• Property site finds surge in Chinese interest in NZ
• Chinese newspaper editor calls Labour claims "racist"
• Barfoot & Thompson launches investigation into leaked data
• Privacy Commissioner says outcome can result in complaints
Labour leader Andrew Little has defended the party against claims of racism over the leaking of real estate data that showed the scale of Chinese buyers in Auckland's real estate market.
Critics have accused Labour of blaming Chinese for Auckland's heated property market and playing the race card.
Auckland-based Chinese daily Mandarin Pages ran a front-page editorial accusing Labour of having "a Winston Peters" and saying there were 99 other reasons for the city's high property prices.
Editor David Soh said: "Labour has every right, as the main opposition party, to question the Government's housing policy. But to single out a particular ethnicity or nationality is quite irresponsible and racist."
The editorial, penned by Chinese journalist Kevin Yeung, said reasons for record high property prices included a supply shortage, high material costs and migration.
The comments follow the release of leaked sales data by the Labour Party, and published in the Weekend Herald, that showed 39.5 per cent of Auckland house sales between February and April were to people with Chinese surnames, despite people of Chinese ethnicity making up just 9 per cent of the population.
Influence of foreign buyers
Mr Little told Radio NZ today that the average income of ethnic Chinese living in Auckland was below the average income overall, so it would be "madness" to say they were buying so many top-end houses.
"What this does allow us to conclude is something people have been saying anecdotally - there's been no hard data because the government won't collect it - and that is that the impact and influence of non-resident buyers in the Auckland housing market is significant. It's not just the Chinese," he said.
While the Government was not collecting information on foreign buyers, what had been released was the "next best thing", although Mr Little acknowledged it was "crude".
"It's not because people [are] looking different, it's because their names stand out and we've done analysis and research on the names and with 95 per cent accuracy they are of Chinese descent.
"The issue isn't about being Chinese. It's about non-resident foreign buyers."
His comments come as Chinese real estate site Juwai.com said that New Zealand was one of the most attractive countries in the world for Chinese property buyers.
A spokesman for the site said it had seen a surge in interest in New Zealand over the past year, with New Zealand jumping from number 12 to number five in online searches.
However, its data showed most overseas Chinese buying property in Auckland had a link with the city and were not leaving their houses empty.
No restrictions on foreign buyers
Juwai.com spokesman Dave Platter told Radio NZ: "It's relatively inexpensive for Chinese buyers compared to buying in something like Beijing and Shanghai and they like the fact that English is spoken in New Zealand. Especially if you're studying internationally, most Chinese want their kids to learn English above all foreign languages, and the fact they can do that in New Zealand is a real draw."
He said New Zealand was also an easier place to buy, compared with countries such as Hong Kong and Singapore, which had recently increased fees for foreign buyers, and Australia. Canada, the US and the UK weren't so tough, however.
"Most major countries New Zealand compares itself to have no restrictions on foreign buyers," Mr Platter said.
"There's no doubt that over the past year New Zealand has become more popular but that means it could reverse at any time. It could become more popular, it could become less popular. It's just a question of the condition in New Zealand and the condition in China."
Mr Little refered to Juwai.com's figures saying they confirmed "what we have known anecdotally, and what just about every Aucklander who's been in the housing market for the last two years will tell you, and that's there are people on the end of the phone who are not resident, don't make a commitment to New Zealand, but want to buy property here, who are shutting others out of buying a property in Auckland."
He said Labour decided to release the figures because of the public interest in what they showed.
He wouldn't reveal who was behind that decision but said a "wide range" of people were involved, including those of Chinese descent.
'Chinese save more'
The editor of Mandarin Pages said that while local buyers did not like bidding against the Chinese, sellers loved having them at their auctions because of the perception they would drive up prices.
The tenor of many online responses on Chinese forums such as Skykiwi said Chinese people worked and saved hard to buy Auckland residential property, while New Zealanders spent up.
Skykiwi, which introduces New Zealand culture and lifestyle to the Chinese community, has 750,000 page views a day.
A spokesman said many people went on Skykiwi to defend their buying habits.
"People are saying they're working very hard and earning money and getting the reward and they have a different consumer behaviour to people who were born in New Zealand. It's because of Chinese tradition and cultural - they're quite happy to save the money," the spokesman said.
However, he also attributed differing attitudes to a cultural divide. "It's the difference between east and west cultures. So they say, 'Okay, we're working very hard and we're happy to put money into Auckland'."
The spokesman said he could not ascertain if respondents were based in China or New Zealand.
BNZ chief economist Tony Alexander joined the debate yesterday, calling on New Zealand leaders to require foreigners to build new places rather than buy existing Auckland houses. It comes amid warnings that rich Chinese investors will be looking to take their money out of China's turbulent stock market and invest in property overseas.
"We should as soon as possible adopt Australia's rules restricting foreign buying of anything other than new housing unless resident for 12 months," Alexander wrote.
A property insider, who did not want to be identified, said the issue was much bigger than depicted in the Labour figures. He said 80 to 90 per cent of residential properties in parts of Auckland were bought by Chinese money in March.
Barfoot & Thompson chief executive Wendy Alexander said the company would start its own investigation to identify if it was the source of the leaked data. Barfoot sells one-third of Auckland properties and managing director Peter Thompson said if the data did belong to the firm it had been given illegally.
"We don't know whether it's our information. We're just seeking advice on any steps we need to be taking if it is our data. That's all I'm prepared to say."
Mr Thompson released a detailed memo to all staff yesterday, warning they must not disclose any internal figures and must act in the interest of their vendors.
Privacy Commissioner John Edwards said people could lodge a complaint to the commission for possible breach of information.
"If the source of the home buying data is established, people who think their personal information has been included can make a complaint to my office and we will look into it."
What the data shows
The leaked data
• Labour received leaked figures covering 3,922 Auckland property sales by one real estate firm from February to April this year. It carried out its own analysis on the figures, using surnames combined with other data.
• Labour used a statistical technique called Bayesian analysis to estimate ethnicity from surnames. This combines a number of data sets, including Census meshblock data and the electoral rolls database, to estimate the probability of whether a name is European, Maori, Chinese, et cetera.
• The analysis cannot prove statistically whether a buyer is a foreigner or local. Labour's view that most buyers must be from overseas is based on the fact that ethnic Chinese make up only nine per cent of the population but 39.5 per cent of the house buyers. However the Census figures are from a large base of 1.4 million people, whereas the house buyers data is from less than 4,000 sales.
• The data comes from one agency and does not show sales by other agencies. It does however contain 45 per cent of the sales in that period in Auckland.
• The Weekend Herald has seen the leaked sales figures data and reviewed Labour's methodology. The party updated its figures based on our feedback. We were not able to redo the analysis independently, as it relied on data sets such as the electoral rolls database, which is only available to political parties.