Little Andrew: Oral Questions — Questions to MinistersText is incorporated into the Bound VolumeLittle Andrew: Oral Questions — Questions to Ministers[Sitting date: 21 July 2015. Volume:707;Page:5105. Text is incorporated into the Bound Volume.]3.ANDREW LITTLE (Leader of the Opposition)to the Prime Minister: Does he stand by his statement in relation to affordability of homes in Auckland that “there’s a general view that housing prices are not overvalued” given that the homeownership rate has fallen to its lowest level in 64 years?Rt Hon JOHN KEY (Prime Minister):This is a very misleading piece of selective quoting and in fact was not made in relation to the affordability of homes in Auckland at all. I stand by the full statement I made. When asked to comment on the fact that New Zealand has not had a housing correction in 45 years I said “One of the reasons why you probably haven’t had a significant correction is because over the last 45 years there’s probably been a general view that houses are not overvalued relative to a whole lot of different factors. My point is that the market in the end assesses when housing is massively overvalued compared to fundamentals not politicians.”Andrew Little: Does he still think that the typical Auckland house is affordable for the typical Auckland family when prices have risen five times faster than incomes under his watch and the median house now costs 10 times the median household income?Rt Hon JOHN KEY: There are a variety of different measures around affordability but what I do know is that house prices doubled under the previous Labour Government and interest rates are considerably lower than they were under the previous Labour Government. If one even looks at homeownership rates our homeownership rate at 64.8 percent is highly comparable with other OECD countries.Andrew Little: Is he aware that in the past year the number of owner-occupied homes fell by 2400 while the number of rentals rose by 19800 and does that not show that his policies are favouring investors while taking the Kiwi dream of homeownership away from families?Rt Hon JOHN KEY: No. There are a variety of different reasons why people may move into rental properties. For one thing Auckland actually has been growing in size and many people move to a city and rent a property as the starting thing that they do.Andrew Little: Why is it the policy of this Government—of his Government—to allow overseas speculators to profit off New Zealand homes contributing nothing to our economy while pushing prices out of the reach of more and more families?Rt Hon JOHN KEY: Firstly I reject that but secondly we have the policies that were introduced actually by the Labour Government. It passed the foreign investment rules in 2005. Apparently Winston was part of it happily praising it and voting for it. They were good enough for Labour in Government but they are not good enough for Labour in Opposition. Mind you it is a very different Labour Party these days is it not?Mr SPEAKER: Order! [Interruption] Order! I am calling for less interjection from my right-hand side.Andrew Little: Can he guarantee that the Inland Revenue Department database will be public and will clearly reveal the number of non-residents buying New Zealand houses?Rt Hon JOHN KEY: As the member knows there is a process that we are going through at the moment. There is a bill in the House and we will be looking at that data. But what I do know is our information will not be cooked up and when someone asks me a question about it I will not lose my rag at TV3 like that member did before.Andrew Little: Why did he give offshore speculators 4-months’ notice of the upcoming change of rules giving them time to game the old system when he cancelled the KiwiSaver kick-start on the day of the Budget so that parents could not sign their kids up?Rt Hon JOHN KEY: If the member ever gets into Government then he may realise that tax law is a very complicated and complex thing. If we had not actually had a period of time where there was an opportunity for tax specialists and others to give input into the process then you may have got unintended consequences. Secondly nothing changes under tax law in New Zealand as a result of the brightline test. If someone buys on revenue account then they will still be subject to paying tax. You can be sure as I said at my post-Cabinet press conference yesterday afternoon that the Inland Revenue Department will be looking very closely at people who buy houses at the moment like it does all the time and it will be collecting tax revenue off people who owe it.Andrew Little: If he has done all he can on housing why are Auckland house prices accelerating rather than stabilising why are the number of homes owned by people who live in them falling and why are so many offshore websites urging speculators to keep on buying in Auckland?Rt Hon JOHN KEY: As we know we really have to question any piece of data or information the Labour Party puts out there these days in whatever language it introduces it. I actually stand by the Government’s record on what we have done: 118 special housing areas on which we expect 50000 new dwellings the vast bulk of which are in Auckland; the brightline test that is there; the $50 million that is set aside for residential housing development; the KiwiSaver HomeStart programme which as I saw the other day in the paper is doing exceedingly well; and the other rules that we have changed around the cost of imported materials. This Government has done a great deal when it comes to housing—Mr SPEAKER: Order! The answer is quite long enough.