Labour claims they can build Auckland homes for $360,000

August 27th, 2014 at 3:55 pm by David Farrar

The Herald reports:

would be able to offer first home buyers two-bedroom properties in Auckland for as little as $360,000 if elected, party leader David Cunliffe announced today.

Labour’s KiwiBuild policy would build 100,000 new, affordable homes over 10 years and sell them at cost to first home buyers, Mr Cunliffe said.

“Using the purchasing power of the Government and off-site building techniques we will be able to lower the cost of building a home.

“This will enable Labour to sell a new two-bedroom terraced KiwiBuild home for around $360,000 in some parts of Auckland.

“That compares to around $485,000 for a similar Hobsonville home.” …

Labour’s housing spokesman Phil Twyford said KiwiBuild would deliver the equivalent of a Hobsonville $485,000 two-bedroom terrace home for $360,000 by forgoing the developer’s margin on the land cost-saving $36,000 and a further $89,000 would be saved by using off-site manufacturing, bulk buying building materials and reducing builders’ margin through high-volume tendering.

If Labour do win the election, it would be amusing to see them actually try to implement the policy and the excuses they’ll come up when the homes cost way way more than that. Maybe they’ll blame the unions for pushing the price of labour up!

Socialist parties always think that the state can provide things cheaper if you get rid of the profit margin, and economies of scale. But, you know what? The history of the world is they almost never do.

By this logic, we would all have much cheaper food if the Government owned all the farms. Think how much cheaper our food would be if farmers did not make any profit from the land, and instead the Government just employed them all directly?

And think about how much cheaper our food would be, if the Government centrally purchased all agricultural supplies for farmers. It would reduce the cost of farming massively, and hence food.

How about this for a challenge to Labour. If they really think they can produce two bedrooms houses in Hobsonville for $360,000 at no loss, then why don’t they promise to reimburse the taxpayers for any homes they build that cost more than that? Why should it be our money they gamble with?

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67 Responses to “Labour claims they can build Auckland homes for $360,000”

  1. Raphael (88 comments) says:

    “off-site building techniques” is that code for cheap pre-fabs?

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  2. Kimble (4,443 comments) says:

    In before Judith.

    It isnt code, Raph. “Built off site” means “pre-fabricated”.

    Just imagine all the other interventions Labour will be “forced” to engage in that will be required once this policy fails.

    Labour can’t build a $360k house in Auckland? Solution: price controls! Quotas! State monopsony!

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  3. Gulag1917 (1,026 comments) says:

    Labour have a long tradition of not being able to deliver what they have promised in the housing industry.

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  4. Ross12 (1,456 comments) says:

    I think the key phrase here is “two-bedroom terraced”. Coronation Street type housing so they cut down the cost land/house. Therefore I do not think it is out of the realms of possibility. But will people want that type of housing?

    Raphael —off site techniques does not necessarily have to mean “cheap”. I think it has to be the way to go to get better quality control and costs down.
    (NB. I’m not a Labour supporter)

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  5. Rich Prick (1,729 comments) says:

    “we would all have much cheaper food if the Government owned all the farms”

    We should ask North Korea how that worked out for them.

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  6. rangitoto (251 comments) says:

    Can you buy a section for that?

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  7. freemark (618 comments) says:

    Terrace houses, prefab much more than current techniques..yeah right.
    Massive truss & wall factories built, right next to railway lines of course, oh, what do you mean these bits won’t fit on the wagons/tunnels/roads etc.
    Did I miss the bit on Cunner’s CV where he was a builder as well?
    Inexperienced 16 year olds on “a living wage” running around building 30 houses a day..yeah right.
    Some fools will believe this I guess

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  8. thedavincimode (6,877 comments) says:

    Translation:

    Admiral cunners, home renovator and do-up merchant of Herne Bay, is going to become a property developer using your money and our collective balance sheet to assume development risk including weather-tightness exposure on dodgy pre-fabs.

    As part of this cunning plan, the fuckwit who can’t even manage his own caucus will be setting up Kiwihouse Building Merchants and Kiwilogistics to manage building supplies procurement and supply logistics in real time on the grand scale that will deliver these slums to the down-trodden masses.

