In one of the first moves of the new Government, today Prime Minister Jacinda Ardern announced at her first Cabinet meeting press conference that foreign speculators would be banned from buying houses in New Zealand from early 2018. The announcement makes good on a promise made during the election campaign to restrict who could buy New Zealand housing, in an effort to cool the market.
This is a promise that has the support of New Zealand First, whose policy platform has long advocated blocking anyone who is not a permanent resident or citizen from buying N.Z. housing.
But the announcement, not surprisingly, has not gone down well with National, whose Finance Spokesperson Steven Joyce said that the announcement itself does not suggest a ban. Mr Joyce questioned whether houses classified as sensitive under the Overseas Investment Act are banned or not. Mr Joyce also questioned whether it would send the wrong signals to overseas investors about investing in New Zealand.
Mr Joyce misses the point. This is as much about social well being and a basic human right, but also the common responsibility of a Government to put the needs of it country and its people first, as it is about the markets, trade or economics in general. This is about addressing the fact that New Zealanders were being priced out of the market by foreign buyers with more spending power.
Ms Ardern indicated that she expects the legislation to be introduced to Parliament before Christmas, to be passed in 2018. She denied it would impact on the New Zealand-South Korea trade agreement or that it would affect the Trans Pacific Partnership Agreement. The latter of which is contentious with Labour allies, New Zealand First and the Greens, both of whom wish to see it abolished completely or NEw Zealand withdrawn.
I welcome this announcement. It is a major step in the right direction for New Zealand housing and the right of New Zealanders to own houses. It is also hopefully the start of a plan to address the disgusting fact that New Zealand has the highest rate of homelessness in the O.E.C.D. National had nine years to address this and other issues brought about by an out of control housing market, and failed to.