The latest Massey University Home Affordability Study shows that home affordability in only three of the twelve regions covered has deteriorated. It isn't surprising that two of these areas are Auckland and Canterbury. The third region is the traditionally high cost area of Queenstown lakes.
Of the other nine regions, seven had affordability improvements with two remaining stable.
While the Massey University study clearly shows that there is no affordability crises in New Zealand, rental affordability is set to become a major problem for tenants if tax changes proposed by some political parties are put in place.
"It is currently $135pw cheaper to rent than own the average New Zealand home" says NZ Property Investors’ Federation Executive Officer, Andrew King. "People need to realise that the extra taxes being proposed are going to have a dramatic effect on a tenant’s ability to save a home deposit and will lead to overcrowding for many families.”
People think that a Capital Gains Tax (CGT) is aimed at property speculators. Many are surprised to learn that it would cover businesses, farms, investments and shares as well.
"The capital gains made by property speculators are already taxed under current law and Inland Revenue has a well-funded and successful property unit to make sure they do pay their fair share of tax" said King.
The property related group that will be most affected by the CGT is rental property owners.
“When a CGT is combined with Labour’s other policy to ring fence rental property losses, it will lead to significant increases in the cost of providing homes for tenants,” said King.