    Rest assured, that no site foreman will ever be standing around twiddling his thumbs asking: “where are those f****** trusses that were meant to be here a week ago?” Nor will any lucky suppliers/subbies to Kiwihouse ring shouting things like: “where the f*** is my f****** money a*******; I sent the f****** goods/did the f****** job three months ago”, only to be told: “I’m sorry sir, we have no record of that and please don’t be offensive”.

    If only the Ministry of Works hadn’t been binned. This would have been perfect for it.

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  9. PaulH (1 comment) says:

    In order to make valid comparisons and appropriate comment the headline of the topic needs to be correct. I think your headline ‘Labour claims they can build Auckland homes for $360,000′ is incorrect. They said they can sell houses for $360,000 which includes land. To say ‘build’ excludes land.

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  10. Crusader (323 comments) says:

    Rich Prick (1,624 comments) says:
    August 27th, 2014 at 4:10 pm

    “we would all have much cheaper food if the Government owned all the farms”

    We should ask North Korea how that worked out for them.

    Or Ukraine, for that matter. State collectivisation killed millions by painful starvation, while idiot socialists from the west praised the “new world” being created by the USSR.

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  11. Andrew61 (5 comments) says:

    Yeah that worked out really well in the old East Germany didn’t it, where the not for profit state monopoly produced the Trabant a two cylinder two stroke car that was made from papier-mâché, yes it really did have papier-mâché in the construction of its body. Obviously much more efficient than those terrible cars manufactured by those awful capitalist car companies in West Germany. The secret of the socialist houses is that they will be constructed out of papier-mâché, I hope that it doesn’t rain much in Auckland.

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  12. flash2846 (289 comments) says:

    Yeah but did anyone hear Duncan Garner on Radio Live talking to a journalist who was at the policy announcement?
    Cunliffe and Labour totally fucked it up.
    Firstly, no-one knew what houses were the subject of the press release, including Cunliffe and all the Labour people present. Then Cunliffe described the couple who were trying to buy said property and stated that the couple were expecting a baby and desperate to buy their first home.
    Then (lol) the couple were interviewed and they said they weren’t even planning to buy a home in the near future. Not only that, the couple had been planted and were from the EPMU; they forgot their script.
    What a bloody shambles; this had better be on TVNZ, TV3 and Campbell Live or else!

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  13. G152 (387 comments) says:

    All they have to do is find the carpenters, plumbers, electricians, painters and concrete workers.
    And site developers and roading contractors,
    So where are they coming from (as Liebor refuse to allow immigration) ?

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  14. Huevon (223 comments) says:

    I heard from someone who has bought one of the new lots out in Hobsonville that the cheap houses set aside as “affordable” hardly got any interest. The vendors were expecting a stampede, but basically if you signed up in time you got it. Anyone able to verify that?

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  15. Redbaiter (9,657 comments) says:

    “Labour claims they can build Auckland homes for $360,000”

    National are just pissed off that they can’t build them for that…

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  16. IGM (529 comments) says:

    This apology for a man is daily becoming more of a fiscally dyslexic goose than ever. Best he apologise for claiming to have financial degrees, before he is found out to have misled us with that claim also, on his CV.

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  17. Raphael (88 comments) says:

    Ross12 (1,249 comments) says:
    August 27th, 2014 at 4:04 pm
    I think the key phrase here is “two-bedroom terraced”. Coronation Street type housing so they cut down the cost land/house. Therefore I do not think it is out of the realms of possibility. But will people want that type of housing?

    Raphael —off site techniques does not necessarily have to mean “cheap”. I think it has to be the way to go to get better quality control and costs down.
    (NB. I’m not a Labour supporter)

    Oh, I know some off-site construction can be very well done, but I’m thinking in terms of their policy, in order to meet the targets, it will be given to whoever does the cheapest bid, and they will be using the cheapest methods they can get away with to keeps their costs down.

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  18. Simon (763 comments) says:

    The mong is stong in this one.

    Profit is related to directly valuation and these morons in the middle of a housing bubble are projecting out 10 years. Utter fuckwits.

    The $360,000 house could be sold/worth $485,000. Yeah ok. If these clowns get underway there wont be a market.

    Profit is made by producers responding to consumer demand and being efficient. Take away profit and all that is left is inefficient crap. Welcome to Kiwi build.

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  19. mara (797 comments) says:

    So they are going to build ghettos for the near future. What could possibly go wrong?

