The key initiative in yesterday’s budget is a plan to grow Auckland’s housing bubble. Auckland’s housing bubble is projected to take over from dairy farming as the fastest-growing sector of the New Zealand economy.
Consider a typical Mangere housewife. For years she struggled to raise her children when money was tight. Now that the children have left home, and she and her husband have finally paid off the mortgage, wouldn’t it be nice if their house was suddenly worth a million dollars? This is the brighter future the government’s budget offers. The average house in Mangere isn’t yet worth a million dollars, but it will be within a few years. The time is not far off when all Aucklanders will live in multi-million-dollar houses, or in converted garages or garden sheds out the back of multi-million-dollar houses.
The minister of Finance explained it like this. “Until recently, people thought Auckland house-price inflation could not easily be turned into an exportable commodity. They were wrong. When foreign landlords buy Auckland houses, New Zealanders get the money, and because the houses are still in New Zealand, New Zealanders get to rent and live in the houses. But when the bubble finally bursts, foreign investors will make the losses.”
“But isn’t it racist to take advantage of foreigners like that?”
“Not if some of them are Australians It’s not racist to take advantage of Australians”
When asked if the developers who are being given access to government land will be building affordable houses, the Minister of Housing replied “they’ll be at prices that investors with access to 1% mortgage rates from foreign banks can afford”
“But what about average New Zealanders?”
“Well, John Key’s an average New Zealander, and he could afford one”
“You know what I mean, Dr Smith. What about the Aucklanders who can’t afford houses in Auckland at the moment?”
“Many people think the government doesn’t care about the children living in converted garden sheds in South Auckland, but nothing could be further from the truth. We won’t let the bubble burst until foreign investors have paid to build enough McMansions for all of them”
“but will the foreign investors actually rent to those families?”
“When the bubble bursts, the banks will sell the houses for whatever they can get for them”
“what? Sell to poor people living in garages in South Auckland?”
“No, of course not. They’ll sell them to retired dairy farmers who will rent them to those people”
Can of Worms, Opened 