Polity: House-buying patterns in Auckland
506 Responses
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nzlemming, in reply to
Well, my point is that when you want to make it clear that good analysis is virtually impossible, maybe doing the best you can and everyone seeing just how weak it really is isn’t a bad way of showing that better data should be kept.
When you want to make such a thing clear, then that is what you say. You don't say "our analysis shows that Chinese buyers are buying out of proportion to their population, therefore they are non-resident and thus the problem" - that is so what you don't do if you have any moral integrity and respect for facts, as well as for the people you are targeting. That is, however, what Labour chose not to do. I doubt they could have managed it worse if they'd got Farrar and Slater to write the release.
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BenWilson, in reply to
But what they have done is made it more unlikely that the Government will collect proper data, because now they can yell “race card” instead.
We'll see. At this point, it could be race card or it could be actually true. Which one do you think most National supporters think it is? We're talking about the demographic I personally most regularly hear groaning about all the Chinese buying up their investment properties. The other one I hear it from is Labour supporters. That's the bit that's scary about this. If your official policy is to refuse decent information, then you do rather leave yourself vulnerable to decent misinformation.
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Danielle, in reply to
But to do nothing in the face of the Government’s refusal to collect proper data .. is that what you see as a more appropriate response to the Auckland affordability crisis?
But it's not an either-or! "Instead of doing nothing, we should do the only other thing available: a racebaity thing!" I refuse to believe that those were Labour's only options.
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BenWilson, in reply to
You don’t say “our analysis shows that Chinese buyers are buying out of proportion to their population, therefore they are non-resident and thus the problem” – that is so what you don’t do if you have any moral integrity and respect for facts
I don’t really follow. That actually looks like it could be a fact. As close as we’ve got to one, anyway.
ETA: I guess I should ask my other question again. We can argue till we're blue about what Labour shouldn't have done. But what do you think they should have done regarding this issue that is, after all, a pretty big part of the current public mood? Just thrown up hands in despair at the lack of information and let National get a free pass?
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Katharine Moody, in reply to
I think your wrong on that. I think the Government will be forced to collect data. The opposition in Parliament is driving the agenda these days. Look at zero-hour contracts. Under pressure from opposition parties and the union movement - Woodhouse first said he'd outlaw zero hours. Sure, now they are wiggling around on that commitment - but even the Chamber of Commerce guy on telly this morning criticized them for that (and for their stance on work safety amendments). The tide is turning - thanks to the opposition finally becoming more effective.
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talkie_toaster, in reply to
Don't worry. Since you are the second person to call me a "troll" without any attempt to discuss or address my points, and one of the many people who've revealed that you're not really statistically literate, I'll definitely fade away. There's really no point. You got me: I give up. Clearly, this is not a blog that welcomes new ideas or discussion points. This is clear.
So, you can all go back to your heartfelt discussions of identity politics and how any analysis that uses race is racist and feel self-satisfied and smug and happy in the knowledge that even while the Labour party is losing over and over again, at least you're losing in a way that can't possibly be construed as racist. In other words, you'll continue to do the National Party's job for them. by uncritically accepting their framing of events, and not even backing your own goddamn ministers when they use entirely uncontroversial statistical techniques to make entirely uncontroversial statements that everybody here secretly agrees are actually true (Chinese money is flooding the Auckland property market).
It's a shame though, because this country is genuinely going to crap while you're engaged with your self-satisfied navel-gazing and I'd really like a genuine opposition that actually talks about things that non-political non-academic normal kiwis give a shit about and does so in an unapologetic manner.
Not particularly confident that this will happen, so I guess I'll go back to the Greens, who at least know what they stand for. G'night!
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nzlemming, in reply to
Any other ideas on how to find the numbers would be cool
You could do it, relatively easily, by using the data I suggested from various agencies and cross-referencing it to eliminate residents. That would require changes to legislation and I would be very circumspect about letting National change the privacy aspects of the Revenue Act or the Privacy Act - be careful what you wish for.
Or, you could require property purchasers to declare residency status, set up an information trail via LINZ to the Overseas Investment Office who would compile a register of non-resident purchasers (might need some tweaking of the Overseas Investment Act and Regulations) which would be a metric shit-load simpler.
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nzlemming, in reply to
It’s irresponsible of National to make it impossible to even have a debate about this based on more sensible facts.
I literally choked on my tea when I read this. This is the National Government you're talking about.
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Katharine Moody, in reply to
nzlemming - you need to be the Government to do either of those two things!
What could the parties in opposition do - right now - to find the numbers?
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nzlemming, in reply to
That’s the bit that’s scary about this. If your official policy is to refuse decent information, then you do rather leave yourself vulnerable to decent misinformation
National don't care. If you haven't learned this fact thus far, we must not be reading the same media.