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  20. Tarquin North (364 comments) says:

    Did he include the unions cut in his figures? If he gets in they’ll want paying.

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  21. hmmokrightitis (1,595 comments) says:

    And whats to stop the original buyer flicking it on for profit?

    The promises these fucktards come out with used to astound me. Now its just shake of the head, because I know its vote buying. And their ability to ‘balance the books’ comes from taxing ‘rich fuckers’ harder and harder.

    Im hopeful – still – that National can hold these dicks at bay for another 3 years. By that stage I can sell my businesses and retire. Satan help us when they next get their turn at the trough with the fucking melons :(

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  22. oldpark (383 comments) says:

    Yes another fairytale from Labours cuckoo pie in the sky bribes.They are desperate to buy votes,promising the moon if it gives them power and the treasury benches.IN THE NINE YEARS THEY RULED IN THEIR REIGN OF TERROR, they gouged Seven Billion dollars from 2001 _2007 from household power budgets,and called it a surplus.Trust Lie-bour Party to deliver”sure cant”.Just look at their motley crew,Some of them have been in parliament nearly forty years,time for a don’t come back after 20 09 2014.

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  23. Colinxy (25 comments) says:

    The technology might be possible in the future to build houses quickly and cheaply: http://www.contourcrafting.org/

    I don’t think it is ready just yet though.

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  24. hmmokrightitis (1,595 comments) says:

    Im waiting for the combined gween labour campaign ad, focused on how technology will save us…

    gweens…wait until we fire up our money printers – green jobs for everyone!!!

    labour…we can now use 3D printers to make houses – free houses for everyone!!!

    FREE PRINTERS FOR EVERYONE!!!

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  25. rouppe (984 comments) says:

    I think you’ve all missed the “some parts of Auckland” part…

    Likely to be “outer parts”, and “undesirable parts”. Though having said that, there are plenty of suburbs that once were undesirable, and became very desirable over time.

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  26. Deane Jessep (74 comments) says:

    I think they are daft morons holding on to any kind of idea that they are capable or qualified to pull this off. Land release through speeding consents, less regulation through RMA changes, etc, are the way to solve this. However there is some merit in the risk reduction that comes with public private partnerships. If they are hell bent on this I would do the following:

    1. Underwrite some or all of the risk on new developments, perhaps by taking a leasehold interest in the land
    2. Allocate/fund a team of public sector experts to manage the consent process, perhaps retired town planners
    3. Tender for one or several private sector developers to manage the entire venture as if it is their development; the private sector tender winner must set the KPI’s for the public sector team contributing to the venture, and tender weight should be given to proven but innovative ways of achieving economies of scale. Emphasis on ‘proven'; we want to attract developers from places like northern europe where the technology and codes are ahead of ours
    4. Fast track changes to legislation like building codes where required
    5. Split the ‘Margin’ in line with the investment, some of this would normally pay for consenting and risk anyway; Private Sector expert takes their share, the governments share could be returned to the buyers
    6. Walk away from each other post development; or repeat if successful and still needed

    I am not sure the above would be full proof, but economies of scale can definitely be found if risk is offset. I would have thought that lots of risk sits with the buying of the land and the consent process. Also lots more sits with code changes required to drive new technology.

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  27. flipper (4,232 comments) says:

    thedavincimode (6,589 comments) says:

    August 27th, 2014 at 4:18 pm
    ******

    Excellent!
    En passant,
    In the run up to “87,” Fletchers had a policy of delaying all bill payments. Something rendered today, would not be paid before December 25…. most probably mid January. You don’t like it?
    Go elsewhere.
    Wonderful family, the Fletchers.
    Say, where, and under which Governments, did they build their dynasty?
    Guesses?
    It was not Sid Holland or Kiwi Keith, was it?
    Try Savage, Fraser, Nash and Nordmeyer.

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  28. greenjacket (487 comments) says:

    “Labour would be able to offer first home buyers two-bedroom properties in Auckland for as little as $360,000 if elected, party leader David Cunliffe announced today.”

    By which he means a property with two bedrooms. That is all.
    The kitchen, bathroom, lounge and toilet will be extra.

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  29. burt (8,323 comments) says:

    Labout claim their policies don’t always end in recession. With that as a starting point every other thing they say is minor by comparison. It’s been established over the last 50 years that every time they get into government the economy tanks and turns to shit. But still they claim to be “better for NZ”.

