Isaac Davison is a NZ Herald political reporter.

Budget 2016: New hope for house hunters

English signals measures in Budget to release more land.
In Auckland, overseas buyers snapped up 4 per cent of the 11,995 homes sold. Photo: Doug Sherring
In Auckland, overseas buyers snapped up 4 per cent of the 11,995 homes sold. Photo: Doug Sherring

Finance Minister Bill English has signalled that further steps to address housing shortages in Auckland will be announced in the Budget to help more people into their own homes.

It comes after new data revealed 3 per cent of the 45,115 houses sold nationally between January and March were bought by non-residents. In Auckland, overseas buyers snapped up 4 per cent of the 11,995 homes sold. Chinese buyers accounted for 2.3 per cent of all sales and almost 60 per cent of sales to non-residents.

Mr English labelled the long-awaited figures on foreign buyers a "red herring" which confirmed that offshore speculators were "a small part" of the demand.

"It's an influence on the market but not a big influence. The big issues in Auckland have never been foreign buyers, the big issues have always been the council enabling more houses to be built faster."

The foreign buyer statistics were collected by Land Information New Zealand following concern that offshore speculators had been building portfolios of New Zealand property and pricing Kiwis out of home ownership.

They painted a very different picture to data produced by the Labour Party last year showing up to 40 per cent of the city's houses were sold to people of Chinese descent, based on the sound of their last names.

The data was attacked by opposition MPs yesterday as "not worth the paper it was printed on" because of exemptions.

And property economist Rodney Dickens said the actual number of overseas buyers could have been three times higher before new IRD disclosure rules being introduced in October.

The Government has said that a land tax is a possibility if foreign buyers are shown to be a major contributor to rising house prices.

It was not yet known whether the new data would trigger a land tax or other demand-side measures. Land Information Minister Louise Upston said 12 months of data was needed to get a clear picture of the issue.

Mr English said the Budget on May 26 would include announcements around the strategy "of working with the council to get more houses on the ground faster and getting the Government using its own land and housing in Auckland to help the supply problem".

This was a reference to the Government's policy of identifying surplus Crown land in Auckland for housing developments, a portion of which must be sold at an "affordable" threshold of below $550,000.

Despite the gaps in foreign buyers data, Mr English said the figures were "credible" and corresponded to estimates by the real estate industry a few years ago.

Arguing over the figures would not help a middle-income family trying to buy into the Auckland or Hamilton markets, he said.

Green Party co-leader Metiria Turei said the new data was "nowhere near the full picture" because businesses, trusts and some student and work visas had been exempted.

Labour leader Andrew Little said the figures did not undercut Labour's argument about foreign speculators.

- NZ Herald

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