Heatley Phil: Affordable Housing: Enabling Territorial Authorities Bill — Second Reading In Committee Third Reading 
Heatley Phil: Affordable Housing: Enabling Territorial Authorities Bill — Second Reading In Committee Third Reading 
[Volume:649;Page:18482] 
PHIL HEATLEY (National—Whangarei) 
: 
 Thank you Madam Chair. You have treated me with an even hand I very much appreciate that. I am delighted to take the opportunity to speak about solutions to unaffordable housing having been restricted in doing so—for a very good reason—to this point. 
I have been very surprised that the Minister in the chair Maryan Street has not made a single contribution this evening and I query that. She came to Parliament and has been upheld as a politician with a purpose and I certainly respect that but she has brought two pieces of legislation to this House. In the first one she wanted landlords to pay the cost of damage caused by tenants’ guests even though landlords have no control over whether tenants invite guests into the property and if they do over who the guests are when they come and what they do. She also wanted landlords to pay for accidental damage caused by tenants even though there is no way of proving whether the tenants did the damage accidentally or deliberately or of establishing what happened. This Minister brought that legislation to the House but it did not get the support of this very wise Parliament. Now she brings this Affordable Housing: Enabling Territorial Authorities Bill into the debating chamber and we have not heard a squeak out of her. I want to know why that is the case. Is she ashamed of the legislation? Has she read the legislation? Does she understand what this legislation does not do? 
I put it to the Committee this evening that this bill rather than giving the opportunity for first-home buyers to get affordable housing when they are under financial pressure or cannot get a deposit together to do so is about ifs buts and maybes. It essentially says that councils may—they do not have to but they could do so if they want to—provide affordable housing in their districts. If they do decide that they want to provide it they have to do an affordable housing study. That involves councils possibly going to various community groups depending on what they want to do or whom they may like talk to and putting together an affordable housing plan. Then if they decide that yes it is worth going forward or that maybe it is not worth going forward or that perhaps it may be worth taking a bit of a punt they may or may not require developers to set aside 10 percent of their land and put it in a land bank for affordable housing. 
But councils may decide they do not want to do that. They may decide get developers instead—perhaps—to write out a cheque in lieu of the land and put the cheque into a trust for affordable housing. Or—perhaps—councils may change their minds and decide that rather than doing that an alternative could be to get the developer or builder to build affordable houses in lieu of providing land or cash and put them into a trust for first-home buyers. Of course that ignores the fact that builders or developers if they set aside land or pay cash in lieu or—perhaps—build affordable houses themselves will take a financial hit and will therefore have to regain the profit or income they have lost because of those additional costs. That will mean putting up the prices of all the other houses in the development. Ninety percent of the buyers will pay more for their houses so that the costs are lower for those who may or may not get the opportunity to buy an affordable home if a council does or does not decide to have an affordable housing policy. 
That is the kind of policy that may be enacted tonight and if this legislation is enacted councils may or may not choose to use its provisions. If they do developers may or may not set aside land or provide cash in lieu or build houses themselves. Builders may or may not choose to do that if a council decides that it will or will not have an affordable housing policy. 
The interesting thing in all this sort of “perhaps-ness” is that councils have this wonderful opportunity—and there are two of them in this country that may or may not forge forward and take up the provisions of this legislation. 
Hon Member 
: Who are they? 
PHIL HEATLEY 
: I do not remember their names but I do remember that there are over 72 district councils across this country and two of them have said clearly to the Local Government and Environment Committee and have written to me and said clearly that they will definitely maybe take up this offer and are delighted to have this opportunity. That is good news for first-home buyers! 
National on the other hand says we definitely will give people tax relief so they will have more money in their back pocket because we understand that take-home pay is what pays a mortgage. National has said we will get interest rates under control because we know that even a 1 percent interest rate cut on an average mortgage is worth about $40 extra a week let alone a 2 percent interest rate drop which would mean about an extra $80 could go towards a mortgage so there is no housing pressure. On the one hand we have something that is in the ether and could happen. Some councils might take up the provisions of this legislation; if they do it is good luck to them and if they change their minds well that would be like a lot of things promoted in it. On the one hand there is whole lot of uncertainty and on the other hand the National Party leader is saying take-home pay matters and interest rates matter and those are the things we would address first. 