    Let them claim they can build a house in AKL for $360,000 – we know they probably can’t even get near that. But we also know they will wreck the economy trying to be popular for a 2nd or 3rd term. The house debacle will be chicken feed compared to the other issues they will create.

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  30. alex Masterley (1,523 comments) says:

    I am sure the owner of Kiwibuild Limited will be chuffed to hear that the name of his company has been appropriated by Labour.
    I hope he will hold out for a decent wedge to sell the company to them.

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  31. PhilBest (5,125 comments) says:

    It almost certainly will involve a big private sector contractor.

    The potential savings have to be via government using some element of strong-arm tactics re acquisition of the land, combined with mass-production to a low standard, on very small sites per home, probably of a kind that the regulations won’t permit the private sector to do.

    I am frankly sick of crony capitalism combined with politicians creating rackets, giving us the worst of both worlds: we have a centrally planned quota scheme in urban land, combined with inviolate “property rights” – meaning the absolute opposite of “regulatory takings”. This is a big fat “regulatory giving”:

    http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=10887742

    “Land bought in 1995 for $890,000 – owner will sell for $112m”

    If planners want to save the planet from urban sprawl, they should compulsorily acquire the land at pre-regulation prices, or keep their sticky noses out of the market completely. I say this as a long-standing economic libertarian who has nearly given up on Kiwis unwillingness to let free markets actually work, especially in urban development. The next best thing is actually direct government action in the urban land market; Japan and the Netherlands both do this and we do not regard them as raving Commie governments. The current mix of “property rights” and centrally imposed quotas on urban land supply is NOT free market capitalism and no-one should defend it as superior to “growth containment” planning combined with compulsory acquisitions.

    The minute “compulsory acquisitions” are made a mandatory part of “saving the planet”, watch the advocacy for save-the-planet urban planning evaporate like the morning mist. This is driven by 80% corruption and 20% ideology.

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  32. flipper (4,232 comments) says:

    alex Masterley (1,497 comments) says:

    August 27th, 2014 at 5:15 pm

    I am sure the owner of Kiwibuild Limited will be chuffed to hear that the name of his company has been appropriated by Labour.
    ****

    Alex, please I cannot be bothered checking.

    Are U for real?
    F

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  33. uncle_tom (14 comments) says:

    “Socialist parties always think that the state can provide things cheaper if you get rid of the profit margin, and economies of scale. But, you know what? The history of the world is they almost never do.”

    …Almost never, however, Pharmac seems to deliver! So although I am not optimistic about Labour’s housing strategy, I wouldn’t write it off completely.

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  34. Richard (874 comments) says:

    Labour isn’t so much announcing policy- they are announcing Wish Lists.

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  35. chris (647 comments) says:

    @flipper easy enough to look up, here it is: KIWIBUILD LIMITED http://www.business.govt.nz/companies/app/ui/pages/companies/3708196

    kiwibuild.co.nz, kiwibuild.net.nz and kiwibuild.org.nz are also all registered domain names. They’d probably use kiwibuild.govt.nz but there’s a good chance people would go to the .co.nz though and end up at the wrong place.

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  36. burt (8,323 comments) says:

    uncle_tom

    Almost never, however, Pharmac seems to deliver!

    Yes they do do a good job of restricting the medicines available in NZ to the low end of the price market. Partly by insisting that generic’s are used and partly by just refusing to fund drugs which other countries allow and which would save more lives in NZ.

    It’s the socialist one size fits all model – It’s OK if 100 people die each year who could have been saved by some $10,000/month drugs because as a country we saved $3/month for a lot more people.

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  37. Steve (North Shore) (4,592 comments) says:

    Using the purchasing power of the Government and off-site building techniques we will be able to lower the cost of building a home.

    If Labour should become the Government it does not mean they have an open chequebook. About time Cunliffe understood that it is TAXPAYERS MONEY, not Labours’ money.
    On your bike mate

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  38. burt (8,323 comments) says:

    chris

    The existing kiwibuild domains are probably owned by Parker. Check to see if the company returns are overdue or obviously false – that will be a clue.

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  39. adze (2,129 comments) says:

    @flash2846

    Yeah but did anyone hear Duncan Garner on Radio Live talking to a journalist who was at the policy announcement?
    Cunliffe and Labour totally fucked it up.

