Auckland Housing Affordability

[Perry]

Housing supply still key to curbing Auckland property prices: Blenglish

Finance Minister Bill English has welcomed the Reserve Bank's move to curb housing prices in Auckland,
but warns that "unsustainable" price increases will only be resolved through greater supply.

[eri]

The measures include:

• Requiring non-residents and New Zealanders buying and selling any property other than their main homes to provide a New Zealand IRD number.

Requiring non-residents and New Zealanders buying and selling any property other than their main homes to provide a New Zealand IRD number.

• Requiring non-residents to have a New Zealand bank account to get a New Zealand IRD number.
• Including a new" brightline test" to tax gains from residential property sold within two years of purchase, unless it is the seller's main
• home, inherited or transferred in a relationship property settlement.
• IRD would get $29 million extra funding to enforce the changes, which are subject to consultation and take effect on October 1
  
  http://www.stuff.co.nz/business/6861...verseas-buyers

[chrisgoh]

"They are aimed squarely at ensuring that property buyers – including overseas speculators - who buy residential property with the intention of selling for a gain pay their fair share of tax as required by the law"

"The changes will be subject to consultation and take effect on 1 October this year. The “bright line” test will apply to properties bought on or after that date"

Does not affect long-term investors who provide accommodation need to tenants. Good and fair system to control excessive speculation while ramping up supply.

[Courham]

Agreed Chris- and about bloody time!

Craig

[flyernzl]

Looks pretty much like what should be happening under existing tax law.

So its not really a CGT, though it will be sold as such.

Wonder what happens if somone buys/sells and makes a loss? A tax deduction?

[Perry]

Hosking hit back video.

[Davo36]

Succinctly put by Mike.

I must say it's quite heartening to see so many lay people now getting stuck into the council. It's no longer a hidden problem, it's right out there in the media for all to see. And sunshine is the best disinfectant, so hopefully we'll see some better service from the councils around the country in due course.

[eri]

and as uk blair found

there's a point

where too many spin drs

spin you into oblivion

[drelly]

Looks pretty much like what should be happening under existing tax law. So its not really a CGT, though it will be sold as such.

That's what I thought too.

Wonder what happens if somone buys/sells and makes a loss? A tax deduction?

Yes, I think it would carry over to be offset against future earnings.

Has anyone considered that perhaps Auckland property doesn't need to be "affordable" on a national level. I don't know of any major first world city that has "affordable" property for the average person.

[PTILoveYou]

It's the same income tax on property traders.

The difference now is IRD can just automatically ping anyone buying and selling within two years, and the properties involved are not owner occupied or relationship property.

If someone made a loss on the trade, yes the person can make claim tax losses, same as before.

Market dictates prices.

If anyone want affordable housing for every body, bring forward Communism!

[PC]

Property traders will just have to do one house at a time.
Live in it for a bit before flogging off their "PPOR".

Just another stupid arbitrary rule.

[PTILoveYou]

Property traders will just have to do one house at a time.
Live in it for a bit before flogging off their "PPOR".

Just another stupid arbitrary rule.

There are property traders doing this previously that have been caught by IRD already.

[donthatetheplayer]

Property traders will just have to do one house at a time.
Live in it for a bit before flogging off their "PPOR".

Just another stupid arbitrary rule.

I had a coffee with a chap last week who openly told me he was doing this... I didn't ask if he was paying tax but the way he described it made me assume he wasn't. It was high end properties too! I assume he is making $100k +/- every couple of years, tax free.

[PTILoveYou]

I had a coffee with a chap last week who openly told me he was doing this... I didn't ask if he was paying tax but the way he described it made me assume he wasn't. It was high end properties too! I assume he is making $100k +/- every couple of years, tax free.

IRD will catch him once he has established a pattern, and then the penalty interest (after a number of years) will be glorious!

[Perry]

Reserve Bank And Gov't Measures Won't Stop Foreign Investors
May 18 2015

The Government and Reserve Bank have stepped up efforts to cool the
Auckland housing market, but critics say it won't stop foreign
investors fuelling the fire. On Sunday, Prime Minister John Key
announced a law change to firm up and better enforce the existing
capital gains tax on speculators. The Government's law change will
require foreign buyers to register for an IRD number and have a New
Zealand bank account, meaning data on their numbers will finally be
collected. The Reserve Bank is also moving to force Auckland investors
to front up with a 30 per cent deposit, while relaxing rules outside
the country's biggest city. Auckland property investor Rafiq Moses
says cashed-up foreigners are the main competition for local landlords.

Rule Financial Services mortgage broker Simon Rule said it would have
no effect on cashed-up foreign investors borrowing cheap money in
their home countries. New Zealand was one of only a few countries in
the Asia-Pacific region with no restrictions on foreign property
buyers, he said. "Every other country, Singapore, Malaysia, Australia,
they've all blocked or severely restricted non-residents from owning
properties, because they've seen the impact on their markets. Why are
we still doing nothing about it? It's mad."