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Source: New Zealand Labour Party

New Zealand’s housing crisis has many causes. It’s a problem that’s been decades in the making, and there’s no silver bullet or quick fix. It’s an issue that’ll take time to turn around, and it’ll require everyone working together to bring solutions to the table.

As part of this work, we’ve announced a package of urgent and long-term measures targeted at increasing housing supply, relieving pressure on the housing market, and tipping the balance away from speculators and back towards first home buyers.

Here’s what this announcement means for you and your family:

We’re making sure more first home buyers can access Government assistance to get into their own home by lifting the income caps on First Home Loans and First Home Grants.

With a First Home Loan, buyers only need a 5% deposit, rather than the 20% deposit required by most lenders. First Home Grants provide up to $10,000 to help people pull together their deposit.

We’re also lifting the price cap on houses able to be purchased through the schemes in targeted regions, helping more people into their own home.

Another way we’re backing first home buyers is by extending the bright-line test from five years to 10 years, and by closing a long-standing tax loophole that benefits property speculators.

The bright-line test was introduced under the National Government, and is designed to make flipping properties less attractive. Right now, if you buy an investment property and sell it off within five years, you’ll have to pay income tax on the profits. We’re extending this to include investment properties sold within 10 years. We’re also closing the loophole that allowed property speculators to write off interest costs against the income they make from their properties.

Together, these steps should help to discourage speculation, and give first home buyers more options.

The bright-line test does not apply to the main family home or inherited property, and these changes do not include introducing a capital gains tax. You can read more about the bright-line test here.

Another important part of tackling New Zealand’s housing problem is increasing supply – making sure there are actually more houses available.

That’s why we’re incentivising investment in new developments, rather than existing housing stock. If you invest in a new build property, you will be exempt from changes to the bright-line test and interest deductibility policy.

This will make investing in new builds a more attractive option for investors and drive demand for new houses, which will help more new homes to be built, ease the pressure on first home buyers and ultimately help increase our housing stock.

The Government can’t solve the housing crisis alone. When it comes to building new houses, local government also has a crucial role to play – but often, councils are unable to fund the vital infrastructure like water networks needed for new developments.

One of the things we’re often told is that a lack of the roads and pipe needed to service new housing is one of the main infrastructure blockages that are holding up the building of new homes. To deal with this we’re launching a $3.8 billion Housing Acceleration Fund, which will speed up the pace and scale of house building.

This will jumpstart housing developments by funding the vital infrastructure needed for new housing. It will help large-scale construction projects get going faster, and is something local government and developers have been calling for for some time.

By removing these barriers for local government, we’re helping to enable more houses to be built, right across the country.

We know we need to train and upskill more workers for our construction sector. Thanks to our free apprenticeships and targeted trades training scheme, we’ve already seen 100,000 people take up trades training, including more than 30,000 people going into construction.

To build on this growth, we’re extending Apprenticeship Boost payment until August 2022 to help employers keep and take on new apprentices. This will help ensure we have the skilled workforce we need to build more houses and keep our construction sector moving. More than 21,000 apprentices have been supported by the payment so far.

Learn more about our free apprenticeships and targeted trades training scheme here.


There is no single answer to the housing issues New Zealand faces, but the policies we’re putting in place will make a real difference – and they’re just one part of our ongoing plan to tackle the housing crisis.

This package builds on the work we’ve already done to improve housing in New Zealand, including building a record number of public houses, stopping overseas speculators, reforming the RMA, making tenancy laws fairer, and ensuring rental properties are warm and healthy.

You can read more about all that we’re doing in housing here. Still have questions about today’s announcement? Check out our housing Q+A here.

MIL OSI