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The housing crisis in New Zealand is firing up voters ahead of the general election on September 23rd. The issue of housing effects almost everyone, from homeless people to young families who face losing out due to the inflated prices. In the past decade, New Zealand’s house prices have risen by more than 50 percent. While our country has become a haven for wealthy foreign investors, there is no question that the New Zealand property market is unsustainable. That’s why housing is a hot political campaign issue, with both Labour and National promising to make New Zealand housing affordable.
The problem of housing is mainly to do with very strong immigration and a shortage of skilled workers in construction. This has resulted in a struggle to build enough homes to meet the demands of population growth, fuelled by record immigration. However, the concerns over the lack of affordable housing in New Zealand could swing voters. At present, 77 percent of people who rent in New Zealand cannot afford to buy a home. So, it’s a question of which party can best solve the problem and the public have their eyes primarily on the two biggest political parties. There are key differences between how Labour and National have approached the topic of housing. However, there’s no denying it’s a central issue, as it also is to the other political parties, such as the Greens, NZ First and Maori Party.
Labour is taking a more aggressive approach to housing, pledging to ban foreign investors from buying existing property in New Zealand. Labour leader Jacinda Arden has said if they were to win the election, the ban would be imposed at Christmas. The party also wants to build 100,000 affordable homes over the next ten years, with 50% of them in Auckland. National is firmly against banning foreign buyers, holding the argument that a ban could cause New Zealand to lose important trade agreements with other countries because they would likely have to renegotiate existing trade deals. In addition, Labour is cracking down on speculators in other areas, including those who buy property for the sole purpose of making a profit. So, they plan to extend the time period in which investors will have to pay tax, from the current two years to five years. This new rule would ensure people pay their fair share of tax when buying and selling property. There’s also Labour’s plan to create an affordable housing authority to get homes built faster.
National’s main response to the housing problem is to build 20,600 affordable homes and 5,200 social houses over the next decade in Auckland and other major cities. National will focus on making homes affordable for first-home buyers, as they plan to make 4,500 of total homes built available for less than $650,000. Also, National has promised to bring in new urban planning laws to make building faster and cheaper in high-demand areas. This new plan will require councils to supply land for housing in correspondence with population growth. Conversely, Labour would scrap the rules that stop developers from building high-rise buildings as well as building beyond the margins of a designated urban area.
No party has won an outright majority since 1996 and whether this election will be any different remains to be seen, the issue of housing however is likely to be a key factor behind New Zealand’s collective vote. In spite of our frantic property market, house-price inflation is slowing. House values actually stalled in July, rising just 1.6 percent. This may be because properties are taking longer to sell or because of stricter lending from banks.
None of the parties’ policies are guaranteed to be successful: building more homes depends on many factors, such as the availability of skilled labour and capacity in the construction industry. Both National and Labour have showed ambition with their pledges, but the outcome of the vote remains too close to call.
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