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Source: New Zealand Parliament – Hansard



Question No. 1—Finance

1. Hon JULIE ANNE GENTER (Green) to the Minister of Finance: Does he stand by his statement that “all parts of the economic apparatus” need to address rampant increases in house prices; if so, will the Government’s upcoming announcements include bold policies to reduce house prices in a controlled way?

Hon GRANT ROBERTSON (Minister of Finance): I stand by that statement in the context it was given, regarding the Government’s decision to incorporate housing into the monetary policy remit between the Government and the Monetary Policy Committee of the Reserve Bank, to ensure that “all parts of the [economic] apparatus need to be working towards these goals.” With regard to the second part of the member’s question, this Government has an ongoing policy agenda to address unsustainable house price growth, increase housing supply, support renters, and provide more opportunities for first-home buyers, and we will continue to roll this out. I’m sure the member appreciates that there will be no one single policy that will solve the housing crisis. This is a big, complex, longstanding challenge that will require continued, bold intervention over a long period of time. Our upcoming announcements will be part of that programme of work.

Hon Julie Anne Genter: Does he think house prices should increase, stay the same, or decrease, in the context of the median house price in New Zealand increasing by $50,000 in February alone?

Hon GRANT ROBERTSON: As I said in my primary answer, the level of house price growth the member mentioned in the latter part of that question is unsustainable, and that is the very reason why we are bringing forward a programme of announcements next week.

Hon Julie Anne Genter: Point of order. He certainly addressed the questions, but it was quite a specific question about—not whether it was unsustainable but whether house prices should increase, stay the same, or decrease.

SPEAKER: Yes, and, as the member is aware, she can’t get that specific, like a sort of a yes/no answer or pick A, B, or C, in the context of a supplementary question.

Hon Julie Anne Genter: Will he remove the five-year cap on the brightline test so that anyone investing in a second—or tenth—property pays tax on the profits?

Hon GRANT ROBERTSON: As I’ve said in the House a number of times, we’re taking a look—we have taken a look—at the existing initiatives that we have in place, which includes the brightline test brought in by the National Party and then extended by the last Government. Announcements around those issues, and others, will be made next week.

Hon Julie Anne Genter: Will he provide the Reserve Bank with more tools to regulate mortgage lending that is a risk to financial stability and contributes to our overheating housing market?

Hon GRANT ROBERTSON: As the member will be aware, I wrote to the Reserve Bank Governor on exactly those issues, in particular the question of whether or not there should still be interest-only mortgages available to investors, and also whether or not debt-to-income ratios could be applied to investors. I’m awaiting a response from the Reserve Bank on those matters. I do note, in the context of ideas that have been put forward today around the housing market, the question of debt-to-income ratios and first-home buyers is a very tricky one, and if those debt-to-income ratios were applied broadly, I think there might be more inequity in the housing market. That’s the issue I’ve raised with the Governor.

Hon Julie Anne Genter: Will he provide fiscal stimulus by raising benefits so that the Reserve Bank can wind down its house-price inflating large-scale asset purchase programme and funding for lending programme?

Hon GRANT ROBERTSON: The Government has already increased benefits. We increased them, in fact, a year ago today by $25 per week. In addition to that, we’ve had support including increasing the winter energy payment and other parts of the Families Package. We’ve also increased the minimum wage significantly, by about 27 percent. Further decisions, obviously, are subject to the Budget.

Hon Julie Anne Genter: Will his Government increase Kāinga Ora’s debt limit, empowering them to build many more public and affordable homes?

Hon GRANT ROBERTSON: Again, I could say ibid, but all decisions around such matters would be part of Budget consideration. What I can say is we have significantly increased Kāinga Ora’s borrowing capacity over this term of Government in order to do exactly the things that the member is asking.