    That sounds interesting :) Do you have a link? I didn’t see an obvious one on Radio Live’s website. Thanks.

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  40. Pdubyah (22 comments) says:

    If you could build a 2 bedroom row/terrance house for <$360K then at Hobsonville would have been the place, a bazillion acres of land.

    Pre-Construction still means you have to transport frames to – from, that'll annoy the greens.

    2 bedroom row houses are not the kiwi dream. These houses of course do not have a single or forbid double garage and therefore significant street parking. These are not pretty or upcoming DesRes places.

    Besides which, where is the land space to put these houses that are near jobs and transport.

    They are however are desirable to fill the demand for housing for the young and eager.

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  41. Milk Me (157 comments) says:

    There is no reason that quality houses cannot be built for $360k or indeed less.
    With the bulk purchasing and tight reins on the contractors New Zealanders should be in quality housing at an affordable price.
    The huge cost of materials is a major factor and Kiwi home builders have been rooted by a few suppliers that control the markets for decades. Timber should be imported from the West Coast of the US at about half the price that locally grown shit cost, cement also half the price,plaster board can be purchased from an importer for a third less than local product, hardware and fixtures also half price or less from the States, paint a third to half. , most of the framed doors are from Australia and Chile, again far cheaper than NZ prices. NZ consumers of building products have been rooted for years and NO government has stood up to them.
    That would go a long way to bringing down the price of building a home, and get the fucking council out the way and that would halve the time it took to build, after all they have proven that they are shit at quality control so independent approved inspectors should be employed, at least they would know what they are looking at.

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  42. RRM (10,034 comments) says:

    I reckon they could do it.

    You could build 2brm terrace houses pretty frigging small. Small and nasty.

    They would immediately become Somali ghettoes…

    The market doesn’t do this, because why would you waste your time building rotten little shit boxes when people are queueing up to pay $800k for McMansions? Fortunately, Labour knows better than those who risk their own money…

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  43. seanmaitland (501 comments) says:

    The thing that makes this look ridiculous for me (besides it being obvious that the homes will be very low quality), is that the government is going to have to find $36 billion dollars in up front capital to pay for these homes over the ten years.

    On top of that its going to require an army of public servants to manage the project, so the government is going to have to take a loss on it or the prices won’t be $360k.

    Unless they do some massive borrowing, then there is simply no way this is going to happen, regardless of how many builders there are to actually do the work.

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  44. Viking2 (11,575 comments) says:

    I can build a home for $360k. 3 bedroom, basic no garage. 100 Sq Mtrs., but do all those first home buyers want a home like that?
    Well hell no, its just gotta have an ensuite and a double garage, 4 bedrooms and a tv room and at least 18oSquares.

    And here’s the other problem.

    National gives the example of a couple in Auckland both earning $50,000 a year who have been in KiwiSaver for five years: they could withdraw $35,000 from KiwiSaver, receive a $20,000 new home grant, giving them a $55,000 deposit. For the Welcome Home Loan scheme they would need a 10 percent deposit, and so could borrow to buy a house costing up to $550,000.

    This hypothetical couple would be paying a $500,000 mortgage on a combined gross income of $100,000. With long term interest rates now between 6-7% and heading upwards, this would means repayments are well above the level defined as unaffordable (where households spend more than 30% of their disposable income on housing costs). Is the answer to our house price crisis to help our young people saddle themselves with a lifetime of debt?

    If housing is New Zealand’s drug, does this policy make National a pusher?

    now $500 k @ 6.5% + 32500 a year in interest alone.and it will hurt even more when the rates hit 8%.

    http://www.interest.co.nz/sites/default/files/embedded_images/image/morgan-parody-national.gif

    http://www.interest.co.nz/opinion/71667/gareth-morgan-says-national-encouraging-first-home-buyers-get-their-neck-debt

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  45. chris (647 comments) says:

    @burt

    kiwibuild.co.nz = what appears to be a UK based domain squatter
    .net.nz & .org.nz = Domus Qualitas Limited, directors are John Raymond GRAY & Roger Henry LEVIE both with Auckland addresses, according to the companies office.

    None of these addresses point to working websites

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  46. Viking2 (11,575 comments) says:

    We should also note that just in recent days Mark Donaldson from Fletcher has ruled out factory built housing as not viable.

