Another day, another housing scapegoat

 

Did you know that seventy-five percent of statistics are made up on the spot? Ninety-nine percent, if you’re a politician.

Politicians are responsible for Auckland’s housing crisis, politicians from both parties who enacted, voted in, then locked in the sclerotic rules restricting the supply of land and the building of new houses. What they all need now and what they’re all so desperately looking for is a scapegoat, and a unicorn.

The unicorn arrived, they still hope, in the shape of the Unitary Plan. The search for scapegoats continues.

Today’s scapegoat, in the latest scare-story to emanate from the office of Labour’s housing spokesman Phil Twyford, is folk who own several investment properties who are “snapping up Auckland’s houses” – especially, says Phil, a “group of multiple property owners [who] have increasingly swallowed up more of the city's houses over the last four years, mostly at the expense of people looking for their first home.”

Data compiled by Core Logic shows the share of Auckland houses being bought by people with five or more properties has grown by 40 per cent since 2012, after remaining steady for the previous seven years…
    In the year to date, people with five or more homes have bought 3451 additional houses, or 14.8 per cent of all houses sold in Auckland. That compares to 10.7 per cent in 2012.
    Labour's shadow housing minister Phil Twyford said the data showed that speculators had been allowed to "run riot" in Auckland, at the expense of first home-buyers.
    "Since 2012, when the market really started to heat up, we've seen a 40 per cent increase in sales going to investors with five or more properties."

That’s outrageous! 

Or is it?

Because even by the argument Mr Twyford is trying to make, the crucial divide is not between multiple-property owning investors and everybody else, but between investors and everyone else – and as you can see from the red line below, if there’s been any “swallowing up” recently it hasn’t been at a rate markedly different than before.

In other words, Mr Twyford’s difference is a difference that makes no difference.

Even if it did get him a headline.

Oh, and on this one the Property Investors Association is right: it actually is good for renters if investors were snapping up much of what goes on sale. The good rental supply is one of the few areas in which the housing market actually is able to work—and one of the main reasons the price to rent a home has not (so far) achieved the stratospheric heights of the price to buy it.

Small mercies.

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