7. Question No. 7—Prime MinisterBROOKE VAN VELDEN (Deputy Leader—ACT) to the Prime MinisterQuestion No. 7—Prime Minister7. BROOKE VAN VELDEN (Deputy Leader—ACT) to the Prime Minister: Does she stand by her statement regarding the Government's housing policy that it will tip the balance in favour of first-home buyers through our demand measures"? Rt Hon JACINDA ARDERN (Prime Minister): I stand by my full statement in the House yesterday which was "the Government's decision to support more first-home buyers with a deposit on their first home tip the balance in favour of first-home buyers through our demand measures incentivise investment in newly built homes and jump-start developments by funding the vital infrastructure like pipes and transport links needed for new housing. New Zealand's housing crisis has been decades in the making and there is no silver bullet [or] quick fix. It's an issue that will take time to turn around but our package of … urgent and long-term changes will increase housing supply relieve pressure on the market and make it easier for … home buyers." Brooke van Velden: If the housing market is being rebalanced towards first-home buyers who is it being rebalanced away from? Rt Hon JACINDA ARDERN: You can see by what we're trying to do on the demand side that we are trying to reduce some of the demand we've seen by those who are operating in a speculative way and you can also see that from the recent data we have had an additional proportion of the housing market taken up by those who identify as investors and by those who have multiple homes already—so that in the last quarter my recollection is was making up about 40 percent of the market. So we expect that some of our demand side measures will have an effect there and that will make it easier for those who are purchasing their own homes. Brooke van Velden: Will the changes to the brightline test result in any people who own a single home being taxed? Rt Hon JACINDA ARDERN: The purpose of the brightline test as it was introduced by National was to always make sure that if it was the primary home it was exempt from the brightline test and so that is the way it was designed. We are continuing with that. We have put extra clarification around the change-in-use test which is essentially when someone is no longer using it as their home. Nicola Willis: How many more first-home buyers does she expect will buy homes over the next 24 months as a result of the policies she announced yesterday or would she prefer not to be held accountable to any specific target? Rt Hon JACINDA ARDERN: Obviously there are going to be a range of factors that will affect the number of first-home buyers that are entering into the market. What I can tell the member is that the estimates for just one element of the package which is the change in caps and income tests for our first-home buyer products will have roughly 9300 additional couples who will be eligible and up to 3000 singles who will be eligible. So those are the numbers that we have on just one element of the package. Brooke van Velden: Is she concerned that changes to the brightline test will result in fewer homes for sale? Rt Hon JACINDA ARDERN: As we've already heard the revenue Minister talking about previously if someone is choosing to no longer be an investor in the market that's not removing the number of houses that are available. The quantum remains the same. What we want to do is get additionality and that's where we're using incentives to try and encourage those who may want to enter as an investor to buy a new build and that may of course then free up if you're going to an auction or you're in the market the amount of competition that is in the market already between investors speculators and first-home buyers. Brooke van Velden: What are the key differences between the brightline test and a capital gains tax? Rt Hon JACINDA ARDERN: I refer back to the National Party's references at the time. I believe John Key said that a capital gains tax would be applied to a property no matter when it is sold after how long it is sold for and so on. I would also add capital gains taxes as they have been proposed in this country have been comprehensive. They include small businesses and the like. Finally what I'd also add is that they certainly don't have the level of exemptions that we have including around new builds. Hon Dr Megan Woods: Has the Prime Minister seen reaction from the property industry such as Wendy Alexander from the Real Estate Institute of New Zealand who said "However the fact that new builds are to be exempt from the bright-line test is welcome news and could go some way to helping to boost the overall supply of housing."? Rt Hon JACINDA ARDERN: Yes. I've actually seen a number of quotes from different representative bodies supporting the packages we announced yesterday. I would add to that the president of Local Government New Zealand who said "Today's announcement will be welcomed by communities across New Zealand who have been locked out of the home ownership by property speculators taking advantage of historically low interest rates." Brooke van Velden: Why is she rushing tax changes through Parliament without consultation but unable to deliver immediate changes to help boost housing supply? Rt Hon JACINDA ARDERN: Two things I'd quickly say on that. On the legislative changes that help create housing supply the close example of course would be things that we can do to planning and resource management. We actually have already created a fast-track process already. That is in place we are utilising that and the member sitting next to you already knows of a housing development in his area that is the subject of that fast-track process. When it comes to the decision yesterday to put changes to the brightline test through we are very aware that changes in this area can cause extra heat in the market. We wanted to avoid that so both interest deductibility and brightline changes will apply to houses purchased after 27 March. But on interest deductibility we are consulting on some elements of that to make sure we get the definitions right for new-build exemptions."