Gareth Kiernan from Infometrics writes:
The long-awaited reset of KiwiBuild confirms that the Government still doesn’t grasp why the policy went so spectacularly wrong.
Which is surprising as they were told almost non stop for seven years it wouldn’t work, and why.
KiwiBuild remains a policy that has been formulated to treat the symptoms of a problem that the Government has failed to properly diagnose or understand.
And it seems they still don’t.
But if the rate of construction is not the problem, yesterday’s announcement shows that the Government still hasn’t got any ideas to make a meaningful difference to housing affordability. The announcement features sticking-plaster solutions: A rent-to-buy scheme, a possible shared equity arrangement, and reduced deposit requirements under the renamed “First Home Loan” and “First Home Grant” policies.
These policies hint at one of the biggest hurdles for people trying to buy a home: Accumulating a deposit. For a few people, the changes will make homeownership more achievable. But they do nothing to address the fundamental question of why housing has become so expensive.
The reality is that the limited supply of land available for new development or intensification is not keeping pace with demand and is pricing people out of the market.
Yep. Cities need to build up and build out. Instead the Government is passing laws or statements making it harder to build out, claiming our 1% urbanisation rate is threatening rural NZ.