent government, the PM promised electoral integrity, the PM promised no vaccination mandates, the PM said she did not lie, the PM minister said 3 Waters would be optional, the PM said that the Pfizer was safe, the PM and her government are competing with first home buyers on the housing market and pushing up prices. Would you believe any promises from this PM?

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