Little targets housing 'speculators'

UPDATED: National’s Steven Joyce says yesterday's policy announcement by Labour is “underwhelming.”

“They talked a very big game, saying ‘this was going to be a massive game changer,’ but they have basically endorsed the government's current housing policy,” he says.

Mr Joyce says the $2 billion Kiwibuild programme won’t build 100,000 houses – instead closer to just 4000.

“What [Labour] has basically done is endorsed a comprehensive plan that [the government] has produced except, if anything they, have been under-doing the supply side of the problem.”

He says Mr Little “hardly gave that a mention and that's actually the most important part.”

He brushed off Mr Little’s accusations that the government was “on the side of the [property] speculators.”

“To say we have been sitting on the sidelines and to come up with basically the same plan the government has done suggests they were all full of bluster, really.” 

EARLIER: The Labour party has blown out the candles at its 100-year anniversary party, with leader Andrew Little putting 100,000 new affordable homes on his wish list.

At the final day of Labour's conference, Mr Little made his third and final housing policy announcement, telling the party faithful Labour would spend $2 billion building 100,000 new homes within 10 years for first home buyers if elected.

His speech was dominated by talk of housing, calling out the government for siding with the housing speculators over first home buyers.

"New Zealanders don't have time for National to come up with a housing policy that works," Mr Little says.

Move on negative gearing
"[New Zealand's] rules around negative gearing encourage speculation," he says.

"The way this works is investors are able to write off any losses they make in property investment against the rest of their income for tax purposes. That means other taxpayers pick up the tab – it's effectively a taxpayer subsidy for speculation."

However, Mr Little stopped short of saying his party would abolish negative gearing, instead saying it would "consult" on the issue.

The Labour leader also reiterated his party's policy that foreign buyers would only be allowed into the market if they were building a new home.

And he promised to tighten rules around investment properties, saying "the government I lead will extend the bright line test so that if you sell an investment property within five years, you’ll pay the full tax on it."  Currently, those who sell within 18 months are potentially under the gun to pay tax.

Work with private sector
Labour would work with the private sector to develop the new houses.

"Working with the private sector and experts in fields like prefabrication, we can build standalone homes for $500,000-$600,000 in Auckland, with apartments and townhouses for less than $500,000."

"These homes won't be palaces, but they will be modern, warm, and affordable first homes."

As well as the new houses, he says Labour will be doing more to free up more land and will abolish the Auckland urban growth boundary that has been driving up the price of land, if elected.

"We’ll replace it with a smarter way to manage urban growth that will shut down the land bankers and speculators by cutting off their profits."

Affordable Housing Authority

Mr Little says Labour would also set up an Affordable Housing Authority to deliver ambitious new urban development projects which would lead and master-plan the building of new communities and the revitalisation of old ones.

The authority will have a target to meet: 50% across all of the homes in its developments will have to be affordable.

Mr Little's announcement follows a string of other housing-related policies.

Mr Little said on Thursday that, in government, Labour would provide 1400 extra accommodation places for the homeless.

It would come at a cost of $60 million to the taxpayer but Mr Little says it would be enough to put a roof over the heads of 5100 homeless people a year.

Yesterday, Labour promised to turn Housing NZ (HNZ) into a public services government department and use the dividends received - which are now paid to the Crown - to build new homes. Mr Little says this could see as many as 1000 new state homes a year.

This financial year, HNZ is expecting to pay a $188 million dividend to the Crown.

Former Labour cabinet minister and ACT Party leader Richard Prebble came out swinging against his former party this week, telling NBR Radio Labour has become “an anti-intellectual party.”

He was critical of its leader too, saying Mr Little is a “very unattractive leader.”

Political commentator Matthew Hooton was also been critical of Labour this week – telling NBR Radio the party is “fixated on its past and it seems to think that pleasing its extreme left-wing activist base and the union bosses in Wellington, with tales of nostalgia about Michael Joseph Savage and what was achieved in the 1930s, is the path forward for Labour.”

Labour's announcement follows National's commitment to a $1 billion infrastructure development fast-track fund for councils to help address housing supply issues, which Prime Minister unveiled last week.