Twyford Phil: Questions for Oral Answer — Questions to MinistersText is incorporated into the Bound VolumeTwyford Phil: Questions for Oral Answer — Questions to Ministers[Sitting date: 27 May 2014. Volume:699;Page:18306. Text is incorporated into the Bound Volume.]6.PHIL TWYFORD (Labour—TeAtatū) to theMinister of Housing: Does he stand by his statement that a register of foreign ownership “would be a waste of money”?Hon Dr NICK SMITH (Minister of Housing): As I said last week I am open to having more information on overseas ownership but I do not favour a register. For it to be accurate it would need to trace not only the 80000 houses per year that are sold but the 1 million - plus people who come and go from New Zealand. That is because a significant number of overseas homeowners are people who are in the process of gaining residency and for the register to be accurate it would need to trace people’s immigration and residency status.Phil Twyford: How much would it cost to require the conveyancing solicitor to certify whether or not the purchaser is a resident or a citizen?Hon Dr NICK SMITH: For a register to be accurate it would need to do more than that. It would also need to follow any change in people’s residency or immigration status after that point. Otherwise the moment the register is created it would be inaccurate. I do note with some interest though that in 2005 after even higher house-price inflation and even higher immigration a previous Labour Minister said when a register and restrictions were suggested that it would be “impossible and absolutely stupid”. That Minister was Dr Michael Cullen.Phil Twyford: How many of the 39000 houses he has promised to build in Auckland over the next 2 years will be sold to cashed-up overseas buyers shutting outlocal Kiwi families and what restrictions has he placed on these homes to ensure they do not end up in offshore ownership?Hon Dr NICK SMITH: I would suggest that the member has a chat with the leader of his party who has been facilitating overseas persons buying homes in Auckland. We are a party that takes an open view of New Zealand and I am confident that those tens of thousands of additional homes that we are building will go to goodol’ New Zealand families.Rt Hon John Key: Has the Minister seen reports of a German who is looking to buy a very large home in New Zealand and does the Minister think it would be unusual for a party that is opposed to foreigners buying homes to then want to form a Government with that said German?Hon Dr NICK SMITH: I have noticed that there is a German overseas interest who has a big interest in owning very large homes and I note that Labour is keen to form a coalition with the—Mr SPEAKER: Order! That part has nothing to do with the Minister’s responsibility.Phil Twyford: Is he aware that the new Australian Federal Government has launched an inquiry into Australia’s foreign ownership restrictions which is aimed at toughening up the rules and increasing enforcement and is this just another example of the Minister being right and everybody else being wrong?Hon Dr NICK SMITH: I am taking a considerable interest in the Australian inquiry because it has been triggered because their overseas ownership restrictions have been proven to not work—that is there is a huge number of people who get around them by creating properties in trust it is very difficult to trace the change in residency and in fact Australia has a higher level of overseas ownership than New Zealand has despite their restrictions.Phil Twyford: Why is the Productivity Commission concerned in its report that New Zealand residential property is becoming more attractive to overseas buyers and to what extent does an average Auckland house price of over $700000 increasing by over $1000 a week make residential property less attractive to Kiwi families and even more attractive to offshore speculators?Hon Dr NICK SMITH: I am delighted the member has raised the issue of the Productivity Commission because the commission did a comprehensive report on housing affordability. It received over 200 submissions and it did not make a single recommendation saying that a capital gains tax would work. It also said that the issues of overseas ownership would have absolutely no effect. It said that there were five important issues that needed to be addressed. The Government is addressing all five of those because we are interested in the substance and not the politics of housing affordability.