THEY DON'T CARE:
- about facts
- about evidence-based decision making
- about reasoned analysis or criticism
- about transparency
- about actually having a meaningful discussion about anything.They prefer other people spouting misinformation because then they can be all-wise and say "if you knew what we know, you'd understand why you're wrong" without any intention of ever sharing the information. They're happy to have people spouting misinformation because then they can call them on it without having to reveal anything, most of all, that they don't have the information themselves.
Disabuse yourself of any belief that the Key government (besides whom the Bolger government is like unto a pane of glass) has any intention of revealing anything if it can make their opponents wriggle on a hook of their own making.
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nzlemming, in reply to
What could the parties in opposition do – right now – to find the numbers?
They can’t. It’s really that simple. The mechanisms are not in place.
[edit] and if you can't find the real information, that should be the point of your release, not to say some "leaked information" shows something to be the case when it's a partial subset of one vendor's customer set. For every leak, someone had a motive for leaking it. If you don't know what the motive was, you don't run with it unless you can confirm it from a secondary source. Journalism and Politics 101. Both the Herald and Labour have forgotten this.
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Danielle, in reply to
That was a bloody long flounce. Could have done with some judicious editing, I reckon.
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nzlemming, in reply to
I think your wrong on that. I think the Government will be forced to collect data.
We'll have to see. I doubt it, though.
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nzlemming, in reply to
That was a bloody long flounce. Could have done with some judicious editing, I reckon.
As long as it's permanent. He's already on my "nothing to see, scroll along" list.
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BenWilson, in reply to
I literally choked on my tea when I read this. This is the National Government you’re talking about.
LOL, well, true. I forgot their free pass to be irresponsible, which Labour has to pay good votes for. I didn't expect to have to be the one stamping it, though.
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I'm 'with' the toaster. While you might not agree with them, they've made made some points but the PA regulars are pumped up on something and have the gloves on. KO.
Play the ball not the 'man'.
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Danielle, in reply to
Which points? The consistent misrepresentation of everyone else's nuanced arguments about data analysis, non-resident property speculation and racism? That great moment when he said "so what?" to Tim feeling othered in his own country? Um, OK.
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BenWilson, in reply to
My feeling is that we have a public already predisposed to believe the analysis. Just denying it won't be good enough. And I would include most of the local ethnic Chinese I know in that. They're at least as likely to groan about all the foreign Chinese driving up prices as anyone else.
Also, just because I dislike National doesn't mean I think Labour has got some moral high ground, some onus to give only the purest academic grade research every time they crank out an opportunistic statistic. It's not going to get my vote, but they'd be having to work pretty hard on that anyway.
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nzlemming, in reply to
I dislike bullshit opportunism by any party. I'm not and never have been a member of any political party, though I was a union rep in an earlier life. You may be right about the predisposition but that doesn't mean we should give Labour a pass for pandering to it. I'll settle for a morally higher ground than National, which doesn't take much doing and so is all the more miserable when they fail.
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Kumara Republic, in reply to
Also, just because I dislike National doesn’t mean I think Labour has got some moral high ground, some onus to give only the purest academic grade research every time they crank out an opportunistic statistic. It’s not going to get my vote, but they’d be having to work pretty hard on that anyway.
Thankfully we have a political system that allows 3rd parties to get a foot in the door.
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linger, in reply to
TT had, I think, an entirely valid point in (repeatedly) insisting that the racist framing of the issue came from media reports rather than from the wording or interpretation used in the original analysis. This whole snafu really seems much less a matter of “OMG I can’t believe Labour used a racist dogwhistle, WTF were they thinking!?” and more a matter of “OMG Labour totally stuffed up their media strategy yet again” – as a result of which it got turned into a racist dogwhistle.
Labour really have been tone-deaf and clueless enough in their dealings with the media over the past few years that I’m perfectly willing to believe it’s (another) cock-up rather than a conspiracy. -
simon g, in reply to
I guess I'll go back to the Greens, who at least know what they stand for.
Yes they do. Fortunately it's the very same view you've been dismissing:
Green Party co-leader Metiria Turei said while Labour's information was interesting, its housing spokesperson, Phil Twyford, was making massive assumptions about people's identities.
"You can't use those stats he's got to make the claims he's making," said Ms Turei. "It's a pretty crude piece of racial profiling." (Radio NZ)
That's pretty clear, unless you're determined not to see it.
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David Hood, in reply to
It’s just as plausible that the problem is too many people watching Homes Under The Hammer on the Living Channel and deciding to build a property portfolio for their retirement
I can rule that one out- there has been no change in household savings in other forms of wealth or incomes sufficient to account for the rise in house prices.
