The message from the Powers to be is Clear: Invest in housing

Becoming a Landlord reinforced my long held views of real estate & the housing market and it’s wider impact on New Zealand society. In fact, it’s made me more bewildered at Long running Government (both past and present) inaction surrounding this area to tackle housing affordability and supply. I have long held the personal view that Houses were for people to live in, there were in my view never meant to be instruments of rampant speculation nor as heavily commoditized as they are today.

Apart for exceptional circumstances and from a purely selfish financial perspective, I struggle to understand why I should invest in productive enterprise over housing in New Zealand. It appears if the Business environment is good, then the housing market is good and as an ordinary joe public investor, you can also leverage / borrow against housing to amplify the impact of any capital growth (Yes. I acknowledge it’s a double edge sword and house prices can go the other way… sometimes)

This came to light upon reading that Businesses are crying out for the immigration floodgates to re-open and come increased immigration comes increased housing demand which in turn supports house prices. In addition, with the type of immigration they are after, there appears to be a depressive effect on wages as well.

I can’t see any change to the status quo (of housing been seen as a favourable investment) happening any time soon. Unless there is apetite for widespread change there isn’t going to be any if much political will to change this. There have been people who have advocated doing something and even running protests, but appears every such attempt has fizzled out.

Unfortunately, it means for the coming years, that Real Estate investing environment will continue to be favourable and perhaps it’s only when Inequality becomes crippling, we enter into another period of neo-serfdom, that the steady “Bread and circuses” diet of commercialized entertainment, professional sports and public spectacles are no longer enough to the placate the masses, and the populous have nothing to lose by revolting, then may be, just may be at that point we will see change.

The message from the Powers to be is Clear: Invest in housing

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