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Demand on housing outruns supply—when will that stop? What political party drives the housing programs after years of negligence? What is the deficit called between government spending and taxation and who pays for it?



NZ’s Housing Culture

Home Ownership with a Twist

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Housing demand outruns supply—when will that stop?


Over and over again, we are bombarded with every days “noise” about house prices and commentaries about unaffordable housing, consumer index and debts. The shortage of housing and price hikes are good for the HAVE GOT but very bad for the DON’T HAVE ONE.  Who is competing with willing buyers, if unaffordability is the real reason? If you look very carefully at prices of newly built homes, what number is the problem — the value of the land or the building?  When the land value went up in some areas by 300% who should answer the burning question?


But that is not all if you look at people’s debt levels, inflation rates and growth of population. What ever your view is, you cannot bypass house hunter’s problem; either the property value is out of reach or being outrivaled by competing buyers. True, New Zealand’s houses are among the world's most expensive ones considering Kiwi families’ income due to  economic limitations and the distortion of demand and supply. It has little impact on which political party drives housing programs after years of negligence. NZ has limited resources of builders and money for developers and taxpayer’s funding. What do you think who pays for increasing government debts?  The deficit between government spending and taxation is paid by NZ’s citizen. They call it inflation, however it is for the government a hidden tax and nobody can escape before death. Think about.




Who will fix the housing crisis?


The market has a lot of healing power say optimists. When people’s income doesn’t support getting finance or  the asking price is out of reach of willing buyers, developers and sellers have to drop their expectations. True, however a global finance market is a much higher risk than local policies. In 2007 the begin of the GFC was a good example.


If you are interested in what is going on and learn about how the financial world works, you can put yourself in the correct position to benefit from any housing market. The

financial system is not hidden but its complexity puts people off trying to understand how to use it. Just start to take control of your financial position and you will fix your housing problem as well. Trust. It works.


How do other countries deal with housing policies? In debt driven financial systems the  housing markets swing between boom or bust. In policy driven housing markets homeowners are stimulated by tax incentives for example to meet new standards for energy efficiency. When homeowners modernise their houses everyone wins. Germany is very good in managing the housing stock. NZ prefers to use a “stick” intensifying boom or bust. Examples — watch the pre-election campaigns for next year’s election.




Housing culture with a twist


Years back when I was looking for a house in Wellington, it was difficult to find one as it is right now. I could only afford the worst house in the street - a cold, damp bungalow exposed to the wind-chill from the south. We didn’t wait for long starting a step-by-step renovation, when people asked “do you want to sell?”  Since I know why people wait with renovations.


Grown up with a different mindset — why would I accept living in a sub-standard house from the 70s? To cut the story short we started with a new roof, proceeded with double glazed windows, modern bathroom and kitchen, central floor heating and finished with solar electricity after 5 years of renovation. And then the comments, this poor guy has “over capitalized” his property… Well, our home is our life, why would we compromise  our life?


In the meantime as property investor I have seen so many over valued properties in the original state of the 40s, 50s, 60s and 70s. NZ’s poor housing  are not a exception. Attempts by politicians to change that by targeting curiously rental homes only, do not have the acceptance needed to make a difference so far.


As you read here owner-occupied housing is a huge financial commitment and the only "investment" that does not generate income, but creates bills people struggle with”. The debates concerning financial gains are based on tax free capital gain, not realizing that the payments to the bank (fees and interests) and costs to upgrade a property outperform often capital gains. To avoid that, people house in a bygone age.



Home ownership and handmade gifts


It is not a secret that homeowners have to work harder and reduce consume. Possibly you know friends and colleagues like you who got onto the property ladder, but others did not. Why perform some people better than others by similar income and conditions? The answer is related to attitude. It is people’s way of life utilizing resources, space and time.


When looking at other people’s properties, you will see some sections are organized in functional areas like a play ground,  herb or vegetable garden, etc and  others are completely surrounded, let me call it bush-land.  Families spend time and work together or not.  Think of doing something in the garden with healthy and tasty results, pursuing hobbies or have no drive at all. The point here is, habits can be valued in money, too.


Some people have the resources for being creative e.g. using rain water or sun energy available for free, making handicrafts or handmade gifts, or a hobby that pays for itself—where is the limitation? Doing something is a great way for building relationships or bonding with kids and developing skills.



Take Away

You can’t change the housing market or culture, but you can choose how to respond to it. The link between home ownership and resources for a better life is YOU.

Personal achievements have positive side effects, they boost confidence and happiness something you cannot buy or get from the television screen. Make the best out of your home for the benefit of your life and family - it is about attitude. Good luck.



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Klauster Blogs lead to a real person, IT professional, investor, landlord and business owner with interests in technologies, residential properties and healthy lifestyles. 


The passion of making experiences available comes from renting in different countries and working with people who are interested in home ownership. Helping people to avoid pitfalls has been most rewarding, when forming relationships.


Our philosophy to treat life, partnerships and hobbies as an investment has helped people in our circle. Life is a dream with a deadline, happiness comes from making the right choices by having realistic expectations.


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