New Zealand Economy

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Former BoE chief economist backs RBNZ bank capital hike

By Leith van Onselen The Reserve Bank of New Zealand’s (RBNZ) proposal to impose higher capital requirements on the local arms of Australian banks has been defended by John Vickers, the Bank of England’s former chief economist. He argues that the public benefit of safer banks outweighs any risks associated with such a move. Vickers

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As migrants flood Auckland and Sydney, locals are forced out

By Leith van Onselen Auckland and Sydney have much in common. Both are the largest cities in their respective nations. Both are harbour cities. Both have ridiculously expensive housing, with median dwelling values that hover near the $1 million mark. And both are the international gateways to New Zealand and Australia, and thereby attract the

6

RBNZ Governor destroys banking lobby rentiers (plus APRA and RBA)

By Leith van Onselen At a press conference yesterday, RBNZ Governor, Adrian Orr, publicly lashed the New Zealand Bankers’ Association (NZBA) for claiming that taxpayers should bail the sector out in the event of a crisis, and has used these comments as justification for the RBNZ’s capital reforms. From Interest.co.nz: Orr was answering a question about

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NZ to announce world’s first ‘wellbeing’ Budget

By Leith van Onselen New Zealand’s Labour-led coalition government will tomorrow release the world’s first ‘wellbeing budget’, which will measure its success against how it does socially, culturally and environmentally, rather than relying on GDP – a rather useless measure that most economists and policy makers focus on. From SBS News: “Nobody wants to live

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RBNZ: “imperative” Australia’s banks lift capital levels

By Leith van Onselen The Reserve Bank of New Zealand (RBNZ) has released its latest Financial Stability Report (FSR), which explained why banks need to hold more capital: Domestically, debt levels are high in the household and dairy sectors, leaving borrowers and lenders exposed to unanticipated events. Similar challenges exist globally, given current high public

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Fake news: NZ suffering post-immigration business crunch

Via the AFR today: New Zealand pub owner Chris Dickson worries his staff is overworked. He expected employment visas for two new overseas workers to be approved weeks ago, but the paperwork was delayed with no clear reason given. …”We are struggling to find people,” Dickson said. “It’s an epidemic.” …A plunge in net immigration

5

NZ house prices rise as volumes crash

By Leith van Onselen The REINZ has released its house price data for April, which revealed a 1.9% seasonally adjusted rise in the national median house price, with prices up just 6.3% year-on-year: Outside of Auckland, seasonally adjusted house prices rose by 1.4% in April, with prices up 7.5% year-on-year. Looking at the major cities,

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Jacinda Ardern breaks key election pledge to cut immigration

By Leith van Onselen In the September 2017 general election, the New Zealand Labour Party launched a plan to reduce immigration by around a third in a bid to relieve chronic housing and infrastructure pressures (especially around Auckland): …in recent years our population has been growing rapidly as record numbers of migrants arrive here. This

12

Foreigners desert NZ housing market

By Leith van Onselen Statistics New Zealand has released new data on non-resident purchases of New Zealand homes, which reveals that demand has collapsed: Home transfers to people who didn’t hold New Zealand citizenship or a resident visa fell over 80 percent in the March 2019 quarter compared with the same quarter a year ago, Stats

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Jacinda Ardern breaks key election promise to cut immigration

By Leith van Onselen In the September 2017 general election, the New Zealand Labour Party launched a plan to reduce immigration by around a third in a bid to relieve chronic housing and infrastructure pressures (especially around Auckland): …in recent years our population has been growing rapidly as record numbers of migrants arrive here. This

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NZ’s housing minister talks the talk, but will he walk the walk?

By Leith van Onselen In the lead-up to, and directly following, the September 2017 New Zealand general election, I heavily praised Labour’s housing spokesman, Phil Twyford, for promising to address both supply and demand distortions via negative gearing reform, banning foreign buyers of existing homes, tighter capital gains taxes, removal of urban growth boundaries, plus

24

NZ immigration rebounds

By Leith van Onselen After Statistics New Zealand in January changed the way that it measures net overseas migration (NOM), resulting in large falls in the estimated migrant intake, it has released migration estimates for January 2019, which reveals that NOM is rebounding: According to Statistics NZ: Migrant arrivals were provisionally estimated at 151,600 (±

10

NZ house prices rise as volumes crash

By Leith van Onselen The REINZ has released its house price data for February, which revealed a 0.8% seasonally adjusted rise in the national median house price, with prices up just 5.5% year-on-year: Outside of Auckland, seasonally adjusted house prices rose by 1.3% in February, with prices up 8.8% year-on-year. Looking at the major cities,

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Kiwibuild turns epic ‘Kiwibust’ for Jacinda Adern

By Leith van Onselen I’ve noted previously how the New Zealand Labour Party’s promise to “build 100,000 affordable homes across the country” is shaping up as an epic failure due to: the government changing the program from “building” to “facilitating” the delivery of 100,000 affordable dwellings, meaning that NZ taxpayers would merely ‘underwrite’ many dwellings that would have been

16

NZ mulls land bankers’ tax

By Leith van Onselen New Zealand’s Tax Working Group (TWG) – an 11-member group chaired by former Labour Finance Minister Michael Cullen – has delivered its final report, which recommends creating a local government tax on vacant residential land in a bid to stop land banking. From Interest.co.nz: The Tax Working Group (TWG) is recommending a new tax on vacant

5

Auckland house prices continue to fall

By Leith van Onselen The REINZ has released its house price data for January, which revealed a 2.9% seasonally adjusted rise in the national median house price, with prices up just 5.2% year-on-year: Outside of Auckland, seasonally adjusted house prices rose by 2.3% in December, with prices up 9.7% year-on-year. Looking at the major cities,

2

NZ immigration continues to retrace

By Leith van Onselen After Statistics New Zealand last month changed the way that it measures net overseas migration (NOM), resulting in large falls in the estimated migrant intake, it has released migration estimates for the 2018 calendar year, which reveals that NOM fell further to 48,278 people, down from a peak of 62,227 in

10

Is Australia’s housing bust spreading to New Zealand?

By Leith van Onselen The property downturn appears to be spreading into New Zealand, with the latest valuation data from Quotable Value revealing that average residential property values in Auckland were almost 1% lower year-on-year in January, whereas the rate of price growth has also declined sharply across the rest of New Zealand: The latest RBNZ Survey

8

NZ unemployment jump whacks Australian dollar again

NZ Stats surprised with rising unemployment this morning versus expected flat: Unemployment rate rose to 4.3 percent Underutilisation rate rose to 12.1 percent Employment rate fell to 67.8 percent Filled jobs rose 1.3 percent Average ordinary time hourly earnings rose to $31.63 Wage rates increased 1.9 percent annually. The NZD took a pounding dragging the

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Ardern’s Kiwibuild turns epic ‘Kiwibust’

By Leith van Onselen I’ve noted previously how the New Zealand Labour Party’s promise to “build 100,000 affordable homes across the country” is shaping up as an epic failure due to: the government changing the program from “building” to “facilitating” the delivery of 100,000 affordable dwellings, meaning that NZ taxpayers would merely ‘underwrite’ many dwellings that would have been

38

Statistics NZ dramatically lowers immigration estimate

By Leith van Onselen “Look mum, I’ve got a new ruler”. Statistics New Zealand has revised the way that it measures net overseas migration (NOM). Instead of using departure cards that people filled out when leaving the country, Statistics New Zealand now uses an “outcomes-based measure”, which it claims is more efficient and accurate. This