Monday, February 13, 2017

60,000 houses

That's the size of National's housing market failure:

New Zealand is up to 60,000 houses short, with Auckland needing as many as 35,000 homes, estimates in a Treasury document suggest.

The figures are part of housing supply and demand forecast produced in September of 2016 and released in January as part of an Official Information Act request.

Using their own metrics, Treasury estimate that the "cumulative shortfall" houses in Auckland was at between 30,000 and 35,000 in June of 2016.

That figure is estimated to get slightly worse in 2018, as the population continues to increase, before improving.

According to free market ideology, the market always provides just the right amount of goods. Clearly in the cases of homes it doesn't. Land-hoarding by developers, capital constraints - whatever the cause, the market has failed.

There is an obvious solution to this market failure: a massive, government-run home-building program like we had in the 1930's. But National won't do it, because they are ideologically opposed to government doing anything (except for handing out free money to foreign billionaires). Which means that people will keep on sleeping in cars and garages because there just aren't enough houses to go round.

As with climate change, water quality and child poverty, if we want any chance of fixing this we need to change the government. Fortunately we'll have a chance to do that in September.