New Zealand has a housing crisis. An entire generation is being locked out of the housing market by greedy speculators, the average Auckland house price is just short of a million dollars, and people are living in cars because they can't afford rent. But rather than doing the obvious - imposing a full capital gains tax, building more houses and crashing the market - National's "housing policy" seems to consist entirely of looking for someone to blame. Last week it was local government. Today, its the Reserve Bank:
Prime Minister John Key has expressed further frustration about the Reserve Bank's response to rising house prices, saying that it should not need any more time to investigate stricter rules for property investors.
Reserve Bank deputy governor Grant Spencer last night said that the bank was considering new loan-to-value ratio (LVR) restrictions, but would not introduce them before the end of the year.
Spencer also told the Government to get its own house in order, by taking another look at its immigration and tax settings.
On Wednesday, the Prime Minister had urged the bank to target investors with tougher lending rules, saying it should "just get on with it".
Because obviously its the responsibility of the unelected, unaccountable Reserve Bank, rather than the elected, accountable government, to decide policy in this area.
You can see why the government wants to dump this problem on someone, anyone else: deflating the housing market is going to make a lot of people (particularly people who feel rich because they own a house, or people who have paid too much for a house in the last four years) very unhappy. But it needs to be done. This housing crisis is tearing our society apart and it needs to be resolved.
We pay John Key almost half a million dollars a year. We pay his crony-Ministers more than quarter of a million each. They don't get the big bucks for doing nothing, sitting on their hands and blaming other people - we pay them to take responsibility and solve our problems. And if they're not going to do that, they should step aside for someone who will.
