People could live in those ghost houses, Jacinda Ardern | The Jackal

4 Aug 2021

People could live in those ghost houses, Jacinda Ardern

You can understand why Jacinda Ardern is somewhat hesitant to do more about tackling the housing crisis. After all, making houses affordable would effectively mean that billions of dollars of paper wealth would be wiped from people's books. And with a considerably larger percentage of the voting public owning property compared to those renting, it really just comes down to a numbers game.

It’s also of concern that much of the economic growth we see in New Zealand is because of a white hot housing market, which along with their own personal vested interests, is likely a major reason most politicians aren't interested in implementing any robust policy initiatives that could cool things down.

One of the main drivers of the housing crisis, which economist Bernard Hickey now describes as a catastrophe, is the large amount of dwellings in New Zealand that are empty. The latest census put the figure at 200,000 houses, which is a hell of a lot of property to just leave vacant. So why isn’t the Government doing more to fix this major problem?

On Monday, Newshub reported:

Jacinda Ardern not convinced by 'ghost home' concerns despite data showing 40,000 vacant in Auckland

Prime Minister Jacinda Ardern is not convinced by "ghost home" concerns despite Census data from 2018 showing nearly 40,000 vacant houses in Auckland. 

At the 2018 census, there were nearly 1.9 million dwellings in New Zealand. Nearly 200,000 of those were unoccupied. The vast majority, 33,360, were in Auckland. The number of vacant homes rose from 6.6 percent in 2013 to 7.3 percent. 

It led Auckland Mayor Phil Goff to explore the idea of filling vacant houses with homeless tenants, or with nurses, police and other essential workers. But nothing concrete came of it. The Māori Party meanwhile campaigned on slapping owners of empty homes with taxes. 

An empty house levy would be one of the best ways to stop the trend of well-to-do people buying up houses that they don't plan to live in. And despite their fears, such a tax isn’t the political death knell that Labour believes it to be.

That’s because the current Government has already upset the landed gentry with their healthy homes standards and other worthwhile housing initiatives. Any further loss of support would therefore be minimal if some substantial policies were enacted to deter people from continuing to bank on investment property, which is one of the main reasons housing has become so unaffordable in New Zealand.

But Ardern, with the ultimate decision-making power, doesn't seem too concerned about it, telling The AM Show on Monday she's spoken with local councils to get an idea of whether these "ghost homes" are contributing to the housing crisis. 

"I've gone to local government and said, 'Can you quantify how many vacant homes we have, do you see this as the issue?' And from the councils' perspective, their view wasn't that we had a large-scale problem with vacant housing." 

Duncan Garner, host of The AM Show, told Ardern the local councils she spoke to are "dreamers", because the data came from the official Census. 

"The Census isn't able to then quantify whether or not, for instance, that's someone who's genuinely not consistently using the home," Ardern responded. "We have asked that question of those who are most able to tell us."

Ardern said councils aren't the only ones looking into the issue. She said consultancy business The People Place has also looked into whether ghost homes are contributing to the housing crisis in Hamilton. 

"From their perspectives, they haven't viewed that as being a major contributing factor. However, we've continued to ask those who would know."

The Prime Minister is entirely wrong here. Firstly, a Human Relations firm from Parnell aren't the people to decide if there's a problem with vacant houses in Hamilton. Furthermore, when a census is taken, a property can be visited numerous times to determine whether it’s inhabited. The census is also the only data available, so it should therefore be relied on.

Jacinda Ardern is basically saying that the census takers don’t know how to tell if a house is empty or not, which would pour cold water on the entire census process and therefore all the Government decisions based from it.

"The second question becomes, OK, if people have got vacant houses, what do you then do? So Duncan, what are you proposing, that we tell people they can't own a second home and then not use it?" Ardern said. 

Garner said as Prime Minister, she should have the solutions, not him. 

"It is a fair question to say, if we think we identify that someone holds a second property that they are not utilising regularly, what do you then do?" Ardern said. 

"At that point, the only solutions you see in other countries is that they put in tax disincentives. I want to know that that is genuinely a contributing factor before we would consider some of those options, and at the moment, when we've gone to those who may know, they've said that they don't believe that that's been the largest factor for them.

"In fact, I remember when I asked that question of local government, they said, 'Actually, we think issues like covenants are more of an issue for us locally than people sitting on vacant properties'."

The Prime Minister dismissing census data in favour of anecdotal evidence from councils, who have a financial incentive to keep the housing crisis going, is all about the political ramifications of implementing a tax on empty houses. It has nothing to do with doing what is best for New Zealand, and everything to do with Labour choosing to placate wealthy homeowners to ensure their re-election.

Unfortunately Ardern displayed a similar biased approach in the lead up to the cannabis and euthanasia referendums. On one hand she openly supported people being able to choose to end their own life, but on the other she wouldn’t even let the public know which way she was going to vote on legalising cannabis, just in case it influenced that referendums outcome.

This had nothing to do with pragmatism and everything to do with political expediency. 

Of course the current Government is removing hurdles to ensure developers can build more houses. They’ve also directly or been financially involved in assisting around 9117 new public houses to be built since June 2018. But this will only maintain the status quo and in no way put any downward pressure on house prices in New Zealand, which will likely continue to be the most unaffordable in the developed world even with a left-wing Government in power.