Sio William: Housing Accords and Special Housing Areas Bill — In CommitteeText is incorporated into the Bound VolumeSio William: Housing Accords and Special Housing Areas Bill — In Committee[Sitting date: 03 September 2013. Volume:693;Page:13177. Text is incorporated into the Bound Volume.]Su’aWILLIAM SIO (Labour—Māngere): I have never heard so much rubbish as I heard from that particular member there Peseta Sam Lotu-Iiga. For 5 years that Government there has sat on its hands and has made things difficult for New Zealanders trying to get a home. He asked a question that I am going to pose to the Minister of Housing the Hon Dr Nick Smith. Minister what is the price of an affordable home under your Government? Will somebody who is on the individual median income of $20000 be able to afford a house to be built based on the measures in this particular bill the Housing Accords and Special Housing Areas Bill? Will a family with a combined household median income of $40000 the likes of which we have in Manukau City be able to afford a home under the bill that you have here? Minister those are the questions that rightfully you should be answering.Hon Dr Nick Smith: Happy to.Su’aWILLIAM SIO: I hope you do. I hope you do take a call Minister to answer that because that is particularly important.Peseta Sam Lotu-Iiga: I raise a point of order Mr Chairperson.The CHAIRPERSON (Eric Roy): No that is exactly what we had over there before. It is a rhetorical question.Peseta Sam Lotu-Iiga: He brought the Chairman into it. That member has been around long enough—to bring you into the debate.The CHAIRPERSON (Eric Roy): No hang on. The member objected when he got a similar response from the Opposition over here. There will be other calls.Su’aWILLIAM SIO: Can the Minister guarantee that someone in Manukau earning a median income of $20000 will be able to buy an affordable house under this bill? Can the Minister guarantee that a household on a median income of $40000 will be able to afford a house? And how many will be able to buy a house based on the measures in this particular bill?For 5 years the Government did nothing but when Labour started announcing our policy that we would address the problem and that we would build 100000 houses over 10 years and when we started talking to the industry to ensure that the price would be affordable all of a sudden in this Budget the Government came up with this particular bill. The shame of it is that it did not even have the decency to talk to the Auckland Council—The CHAIRPERSON (Eric Roy): Order! Would the member Brendan Horan please leave and get properly dressed. SorrySu’a William Sio.Su’aWILLIAM SIO: It did not even have the decency to negotiate in good faith and to give the Auckland Council a heads-up. The introduction of this bill was a surprise—guaranteeing powers by this Government to simply override local councils and the ability to make decisions on behalf of their particular communities.There is a housing crisis in New Zealand. There is a housing crisis because there is a shortage of rental property. The quality of the rental property in the private sector is appalling in some instances. There is a housing crisis because it is becoming very very difficult for first-time homeowners to get into a home. So if we come to an agreement that there is a housing crisis then we should also be prepared for the Government side to accept some of the sage advice that people like Maryan Street and Annette King are offering that particular Minister. I think that unless this Government recognises that that is a real problem then it is not going to be able to solve it.Look at the bill and look at what we have in this bill. Clause 4 says that “The purpose of this Act is to enhance housing affordability”—enhance housing affordability! All it offers up is “facilitating an increase in land and housing supply”. That does not guarantee it. If the Minister is so confident that this bill is going to guarantee that then I would like him to state that he can guarantee that there will be more people getting into affordable houses. Recognising that in the community that I represent the median income is $20000 for an individual and $40000 for a household I asked the Minister the other day whether there was any consideration given to what income levels a first-time homeowner should be earning in order for them to be eligible for a mortgage to buy one of his so-called affordable houses. Here is the answer: “The accord is about increasing supply of homes. It does not determine the criteria for eligibility for a mortgage. This is an issue for the banks.” So guess what folks? The banks have turned round and made it really really difficult—under the Government’s watch extremely difficult—for the 70 percent of New Zealanders who do not own their own home.I want to point out also the reason why it is important to highlight the median income for individuals and the $40000 median income for households. If you look at clause 9 it states that before the Minister makes a recommendation to insert the name of a region or district in Schedule 1 “the Minister in determining whether a region or district experiencing significant housing supply and affordability issues” in clause 3(a)(i) must have regard to whether “the weekly mortgage payment on a median-priced house as a percentage of the median weekly take-home pay for an individual exceeds 50%”. Well I put it to this Committee that with an individual median income of $20000 when youconsider the current prices at the moment inMāngere of $300000—I think that last week houses that were normally $300000 were going for $500000 or $700000 and this is no BS Minister. It also says “based on a 20% deposit”. May I ask the Minister how his bill guarantees that somebody on a median income of $20000 is going to be able to raise a 20 percent deposit on a house that is either $300000 or $500000 or $700000? Those are the kinds of prices Minister in the South Auckland region.I have to say that given the context from which this bill springs I do not have confidence that this bill addresses affordability issues. I do not have confidence at all in simply enabling greater supply if you are not going to also attack the issues around those who speculate on houses and the issues around those who bring in foreign capital and are speculating on houses unless the Minister is prepared to address that and include that particular package in this bill. I can tell you now that nobody in South Auckland believes that this bill is a guarantee for those who want to own their own home—first-time homeowners. Nobody in South Auckland believes when the Minister says that this is going to provide a certain number of thousands of houses that they will be able to get a house simply because under your watch the banks have made it virtually impossible for many workers to raise 20 percent as a deposit. Unless you are going to provide much more than simply saying the supply of land and the supply of houses is going to ensure that there is affordability of houses I can tell you now that that is just pie in the sky. That is pie in the sky—pie in the sky.I think that it is an appallingly bad kind of politics where you have raised this issue just because your polling would have shown that the rest of New Zealand and the rest of Auckland were captivated by the policy that we in Labour announced: the need to build 100000 houses to address the housing supply the need to address the way that house prices have been inflated by speculators the need to try to move that kind of investment into more productive investment and the need to be able to stop overseas speculators coming in and inflating the prices of houses. How on earth can somebody earning $20000 median income be able to get a 20 percent deposit on a $300000 house? There is no answer.I rest my case that despite the rhetoric and despite the spin around this particular bill this bill is not going to provide affordable housing. This is spin to try to interfere with the captivation of the rest of New Zealand when my colleague here Phil Twyford stands up and talks about 100000 houses the need to build more houses the need to reduce the prices and the need to be able to exempt first-time homeowners from the loan-to-value ratios that the banks have now imposed. That is what is needed. That is the kind of leadership that is needed. That is the kind of leadership that we need as a country if we are going to address the issue of ensuring that people who want to own their own home are able to get into a home.