Barry Soper: Govt waves big stick at housing problem

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Opinion

It was a day of popguns as opposed to bazookas, of damp squibs as opposed to silver bullets and game players rather than game changers.

All those cliches spilled from the mouth of Labour's loquacious Phil Twyford, who seemed to be living up to his middle name of Stoner.

Well he must have been on another planet as National beat its bleeding gums in the lead-up to releasing the National Policy Statement - which is essentially a tool of the cumbersome Resource Management Act that ensures the sustainable use of resources.

But the Government never promised to deliver a bazooka, a silver bullet or a game changer when it comes to getting people in houses. Just like the Labour Government before them, they know that they can't dictate housing prices - the market does that for them.

And Labour knows the current white hot buying frenzy's been fuelled by what some would consider peppercorn interest rates - and in Auckland's case Nimbyism, or not-in-my-backyard when it comes to increasing housing density.

So rather than waving a magic wand at the problem, when in reality there isn't one to wave, they've waved the big stick, telling the council to free up land which will see new suburbs being built alongside far-flung suburbs.

And there's no point whining about yesterday's big stick not covering off who's going to pay for the roads, sewage and power polls in the new suburbs, as Labour did when they debated that very issue three years ago with the reform of the Local Government Act. That allows for councils to charge developers through Labour's favoured bonds.

The National Policy Statement was never going to cover that off and they know it.

So far recent moves have stopped speculators from buying and selling before the ink's dry on the purchase contracts, as they had been doing. They now have to wait at least two years. And loan to value ratios have been set at a higher rate for investors, meaning they have to have more cash before they can buy another property.

Talks are currently underway between the Beehive and the Reserve Bank on setting debt-to-income ratios - which look at how much the trading banks can lend versus what you have to earn before you qualify for a loan.

Of course of the face of it that will make it even harder for the first home buyers. But again, if there's a distinction between investors and the rest of us, that'll at least cushion the blow.

Who'd want to be in charge of this mess?

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