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  47. Fentex (1,040 comments) says:

    If Labour do win the election, it would be amusing to see them actually try to implement the policy

    I don’t think you should be so hard on the idea – rather than Nationals offer to tax some people to feed others buying into and adding to housing bubble, doing nothing about the presumed lack of supply driving prices up on demand, Labour is addressing the need for more supply.

    And if they find they cannot build as cheap as they promise then they’ll be under pressure to resolve what blocks their plan – and if that means lifting restrictions on land use, which DPF often argues is the cause of higher prices, then Labours policy is a goad for them to do so.

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  48. Viking2 (11,575 comments) says:

    China’s major risk – The FT’s Jamil Anderlini has written a compelling piece on the state of China’s property market and risks it might collapse.

    Anderlini, a New Zealander, comes up with startling facts.

    These ones stood out for me:

    China’s debt to GDP ratio rose by 70% of GDP in the six years to 2014.
    Related Topics
    Opinion
    Top 10 at 10
    China

    China produced more cement in the two years of 2011 and 2012 than was produced in all of the United States in all of the 20th century.

    Land prices have quintupled in China since 2008.

    There is enough floor space being built this year to supply four years of demand.

    China’s modern residential property market (where households take out a mortgage to buy an apartment) is barely 15 years old but has never slumped.

    http://www.interest.co.nz/opinion/71641/bernards-top-10-chinas-concrete-explosion-nzs-china-risks-problem-maximising-sharehold

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  49. Milk Me (157 comments) says:

    New Zealanders developers are in the main are a bunch of shoddy cheap build fast profit merchants. people pay far to much for their houses and it doesn’t have to be that way, I have built quality on a budget price and if I can do it so can others, it aint that hard, it requires one to be hard nosed but fair. if you treat people fairly, build a trust up with your tradesmen insist on quality workmanship, source your own materials and do not cut corners it is easily done.

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  50. Viking2 (11,575 comments) says:

    . Oops – The story of the New Zealand economy over the last 30 years has been very high net migration and an ageing population. The major deficit has been infrastructure investment, in part at least because our planners have assumed a much lower population.

    Kirdan Lees and John Stephenson have written an excellent paper at the NZIER highlighting just how wrong our planners were. The implications of that wrong-ness were enormous. Could we make the same mistake again? Are we still under-investing in infrastructure? It certainly looks like it for housing and all the stuff around it.

    http://www.interest.co.nz/opinion/71641/bernards-top-10-chinas-concrete-explosion-nzs-china-risks-problem-maximising-sharehold

    Well worth a read.

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  51. Milk Me (157 comments) says:

    Fletchers is not the answer, they are the problem, I will not use a Fletchers product if I can avoid it. Fletchers the felchers can fuck off.
    Most frames and trusses are built off site anyway, that isn’t that far of pre fabrication, Fletchers don’t like it, well diddums. Fletchers are a bunch of arseholes.

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  52. seanmaitland (501 comments) says:

    @Fentex – what housing bubble – house prices outside of Auckland and ChristChurch have remained stagnant or gone backwards in the last 6 years.

    In Auckland the population growth is fueling price demand – not a bubble. In ChristChurch lack of supply is the problem.

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  53. flash2846 (289 comments) says:

    @ adz – Sorry adze no link but totally heard it during the interview and then snippets again Radio Live news. No exaggeration, this is real. I will look to Radio Live tonight etc. and try and find something for you and others.
    Cheers

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  54. OneTrack (3,237 comments) says:

    ““That compares to around $485,000 for a similar Hobsonville home.” …”

    That’s great – where are these homes going to be – Hobsonville? Yeah. Nah.

    The problem is the land price because Len is not zoning land for housing. I have to ask the way Labour carry on, does this actually include the land price or have they left that off?

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  55. OneTrack (3,237 comments) says:

    And even better, if this “works” the building industry will crash with builders put out of work. Never mind, they can all? get a job with KiwiBuild on. $18:40 an hour.

