National Party leader Christopher Luxon’s promising to make legislative changes to help the rental housing market.
Luxon tells Mountain Scene the private rental market’s been ‘‘incredibly frustrated’’ by the government’s policies around interest deductibility and the bright-line test — which, essentially, means if you sell a residential property within certain timeframes the vendor may have to pay income tax on any gains.
‘‘We’ll pull the bright-line back from 10 years to two years, and we’ll restore interest deductibility, because it’s a legitimate business expense,’’ he says.
‘‘Rents across the country have risen by about $150 a week under this government and I think a good part of that can be attributed to the interest deductibility and the bright-line test, which are big disincentives for landlords to rent houses — they add a huge cost and drive up the rents, which makes it very difficult for people to be able to afford them.
‘‘If we can get that private rental market working, with good mum and dad investors as it was, I think that would be very helpful.’’
Arrowtown-based regional economist Benje Patterson’s recent report on the housing market found, based on new homes consented, and factoring population growth, there were more than 1000 new homes consented than were needed last year in the Queenstown-Lakes — over the past three years, that number’s 2157 homes.
Despite that, Luxon believes creating more housing supply is key to solving the rental housing crisis.
‘‘If people can’t afford a home, then they drive into rentals, if they can’t get into rentals they drive into state housing and social housing and, ultimately, emergency housing.’’
While he appreciates there are ‘‘dwellings available’’ in the district, he maintains the issue is there’s not enough affordable housing for people in Queenstown, for example.
‘‘You think about all the hospitality workers we desperately need here, think about all the teachers, police officers, nurses, people who have good jobs on average incomes, it’s really difficult to be able to get ahead and find good, affordable accommodation.
‘‘You’ve got people with very expensive homes here, that are holiday homes … [and] I’m sure that if they were charging the rents that they need to charge for them, you wouldn’t recover that cost anyway.’’
Luxon says, short-term, build-to-rent products are a big part of the solution, but long-term, there has to be a single-minded focus on building more houses.
