New Zealand Economy

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NZ’s population surges towards 5 million

By Leith van Onselen Statistics New Zealand has released it’s June quarter population estimates, which shows that New Zealand’s population is fast approaching 5 million people, increasing by 92,000 (1.9%) over the past year to 4.89 million: As usual, this growth has been driven by mass immigration, which added 65,000 in the year to June:

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NZ Labour to ban foreign home buyers

By Leith van Onselen Later this week, New Zealand’s Labour-led coalition Government will introduce legislation to implement the first tranche of its demand-side housing reforms, amending the Overseas Investment Act to preclude foreign buyers from purchasing residential property. From The Canberra Times: Ms Ardern’s Labour Party is adamant that a law change banning foreigners from buying

10

RBNZ goes dovish as Kiwi plummets

by Chris Becker The Reserve Bank of New Zealand (RBNZ) held its monthly interest rate meeting this morning, holding rates again at 1.75%, but substantively changed the language around their key policy guidance. From the source: The Official Cash Rate (OCR) remains at 1.75 percent. We expect to keep the OCR at this level through

3

NZ unemployment rate rises to 4.5%

By Leith van Onselen Statistics New Zealand has released its labour force data for the June quarter, with the unemployment rate rising by 0.1% to 4.5%. Below are the key points from the release: Unemployment rate rose to 4.5 percent. Underutilisation rate rose to 12.0 percent. Employment rate was unchanged at 67.7 percent. Filled jobs

5

NZ Labour falls deeper into housing abyss

By Leith van Onselen New Zealand’s chronic housing shortage continues to worsen, especially in Auckland, despite dwelling consents rising to 15-year highs and immigration falling. There were 12,369 dwelling consents issued across Auckland in the year to June (up 19%), and 32,860 consents issued across New Zealand over the year (up 7.9%): However, despite the

5

NZ immigration eases as Aussie exodus ends

By Leith van Onselen Statistics New Zealand released its permanent & long-term migration figures for June 2018, which revealed that immigration into New Zealand has continued to drift back from record high levels, with 64,995 annual net permanent and long-term arrivals landing in New Zealand in the year to June, down from a peak of

10

ANZ: High house prices, immigration, a ‘productivity killer’

By Leith van Onselen ANZ’s latest Property Focus claims that claims that unaffordable housing and excessive immigration is killing productivity in New Zealand. From Interest.co.nz: “High house prices make it more difficult for younger households to invest in businesses, limiting the entrepreneurial endeavours of younger people. They also create barriers to labour mobility and social

12

Auckland house prices rebounded in June

By Leith van Onselen The REINZ has released its house price data for June, which revealed a 0.9% seasonally adjusted monthly rise in the national median house price, with prices also up 5.2% year-on-year: Outside of Auckland, seasonally adjusted house prices rose by 1.3% in June, with prices up 6.6% year-on-year. Looking at the major

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Has Ardern killed another key housing reform?

By Leith van Onselen Six years ago, I penned an article entitled Why developers land bank, which attempted to explain the drivers and motivations for land banking. Included in this article was the argument that land banking is more common in markets with regulatory barriers to land supply, such as urban growth boundaries (UGB), because

13

Ardern’s Kiwibuild turns from social housing to “socialism for the rich”

By Leith van Onselen I noted on Monday how the New Zealand Labour Party’s promise to “build 100,000 affordable homes across the country” was already 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

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Ardern’s Kiwibuild program descends further into farce

By Leith van Onselen I noted on Monday how the New Zealand Labour Party’s promise to “build 100,000 affordable homes across the country” was already 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

21

Ardern’s ‘Kiwibuild’ affordable housing policy already an epic fail

By Leith van Onselen As part of its election platform, the New Zealand Labour Party promised to “build 100,000 affordable homes across the country”: Labour’s KiwiBuild programme will build 100,000 high quality, affordable homes over 10 years, with 50% of them in Auckland. Standalone houses in Auckland will cost $500,000 to $600,000, with apartments and townhouses under $500,000.

