Newshub can reveal KiwiBuild has just become a much better investment.
The Housing Minister has quietly softened up the penalties applied to buyers who flip their home.
Documents obtained by Newshub show owners will no longer have to give up all capital gain they make on the house if they sell it within three years. …
Phil Twyford has secretly backed down on penalties for KiwiBuild buyers who sell up.
When Labour announced the policy in 2016, its plan to stop buyers reaping windfall gains was they must not on-sell their home for five years – or else they had to hand all the money they made to the Government.
That’s now changed to if buyers sell within three years, they must give up 30 percent of their profit.
This is heaven for wealthy families. They now don’t even have to move into the Kiwibuild house for a few years. They enter the lottery, win the house, and sell it the next day for a huge profit – keeping 70% of it.
Here’s how it works. Alan and Amanda have an 18 year old son called Andrew. Alan and Amanda are very well off, earning say $500,000 a year between them.
Andrew works part-time while studying. His parents tell him to enter the ballot, as they will finance the house if he wins. Andrew enters the ballot and wins a Kiwibuild house in Auckland for $650,000. His parents arrange the money and he buys the house.
The next day he sells his house for $800,000. Andrew and his parents get $150,000 profit. They keep 70% of it and so that is $105,000 for winning the taxpayer subsidized lottery.
Andrew continues to live at home with his parents but they now have $105,000 in the bank. Andrew goes off to London after he graduates very grateful to the stupid taxpayers.