The media are currently imbued in the housing crisis, and consistent as ever, are talking nonsense.
We’ve had much publicised finger-pointing at one another by the Reserve Bank Governor and the Finance Minister as to culpability, but all of this misses the point.
Rising house prices are like rising prices in anything, simply a reflection of demand exceeding supply.
The massive Asian migration which began in the 1990s and which in my view is the best thing ever to happen to this country (good looking girls, hard workers etc) set the demand and supply imbalance in motion.
The huge inflows increased under the Key government, albeit they were no longer solely Asian but additionally coming from troubled Middle Eastern and Latin American nations, plus South Africa, all to our advantage. But naturally they also compounded the housing demand and supply imbalance.
This is a terribly easy problem to solve.
First; we don’t have anywhere near enough building tradesmen to restore a demand and supply balance.
When we don’t have enough of any other desired commodity we import it. That’s precisely the way to handle the housing issue. It’s how we handled the Christchurch rebuild.
Create a new state house township sub-division on Auckland’s outskirts then go to tender in China.
They think big there and major Chinese contractors would have no trouble flying in a thousand tradesmen who will first erect their temporary barracks then go to it.
These tradesmen will happily work 6 or 7, 10-hour days weekly, so as to take as much money home as possible and lift their personal financial status to middle-class.
They’ll bang up as many houses as we want in double quick time and at a damn sight cheaper cost than relying on trying to do it ourselves.
Of course, there’s more to it than that if we’re to avoid creating ghettos. A town retail centre, parks, schools, public transport, swimming pools, public buildings and so on will all need to be part of the plan, so too mass tree-planting, much of which we can handle.
But in the short term we can knock the top of the state house shortfall problem in one fell swoop and thereafter leave it to our existing building industry to maintain supply in accordance with demand.
A new town of 20,000 houses will achieve that and logically it should be Auckland based in accordance with the main demand location.