9

NZ Labour falls further into housing abyss

By Leith van Onselen New Zealand’s chronic housing shortage continues to worsen, especially in Auckland, despite dwelling consents rising to 15-year highs and immigration falling. There were 12,274 dwelling consents issued across Auckland in the year to May (up 18%), and 32,628 consents issued across New Zealand over the year (up 6.5%):   However, despite

1

Auckland house prices continue to drift lower

By Leith van Onselen The REINZ has released its house price data for May, which revealed a 1.1% seasonally adjusted monthly rise in the national median house price, with prices also up 4.5% year-on-year: Outside of Auckland, seasonally adjusted house prices fell by 0.3% in May, with prices up 5.3% year-on-year. Looking at the major

23

NZ Labour sinks into immigration lies

By Leith van Onselen In the lead-up to last year’s September general election, 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): Last weekend, the Labour-led Government announced that it would triple the amount of time that

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Foreign buyers gobble 7.3% of Auckland homes

By Leith van Onselen Statistics New Zealand has commenced collecting data on non-resident purchases of New Zealand homes, and the results are interesting: In the March 2018 quarter, just over 3 percent of home transfers were to people who didn’t hold New Zealand citizenship or resident visas, Stats NZ said today… Nearly 33,000 homes were

21

Politicians only care about housing in opposition

By Leith van Onselen Back in 2007, then National opposition leader, John Key, lamented the woeful housing affordability in New Zealand (Auckland in particular), and promised to undertake a wide range of supply-side reforms if elected into government. John Key was elected as Prime Minister in November 2008 and the National Government ruled until September

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Liar Jacinda Ardern opens immigration flood gates

By Leith van Onselen In the lead-up to last year’s September general election, I praised New Zealand Labour’s plan to reduce immigration by around a third, because it would help to relieve chronic housing and infrastructure pressures (especially around Auckland): Back in March, we experienced the first hint of backsliding from Labour, with Immigration Minister, Ian

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RBNZ Governor backs sub-prime lending

By Leith van Onselen The new governor of the Reserve Bank of New Zealand (RBNZ), Adrian Orr, gave a bizarre interview on Newshub Nation over the weekend, whereby he simultaneously fretted over New Zealand’s excessive household debt while at the same time argued against loan-to-value ratio (LVR) limits for low income ‘Kiwi build’ borrowers. First, below

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NZ mortage growth rebounds as investors stir

By Leith van Onselen The RBNZ’s latest mortgage data shows that household and mortgage credit growth has begun to rise again after cooling recently in response to loan-to-value ratio restrictions targeting investors. After bottoming in February at 5.7%, annual New Zealand household credit growth rose to 5.8% in April: Most of New Zealand’s household debt

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Despite immigration fall, NZ housing shortage worsens

By Leith van Onselen New Zealand’s chronic housing shortage continues to worsen, especially in Auckland, despite dwelling consents rising and immigration falling. There were 11,629 dwelling consents issued across Auckland in the year to April (up 14%), and 32,015 consents issued across New Zealand over the year (up 5.4%): Despite the pick-up, none of this

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RBNZ to maintain LVR restrictions

By Leith van Onselen The Reserve Bank of New Zealand’s (RBNZ) officially introduced loan-to-value ratio (LVR) restrictions targeting investors on 1 October 2016, although banks began informally applying the rules since they were first announced in mid-July 2016. The latest mortgage data shows that household and mortgage credit growth has cooled significantly in New Zealand

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Anatomy of an Auckland housing disaster

By Leith van Onselen You know Auckland’s housing market has hit peak stupid when despite a near record high average dwelling price of $1.05 million: And rampaging population growth: We are being told that Auckland’s dwelling values must continue to rise otherwise developers will go bust: House prices and those of commercial property projects will

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NZ immigration eases with end of Aussie exodus

By Leith van Onselen Statistics New Zealand released its permanent & long-term migration figures for April 2018, which revealed that immigration into New Zealand has continued to drift back from record high levels, with 67,038 annual net permanent and long-term arrivals landing in New Zealand in the year to April, down from a peak of

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NZ Government caves on housing affordability

By Leith van Onselen In the lead-up to last year’s September general election, I praised New Zealand Labour’s housing platform because it promised 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 bond financing for infrastructure. I