Better to stimulate housing supply than demand

Chris Bishop released:

The coalition Government is investing in social housing for New Zealanders who are most in need of a warm dry home, Housing Minister Chris Bishop says.

Budget 2024 will allocate $140 million in new funding for 1,500 new social housing places to be provided by Community Housing Providers (CHPs), not Kāinga Ora, thanks to savings found by ending the First Home Grant.

The First Home Grant subsidises buyers, and hence increased demand. This in turn will increase prices.

On the other hand, increasing the supply of houses will reduce pressure on house prices.

So a much better policy.

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