Robertson GrantGRANT ROBERTSON (Labour—Wellington Central): Thank you very much Mr Chair and I look forward in the course of the coming days to debating new Parts 7 and 8 of this bill. On new Part 5 I want to make a couple of significant points. The first is the question around whether or not new Part 5 contributes to the purpose of improving the affordability of housing. I do want to note that the Government in its tinkering timid kind of way when it comes to housing did realise that this was an area that could contribute to improving the affordability of housing. In the Budget 2015 speech when Bill English introduced the brightline measure that we discussed earlier in new Part 4 he also introduced the foreign buyer register which I am going to come to in a moment and in doing so when he introduced that in Budget 2015 he actually used the phrase that this was part of a number of measures that would take pressure off the Auckland housing market. That is what he said. So the Government was quite clear that an initiative that started to address the impact of foreign buyers on the New Zealand housing market was a measure not just about taxation not just about land but actually about easing the pressure on the Auckland housing market which today the Minister for Building and Housing has confirmed for New Zealanders is out of control—and it most definitely is. The second thing I want to raise in that regard is the question of the disproportionate impact of foreign buyers or speculators on the New Zealand housing market. The kinds of people who are involved in this level of speculation are prepared to pay well over the odds for housing which pushes the prices up overall and has the effect of pushing first-home buyers out of the market. I want to give an example from here in Wellington from somebody who I know had been living in a rented house in a northern Wellington suburb and had to leave the house because it was sold from under them and the rent was put up. The reason the rent was put up was that the house was sold to an offshore buyer for some $500000 over the Government valuation that it had.Hon Annette King: Sight unseen?GRANT ROBERTSON: Sight unseen. In fact talking to the real estate agent responsible for that sale he said that within an hour of that property going up on their website 13 offers had come in 12 of them from offshore speculators—12 of the 13 offers came in from offshore speculators—and someone at the end of the day was prepared to pay $1.2 million for a house worth about $700000. That is the disproportionate impact of an offshore speculator on the New Zealand housing market. Often with capital accessed at a much lower rate or capital that they want to shift quickly out of the country that they are resident in the New Zealand housing market represents an opportunity for speculation and it is that speculation that is driving up property prices and is pushing first-home buyers out of the market. So this new Part 5 is a measure to improve the affordability of New Zealand housing. The question does remain: what is the extent to which it will improve the affordability of housing? This is obviously a very live debate because the Government as I said in Budget 2015 decided that it would announce as part of its desperate attempt to look like it was doing something in the housing area a foreign buyer data register. We have now seen a couple of releases of information from that register but they do not give the full picture. The Government likes to tell us that foreign buyers according to its data represent 2 or 3 percent of the buyers in the market but a closer analysis of the statistics reveals that there is a giant fudge going on here by the Government. In the last data that was released the Government told us that of the sales of houses in the last year 2300 of them went to non-residents—people who as has been described to us today are not people who come here. These are people who do not have a right to live here who do not live here and who have no intention of living here—except that is not quite what the Government has done because in addition to those 2300 non-residents another 5700 properties were purchased by—[Bell rung] Mr Chair?The CHAIRPERSON (Hon Trevor Mallard): Grant Robertson.GRANT ROBERTSON: That is very good—nice. Ha ha! Thank you very much Mr Chair. That means another 5700 were—I am good with people stretching their legs without saying anything. It is excellent—good work. So a further 5700 were bought by people on temporary visas including students. These are people who do not have the right to stay and live in New Zealand on a permanent basis. So if we add together the 2300 that were bought by non-residents as defined by the Government to the 5700 that were bought by people on temporary visas that actually amounts to 13 percent of the total sales—well in excess of what the Government is admitting and quite clearly having a major impact on the housing market and the price and affordability of housing. So what is the Government's response to the fact that it brought in a foreign buyer data register that there was pressure on it about this? Its response is twofold. It is to put out dodgy numbers and to call anyone who raises the spectre of this as an issue xenophobic. That is ridiculous. It is typical of this Government putting its head in the sand about housing issues rather than facing up to the impact of them. So when we have a situation where yesterday the average house price in Auckland hit a million dollars and the Government says that the housing market is out of control but it has got no plans to change it that is not on. It is a Government in denial now pushing housing further and further out of the hands of New Zealanders. If you want to know the impact of foreign buyers of speculators in the housing market and of the lack of supply from the Government Bill Rosenberg from the New Zealand Council of Trade Unions has calculated that if average wages had increased at the same rate as house prices in the last few years the average wage would now be $69 per hour instead of $29 per hour—if the rate of wage increases had kept up with the rate of house price increases. It is out of control and it is being fuelled by people from overseas who look at the opportunity for a speculative gain in the New Zealand housing market.Phil Twyford: And why wouldn't they?GRANT ROBERTSON: Exactly—and why wouldn't they in an environment where there are few rules around them and where all around the Pacific area and all around the world countries have said their priority is to make sure the people who are resident there have the first chance to get themselves into housing. That is the priority. Australia does it. Other countries within the Trans-Pacific Partnership have carved out the right to do this. Vietnam and Malaysia have got it China has got it but New Zealand does not and that is a failure on behalf of this Government because it has simply decided to wish the problem away. New Part 5 of this bill offers the opportunity for this Government quite clearly to take on board a policy that will improve the affordability of housing. In my time remaining I want to make one thing very clear and that is that this is about—and this is important for us on this side of the Chamber—the purchase of existing housing. We do need to add to the supply of housing in New Zealand and we do know that some of the good positive developments in housing that have been taking place in Auckland have actually been funded by money from offshore but that is new housing—that is adding to the stock. It is helping to solve the problem. Speculating on existing housing driving up the prices does nothing to solve the problem. It makes the problem worse. That is what new Part 5 of this bill aims to address: people with no interest in moving here people with interest only in speculation. So I want to make it clear: that is covered here within new Part 5 the new section 17A(c)(iii) within new Part 5. It covers off the fact that if people are going to add to the housing stock and create new housing that is a good thing and can be managed within the regime that we have but if all they are interested in is speculating driving up housing prices and pushing young New Zealanders out of buying their first homes then that has got no place. This is one aspect of a comprehensive plan for housing along with building affordable housing along with increasing the stock of State housing and along with fixing the homelessness crisis. We have the comprehensive plan over here. Here is one part of it. Here is a chance for National: step up vote for this and do something instead of sitting on your hands.