Saturday, December 8, 2018

KIWIBUILD UNRAVELLING AT THE SEAMS

The CoL's flagship policy is unravelling at the seams.   Hot on the heels of Twyford's decision by fiat to allow owners of Kiwibuilt homes to flick their property within three years and keep 70% of the profit (sheesh ... the original deal was based on the meme that if you were lucky enough to be drawn from the ballot you would appreciate the Government’s help in getting you into a first home  and you accepted a restriction on being able to flip it, or flick it) comes the revelation that the CEO of Kiwibuild has resigned after only six months in the job ... we have to ask why ... the answers.  

The CoL has saddled the taxpayer with 


• A housing scheme that is undercapitalised.   The Treasury’s assessment.

• A housing scheme that won’t contribute anywhere near what the Government said it would to the market.  The assessment of the Treasury and the Reserve Bank.

• A housing scheme that isn’t even close to getting people locked out of the market into a home, given the prices.

• A housing scheme in parts of the country that’s actually more expensive than the open market prices already in play.

• A housing scheme that doesn’t actually have any real demand, given they extended the ballot in places like Wanaka.

• A housing scheme with some homes in Auckland now on the open market, due to the fact the people who won the ballot didn’t want the property, and the runners up didn’t either.

• A housing scheme that is unilaterally being fiddled with, with our money, by a bloke whose head is so big it can’t get through a door.

• And now, a housing scheme that because they changed the rules unilaterally, now needs a dedicated team to monitor who is selling their houses for the profit they’re allowed to keep due to the changes of rules, and that team costs upwards of half a million dollars a year.

Kiwibuild is unravelling by the day and the Government is stuck with it because it's all theirs with nobody else to blame.
 

 

10 comments:

pdm said...

If Rachel Smalley is sitting in the CEO's seat, even if only temporarily, then there will be more problems to come that is for sure..

alloy said...

This is a result of 9 long years of policy neglect.

If they can't get this right, imagine how bad their policies developed since the election will be.... oh right.....

Psycho Milt said...

Even if this aspect of Labour's housing policy were as crap as you claim it is, it would still be a long way ahead of the previous government's policy of denying there was a housing crisis while blaming the not-a-crisis on local government.

alloy said...

PM, Labour policy might be slightly ahead if it had actually added to the national housing stock.

It hasn't.

The Veteran said...

PM ... ones senses that your response is somewhat defensive. You may care to tell us how this emerging clusterf**k addresses the housing crisis so called when the first recipients were a 'yuppie' couple knocking on the door of a combined income in the order of $250ki per annum.

That's the problem when you design a policy consisting of sound bites but not much in between.

Anonymous said...

Veteran.....ten years of turning a national asset into a wealth creating vehicle for the few. Houses are homes not the bottom line on a balance sheet.

It well within the Govts remit to introduce rent caps and tighten rental regulations in line with the more developed countries in order to make housing more affordable. Vast swaths of rental houses are owned by overseas interests, our banks are Australian owned, almost all the big realtors are also Australian owned, it is a property wild west out there only equalled by Toronto......Sydney is undergoing a "correction".

Chucking your national housing stock onto the roulette table of the "free market" was never going to work.

Lord Egbut

Adolf Fiinkensein said...

Legbut has an elephant in his room.

There is no such thing as unaffordable housing. There is, however, unaffordable land resulting from artificial land shortages created by city and town councils.

Instead of all his bullshit socialist regulations which don't work anywhere in the world, all he needs to do is bash a few heads together in the councils.

Anonymous said...

Houses have become the bottom line on a balance sheet. An overvalued one. A great percentage of the 'value' is the fairy dust regulatory and consent costs that an owner has paid. Councils behave like corporations, the more they can clip the ticket the more 'successful' they are. The RMA is a rort and both National and Labour have enabled the rort. Key had the opportunity with his majority to change that, but he had the guts of a rabbit. The present government has the brains of a rabbit and the mouth of a magpie.

Mick

The Veteran said...

Egbut ... all rent caps do is to encourage good landlords to exit the market. The rental market is skewered enough in favour of the tenant and bad tenants can get away with murder.

I agree with Mick ... National had the opportunity to fix the RMA but it was a very small window of opportunity that closed with the resignation of Mike Sabin. Even then I doubt whether Key would have gone ahead given the Maori Party's opposition to RMA reform.

It certainly ain't gonna happen with the CoL in government. Perhaps, just perhaps, if sanity prevails at the next election and National is returned to office and third parties are consigned to the dustbin of history things might change.

But, one thing for sure ... if Kiwibuild was the answer then it must have been a stupid question.

Anonymous said...

Veteran.....precisely, it causes all the part time landlords and those who see it as an easy buck to exit the market leaving it to the registered professionals who by law employ their own maintenance people ....

I will show you my example if you will show me yours......
https://www.thelocal.fr/20180719/rent-prices-in-paris-soar-in-six-months-since-rent-caps-binned

This from 2016....before the court decision
https://www.citylab.com/equity/2016/08/paris-rent-control-laws-are-working/494282/

Bad tenants are almost unknown in France due to the social services being linked by computer with local authorities and all registered landlords, the use of ID cards means that if you fuck up you really will be on the streets.

It also means that demand for property as means of wealth creation is lowered meaning affordable housing.... like this......

https://www.green-acres.fr/en/properties/12862a-12568-g1004.htm
https://www.green-acres.fr/en/properties/12862a-12568-g1011.htm

Lord Egbut