I truly believe the cost of housing is a supply issue. The land my house is on is worth more than the house itself, and it's not even close. Something like 10:1 value of land to value of house.

And land has almost no intrinsic value. It's value comes from it's scarcity, and in NZ it's scarcity comes from zoning and housing limits, we have plenty of land.

The government used to build houses in huge numbers, across the country you can find whole suburbs of old state housing that was eventually sold off. I'd love to see us get in and do that again, which the previous government had started on to some extent, but the new government will not be interested in continuing it.

[–] absGeekNZ 5 points 9 months ago (1 children)

It is almost 100% a supply issue.

There are a lot of things that cause this issue, the crazy high cost of building, zoning and NIMBYism, the cultural insistence on single level homes with a yard....

I say this, when I live in Taupo and have a house with a yard.

A few years back, I lived in a small place that had a very small patch of grass somewhat less than 20m^2 (less than 5 x 4), I had an electric mower to keep it down...it was stupid, I had to store a mower for this tiny patch of grass.

[–] Dave 5 points 9 months ago

I know someone who recently bought a new build with a triangle piece of grass about 1m wide and 2m long to the point of the triangle. Apparently the council required the developers to have some grass.

There are a lot of things that cause this issue, the crazy high cost of building, zoning and NIMBYism, the cultural insistence on single level homes with a yard…

I think the Kaianga Ora developments help with a lot of this. They are government so can fight councils and get laws changed if needed, and they are building medium density housing. From what I've seen, they are largely in areas with public transport access. And they don't have to care about whether the housing type is in demand, houses are houses.

Just a shame that the new govt has pledged to gut them.

[–] Venator 1 points 9 months ago* (last edited 9 months ago) (1 children)

https://youtu.be/DVvoyRpxG-A

Supply is only half the problem, the other half is the nearly bottomless pockets of the investor class that will always outbid everyone.

[–] Dave 2 points 9 months ago

That's the beauty of it. You solve the supply problem, then investors don't have an investment anymore. What are they gonna do, rent it out? You solved the supply problem, so now there are more houses than people to put in them.

If you have more houses than people willing to rent them, then landlords have to compete for tenants, pushing rent prices down - or landlords just end up selling properties they can't rent, pushing house prices down.

If more houses are for sale, there are more choices for people buying houses. Instead of competing to buy a house, vendors will be competing to sell their house. If you can keep the supply of new houses coming, so you always have a surplus, then now you can't make heaps of money renting houses and you can make it on capital gains, how do you make money in property?

(The answer is you lobby the government to let in heaps of migrants to fill up the housing, returning to a supply problem).