Monday, May 15, 2017

Market failure

New Zealand has a housing crisis. The government is in denial about this because it is ideologically wedded to a theory that the market perfectly matches supply to demand. Meanwhile, in reality, things are a bit different:

Only 7200 new residences were built in Auckland last year, barely half the number needed and only slightly up on the last two years, an expert says.


Freeman requested Auckland Council data on new residences completed based on code compliance certificates issued solely by the council and she said she discovered building numbers were falling far short of requirements.

"The numbers being completed are far less than those consented. Statistics from Auckland Council show that last year 7200 houses were built and 6520 and 5550 were completed for year end 2015 and 2014 respectively," she said.

Yet Auckland needed about 14,000 new residences annually, made up of houses, apartments, townhouses and terraced dwellings.

"Despite all the focus on housing in the last nine years, we are barely completing half the number we need," she complained.

There is a name for this: "market failure". And the solution is obvious to all: build more bloody houses. Its something the government has done before when the housing market has failed, and which was effective. But instead of doing that, National has been tinkering around the edges and trying to find ways to further enrich the useless property developers and landbankers responsible for this failure, rather than stepping in and fixing it.

But I forget: they're a government of landlords. And to them, people living in tents and caravans isn't a fundamental indecency, but a further opportunity for them or their donors and cronies to profit from our misery.