I can tell people exactly what happens if you just talk numbers. You tell people that if you add up the amount of money in mortgages, and the value of NZ housing, it was a rock solid predictable relationship up until 2001/02 then began to diverge in 2001/2002 and that the mystery money cannot be accounted from other sources within the NZ economy (for example household wealth in other forms has not altered, incomes haven't altered, etc). (attached graph)
Then they go "yes, it is a mystery", or rather most of the time "I don't understand". At which point you can't actually say much more as there is no positive evidence of where the mystery money is coming from*, only negative evidence from inside NZ for where it isn't. And the conversation dies as too abstract.
Then you go away and look at other housing markets and establish that in Ireland household debt did go up because Irish people were buying the houses
https://www.dropbox.com/s/gpuhxvs4apfhz7s/bubbles.pdf?dl=0
Then people say "yes, but Ireland was different" so you get the figures for the United States as well, and find that U.S. debt again increased with house prices as local people were buying the houses. Figures at https://sites.google.com/a/thoughtful.net.nz/home/international-house-bubbles
You try and find figures for Australia but their housing market records are even murkier than New Zealands.
At which point those few people still with you go "It is strange isn't it, huh" at which point, because it is clear that the argument is way to technical to get any traction and you have satisfied your own curiosity about the matter, you get on with your own life.
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BNZ economist Tony Alexander weighs in:
Firstly, good on someone for trying to throw more light on an issue which I have highlighted in the past with a recommendation that we adopt Australia’s rules of banning sales of existing houses to foreigners. See for instance my last BNZ-REINZ Residential Market Survey from March 2014. I do not fault Labour’s Housing Spokesman Phil Twyford for releasing the data. But as with my own efforts to estimate offshore buying last year and in 2013 the data simply do not allow us yet to truly know what proportion of our housing stock is being sold to people who will never live here - be they Chinese, Albanian or whatever.
The real estate agency data released this week suffer a huge flaw in that one cannot identify whether the person with the Chinese name is in fact located offshore having no intention of living in New Zealand. Their family could have been in New Zealand since the Otago gold rush days of the 1860s. They might have migrated here in the wave from the late-1980s when we changed our migration rules to specifically reduce emphasis on English heritage and open the door instead to people based on measures of merit, regardless of where they were coming from.
And:
1. The fundamental cause of rising prices in Auckland is a shortage
of supply and until that gets addressed prices will stay highly elevated and perhaps keep rising out to late-2017 this cycle.2. Whatever the true magnitude of Chinese buying has been these past few years it will get much greater. Chinese families are growing wealthier, so naturally they will seek offshore assets. Chinese people wish to get assets off the mainland and this week’s massive intervention in sharemarkets by the Beijing authorities illustrates why people have high distrust of the environment on the mainland in which they would hold assets. And Chinese authorities have yet to relax hefty restrictions on people getting their funds offshore. When they do, well then you will see something entirely new hit the world’s residential property markets.
3. We should as soon as possible adopt Australia’s rules restricting foreign buying of anything other than new housing unless resident for 12 months.
But here is the fourth point which to date I have not emphasised but now will do. Adopting Australia’s rules as they stand won’t be the panacea many are hoping for. In Australia’s case people have been able to get around the restrictions quite easily. The regime is now being enforced more rigorously, but that does not necessarily alter what is being seen as a huge problem – something which people in Hong Kong have been seeing more and more of in recent years.
Many Chinese who buy properties never, or rarely, occupy them. They sit empty. This applies even to newly built apartments sold to Chinese buyers. Chinese simply want an asset away from any control by the CCP.
There was an article on this in The Australian newspaper this weekend, page 6. What this means is the following. As Auckland very slowly goes vertical in areas like New Lynn, developers will find they can very easily get offshore financing for their projects and hefty sales off the plan to Chinese investors (we Kiwis prefer to touch and feel before buying). These investors may never occupy or even rent out their investment. Thus while on the face of it the Aussie rule that a foreigner may only buy a newly built house or apartment sounds like a grand idea, it could leave the housing supply situation unchanged from a no-rule regime.
Thus, were we to adopt the Aussie regime we would need to add in an extra clause along the lines of apartments having to be made available for rent, actually rented, or something like that.
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The fundamental cause of rising prices in Auckland is a shortage of supply
Don't believe this.
If you have a market with a shortage, like out of season aubergines, the price rises until there's an equilibrium of buyers and sellers and then stabilises.
If you have a bubble, like tulips in 1637, the price is entirely driven by an expectation of future gains. There is no equilibrium, because any increase in price is taken as an indication that prices (and hence profits for the asset holder) will continue rising.
Auckland property is a bubble, not a market.
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