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  56. KevinH (1,236 comments) says:

    The houses being built at Hobsonville utilise tilt slab construction: prefabricated concrete walls, timber interior framing and RSJ joists over garages on the ground floor. It is an efficient and relatively inexpensive construction technique that works well en masse, an application that could be utilised elsewhere in Auckland where infrastructure already exists.
    The price being asked for new homes in Hobsonville incorporates a development levy for building from scratch infrastructure such as water, sewer, roading, parks and recreation as well as schools and public amenities. The infrastructure costs are high and reflect the current state of the market for materials and labour in Auckland. It will be challenging for the Labour Party to realise it’s ambition to build homes in the 350k bracket considering the cost of infrastructure.
    My view is that this could only be achieved by demolishing and rebuilding existing state owned properties in South and West Auckland i.e. completely flattening whole streets of houses in Otara / Papatoetoe and Henderson / Swanson.

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  57. Keeping Stock (10,443 comments) says:

    Since when have Huntly and Kaitaia been in Auckland? Surely, that’s about the only places where Labour could execute a $360k house and land package.

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  58. CharlieBrown (1,028 comments) says:

    National’s recently released policy is just as stupid as labour’s but in a different way. Labours policy is stupid as it just won’t work. National’s is stupid because it will increase demand without increasing supply of houses putting everyone back at square one but with less kiwisaver. They are two sides of the same coin.

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  59. jcuk (717 comments) says:

    Burt 5.37 … My son who is a medical doctor told me last time he visited that one of his frustrations is with people who want the expensive drug when he knows the generic will work just as well …. that is in the States … thank goodness we have Pharmac here in NZ.
    If Pharmac doesn’t authorise the expensive drug it is becuase it is not worth it on the holistic scale of their responsibility in caring for everybody.

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  60. goldnkiwi (1,550 comments) says:

    Where are all the builders etc going to come from? Clearly there needs to be a boost in training in those skills. Christchurch rebuild, all of these promises and all the earthquake proofing work required, start apprenticeships with support now!!!

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  61. jcuk (717 comments) says:

    Viking 2 6.25
    Prefabrication etc. …. As I heard it it was not that it wasn’t possible but it wouldn’t save much money. Perhaps Fletchers do not know it all these days … certainly after building two houses and other things through Fletchers these days I deal with Mitre and Bunnings.

    Goldnkiwi … one of the advantages of pre-fabrication is that working with jigs you do not need skilled workers only skilled supervisors

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  62. jcuk (717 comments) says:

    DPF’s stance on this subject is another example of blind adherance to National and right wing thinking which is not always correct and misses the good ideas coming from the opposition. Nationals housing policy is obviously a bummer … unfortunately.

    Very similar to trickle down … creating a demand with no rational thought to how it will be met.

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  63. Southern Raider (1,831 comments) says:

    They are going to use prison gangs to do the pre fab work.

    Start spreading this to your average labour voter

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  64. burt (8,323 comments) says:

    Mike He

    You make good points about bypassing local suppliers to reduce the build cost. Problem… Puts locals out of work… Buy NZ made and all that. Labour in the kowtowing to the unions are planning to reopen Hillside in Dunedin. Apparently saving millions on trains but buying them off shore isn’t acceptable and we’re going to pour tax payers money into building a more expensive product here.

    Do you honestly think at local prices, with builders in strongly unionised working for a state monopoly building organisation can build 2 bedroom homes in Auckland using local products for $360,000 ?

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  65. Joseph Carpenter (214 comments) says:

    Kevin H is onto it, however the real problem isn’t the cost of the building – it’s the land. Take the Hobsonville “affordable” houses which were actually 2-storey mass produced same design terrace type housing using special “multiproof” consents – they were on tiny 200-220sqm sections which required special planning zone rules even to be allowed and they cost approx $300-320k just for the section. So even if they saved $36K evil developers margin per section (which he pulled out of his arse) you’re still looking at ~$275k just for the land -and that’s for a tiny section in a insta-ghetto out at Hobsonville with the original subdivision land acquired at super discount price. And that section price will have to include ~$40k for the ACC Development Contribution – surely they agreed with Len B he would be happy to forgo that juicy revenue stream ($92 million last year) and ACC will build the infrastructure for free, right?

    Can’t say I was impressed with National’s housing policy announcement but compared to this steaming pile it’s clear which is the lesser of two evils.

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  66. wreck1080 (3,972 comments) says:

    360k is still very expensive and unaffordable to those on an average wage.

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  67. backster (2,185 comments) says:

    Before starting on these $360k homes Labour will ensure that the builders are being paid a Living Wage.

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