Mike's Minute: Common sense finally prevails with foreign buyers

Author
Mike Hosking,
Section
Video,
Publish Date
Wednesday, 20 June 2018, 9:35AM

Could we be seeing just a little bit of light and common sense at last, when it comes to the train wreck of an idea that we ban all foreign buyers when it comes to housing?  

Based on nothing more than a grandiose dose of electioneering designed primarily to appeal to xenophobes, the idea was to take all foreigners and prevent them from ever putting another cent into a New Zealand house.  

They were the ones who had jacked up the market, prevented first home buyers getting in, caused all the trouble and probably importedMycoplasma Bovis to boot.  

The facts and the figures, of course, told a completely different story.  

But the government weren't interested in any of that.  

And so the bill was announced, and the gasps could be heard all over the land from anyone who had ever had anything to do with property.  

And not only couldn’t you buy , unlike Australia where you could build and therefore increasing the stock, here you could build, but would have to flick it on. Thus making, of course, building pointless.  

As submissions were called for, everyone lined up from telcos, to developers, to councils explaining the bleeding obvious, it was a dumb idea and we would be the ultimate losers.  

And now, the changes.

Allowing the pre-selling of up to 60 percent of big housing projects to foreigners,  waiving the requirement to on-sell in big developments,  and allowing resident visa holders not just permanent residents to buy land without overseas investment permission.  

If you believe the rumours it was Phil Twyford, to his credit that saw these issues all along, and David Parker that was the roadblock.  

But whatever, they're at least seeing a little bit of reality.  

The committee that’s put all this forward is not united, and National and ACT don’t see it as going far enough.  

They still claim it's bad law.  

But here's how politics works, governments get to do what they want, this one does a lot of stuff off the cuff based on ideology.  

And with little regard for common sense, and in say the oil exploration case or the 3 strikes, no regard for the wider view of the community.  

Given that, the best you can hope for is some sort of limit to the damage along the way, with the over-arching view that when another government gets to power they see the error and correct it.

So what we have is the halfway house approach. Faced with the overwhelming reality that they'd failed to understand the basics of business and building homes on a large scale.

I.e. you need foreign money. Choking that supply off was a mistake.  

New Zealand has, does and will always need and we should add  ”want” foreign money to make our economy tick.  

Never more so than on housing.  

This is at least recognition that they failed to see it, realise it or accept it until now.  

So in that sense, it's a relief common sense is winning the day. And they've worked out their mistake.  

Should it be further changed? Of course.  

But this is better than it was and what it was, was a cluster.   

 

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