First-home buyers those who are looking for a home are under pressure. We know that property prices across the country have stabilised recently and have in fact dropped in many parts of the country. But they are still at a point well above what most young people can afford. That is also true for elderly people who would like to own their own home in their retirement. What is the Minister going to do about that? I do not know. She may speak tonight. She may not speak tonight. She may change her mind after the debate has closed and discover that it is all too late. I do not know what the Minister thinks and I wish she would take a call this evening. At least John Key says National will address the things that matter—the things that will affect all New Zealanders whether they want to buy a house or have bought a house and whether they are young or elderly. John Key will address the issues that matter and those are ensuring that take-home pay can service a mortgage and getting interest rates under control. 
Of course there is a bunch of other policies that we will be supporting but we cannot support this legislation. We actually do not know what use it will be. We do know that it could force up the property price of every other house on a subdivision if a council does take up the provisions of this legislation. We do know that councils right across the country have opposed this legislation because they feel that it will add more costs to their own bureaucracy and therefore to their ratepayer base. We do know that many many community housing organisations across the country are opposed to this legislation as well for a variety of reasons. But we do not know whether if this legislation does pass tonight any council will take up its provisions and any first-home buyer will get any benefit from that. 
In my earlier speech I did point out one thing which is that the genesis of this legislation actually came from the Queenstown Lakes District Council which does this voluntarily. Developers and builders there voluntarily set aside some land or cash or cheap buildings so that they can house nurses teachers police and hospitality workers for example who would otherwise find it very difficult to afford housing in Queenstown. Affordable housing is provided on a voluntary basis down there and that works very very well but the Labour Government feels it needs to legislate. Why does it need to legislate if Queenstown Lakes District Council is doing it already? That is a question that the Minister could answer. Why legislate when a council is doing this already on a voluntary basis in order to address a particular problem in a particular community in our country? Why legislate and why does the legislation give councils so many choices that it means affordable housing may or may not happen? Why legislate on something that is already able to happen under the current law? At the moment we have a situation where as I said Queenstown Lakes District Council can provide affordable housing already. 
I had an interesting email during the course of the debate which I would like to read to the Minister. This is from a builder somewhere in New Zealand. He was quite fascinated by the speeches that have been coming forth from this Chamber this evening. I hasten to add that the only party whose members are making any speeches is the National Party. However this is what this great New Zealander said: “Labour members do not want to acknowledge or choose to ignore that if you force developers and builders to provide low-cost sites it will only force the price of other sites higher thus reducing the affordability for other buyers. If you force builders to provide low-cost sections it will only force the price of other sections up thus reducing the affordability for other buyers.” Well I could not put the situation more succinctly than that. That is the problem. Essentially if district councils take up the opportunities available under this legislation—they may choose not to but if they decide to go forward after perhaps doing some consultation with the local community—in fact that may end up driving up house prices in a district rather than giving opportunities to first-home buyers in that district. 
This bill is one of a number of initiatives that appear to have turned to custard when this Government talks about affordable housing. Members will recall the discussions about Hobsonville. This bill came out at the same time as an announcement that about 450 sections in Hobsonville would be available for first-home buyers. Those sections and houses will cost $350000 to $370000. People will require a household income of $70000 to $75000 in order to be able to purchase one. I remember asking the Minister Maryan Street in the debating chamber one day whether she thought that low to middle-income earners would be able to afford one of her so-called cheap homes in Hobsonville if the home costs $350000 and it would require a household income of $75000 to service the mortgage buy food fill up one’s petrol tank and buy a block of cheese. She said of course low-income and middle-income earners would be moving into the houses at Hobsonville. I argued that low to middle-income earners do not earn $75000 per annum and that is where the debate was left. 
Perhaps the Minister could take a call and address that particular issue because I am still intrigued as to whether she considers that a low-income earner does earn over $70000 a year. My understanding is that low-income households earn nothing like $70000 or $75000 a year and low to middle-income earners cannot afford to buy $350000 houses even if the Minister puts a sign on the house saying it is a good cheap deal. Even if the Minister does put a sign on a house saying it costs $350000 it is cheap and it is a good deal I tell the Minister that most New Zealanders will not accept that. They do not believe that. That is far out of reach for them. 
So the Minister has a lot to answer for with regard to this legislation. She can tell us first of all why so many councils opposed it and why so few are supportive of it. She can tell us why it is voluntary. How is the Queenstown Lakes District Council able to provide affordable housing already? Why do we need legislation if that is in fact the case—or is she saying that council is breaking the law? And what is the answer to those builders out there who say as this gentleman—or woman—so aptly put it: “If you force builders to provide low-cost sections it will only force the price of other sections up thus reducing the affordability for other buyers.”? What is the answer to that builder? I would have thought that what that builder says is in fact the case. Perhaps the Minister in the chair Maryan Street can answer those questions.