The two-track housing market that has developed under National is underlined in QV’s latest report, Labour’s Housing spokesperson Phil Twyford says.
“QV’s index shows many homeowners in the regions are facing declining equity in their properties, while in Auckland and Canterbury home ownership has become a distant dream.
“Looking at house prices over the last six years it is clear that values in Auckland and Canterbury have increased dramatically, yet the rest of the country has been going backwards.
“Auckland house prices have gone up 30% and Canterbury about 20% when you adjust for inflation. The rest of the country has seen values decline over that period. In areas such as Tauranga and Wellington they have been flat-lining but in other areas – the Far North (-26%), Southland (-17%), Waitomo (-33%)* – have fallen sharply.
“The Government’s failed housing policy is exacerbating this two-track housing market. Auckland and Canterbury are struggling to build their way out of acute housing shortages, and the Government’s hands-off approach has seen housing accords signed but not a single new house built in the special housing areas a year after they were announced.
“Meanwhile loan to value ratio lending restrictions (LVRs) and interest rates heading north of 8% – both introduced by the Reserve Bank to deal with the problems in Auckland and Canterbury – are chilling the housing markets of regional New Zealand.
“The Government seems oblivious to the situation facing homeowners in places where the value of houses has taken a massive hit since 2008, places like Southland and the Far North. People have spent a lifetime paying off the mortgage, and now their biggest asset is wasting away as they face retirement.
“It is more urgent than ever that Government intervenes decisively in the failed Auckland and Canterbury housing markets. The current approach of tweaking the planning rules and hoping a broken market will fix itself has failed completely.
“Labour will build 10,000 affordable starter homes every year for ten years, tax speculators with a Capital Gains Tax that excludes the family home, and reform monetary policy to bring down interest rates. Bold action to fix Auckland and Canterbury will remove the need for the LVRs and increased interest rates that are hurting the regions.”