Housing Portfolio Cabinet Reshuffle Yields Few Results

First National Real Estate Chief Executive, Bob Brereton, says the coalition government cabinet reshuffle demoting its chief architect Phil Twyford, who has been shunted sideways in favour of Dr Megan Woods and Chris Faafoi will yield few results in solving the housing crisis. Mr Brereton says that the fundamental flaws in the Kiwibuild programme to date will not be solved by a change in personnel. The basic issue with the concept remains; the housing crisis as defined is fatally flawed.

“The problem has been entirely misinterpreted, the government seems to be confusing a lack of accommodation with a lack of affordability for first home buyers. First home buyers are currently above historic averages in terms of activity in the marketplace, the current programme of stigmatizing Investment buyers whilst enduring with a Kiwibuild programme that turns out houses best suited to investors makes no sense”.

Mr Brereton says the real issue seems to be around the lack of affordable rental properties and that the current government focus is doing little to address this issue and in fact is more inclined to exacerbate the issue with reduced stock and increasing rents. “One location touted by this government as a shining light of the success of Kiwibuild is Te Kauwhata. However, my information suggests that they are repeating the mistakes of the much publicized Wanaka debacle and in building 175 new homes in an area hoping to reinvigorate and energise a location with little employment and a large commute to work is madness. Will the taxpayer want to own 175 newbuilds in Te Kauwhata because the demand to buy a first home there does not exist?”

Mr Brereton says the Kiwibuild brand itself is toxic and a mere rethink of how it is delivered is futile. Rebranding is simply not enough; a total rethink of the underlying problem is what is required. “There are areas across NZ where affordable housing exists, even in Auckland the numbers of houses in the under $650,000 range deemed affordable by Kiwibuild exist. Not only do they exist but are available in numbers which exceed the 141 houses delivered by Kiwibuild to date.”

Mr Brereton says that he doesn’t see the tight rental market correcting itself anytime soon and continued vilification of the investment property sector runs a real risk of making the situation worse. “One bright spot from the reshuffle is the appointment of Chris Faafoi, who has shown himself at the top of the pile amongst the current crop of ministers, and expect delivery of State houses to continue to be impressive. However this seems largely unrelated to the problem so high on their pre-election agenda and the increased demand for State housing seems a symptom of policy rather than a positive outcome.”

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