Property speculators not welcome | The Jackal

28 Jul 2013

Property speculators not welcome

Today, the NZ Herald reported:

Today, Labour leader David Shearer told TVNZ's Q+A programme the policy would put a halt on foreign speculators coming into the housing market and pushing the prices up.

"We're going to restrict, almost totally, foreign ownership, to buy established houses that are here.

"What we want to do is to make sure that first home buyers are Kiwis and they have the best chance."

New Zealand was one of the few countries in the world that allowed foreign ownership of established houses, he said.

Excellent! I wonder what the current governments response will be to ensure more Kiwis can afford to purchase a house?

Housing Minister Nick Smith said it was a sign of how desperate Labour and Mr Shearer had become.

"The oldest trick in the political book, whether it be over crime or unemployment or affordable housing, is always to blame the foreigners.

"There's no evidence that overseas buyers are having any discernible affect over house prices."

It was an "unprincipled" policy because it exempted Australia, Dr Smith said.

"They are the largest group of non-resident home buyers."

Oh dear, what a complete idiot the Housing Minister is. Firstly, this is not a desperate move by's a policy that looks to increase home ownership. If Nick Smith's comments are anything to go by, it appears that National is against more families achieving the Kiwi dream.

Secondly, there is obvious evidence that shows foreign investors buying 9% of residential properties (PDF) in New Zealand is pushing up house prices. One of the main reasons houses are so expensive is because there simply aren't enough to go around. To say otherwise means that Nick Smith doesn't understand basic financial principles such as supply and demand.

Thirdly, Australia isn't the main group of non-resident home buyers. The United Kingdom at 16% is. They are closely followed by China at 15% then Australia at 14%. Both China and the UK restrict foreign property speculators.

However, a New Zealand citizen can purchase a house in Australia, which means such an initiative is principled because it effectively evens out the playing field. If Labour is racist for limiting foreign property speculators pricing New Zealanders out of owning their own homes, then so are all the other countries that don't allow New Zealand property speculators to buy up properties there. The critics cannot have it both ways.

In my opinion, that fact alone makes the claims that Labour is being xenophobic entirely incorrect. But I guess that's the only response we're likely to get from a bunch of neoliberal wankers who've been profiting at the expense of ordinary Kiwis for far too long.