KiwiBuild, the new Labour-led Government’s housing policy, has some ambitious targets, but with its focus on markets like Auckland, we believe it won’t have an immediate impact in Kapiti.
KiwiBuild is aimed at first-home buyers and promises to build 100,000 homes over the next ten years. Half of these homes will be in Auckland, with the remainder of the focus on regions like Hamilton, Tauranga and Queenstown. These areas are facing similar pressures to what has been experienced in Auckland.
Kapiti hasn’t (yet) appeared on the Government’s radar, despite our own unique set of challenges. Any effect here is likely to be years down the track as the eventual change in these larger markets trickles down.
KiwiBuild has a focus on medium-density housing, a concept that isn’t the norm in Kapiti. Apartments and townhouses are part of the new Ngarara development in Waikanae, but for this to be seen on a larger scale would mean more local land would need to be made available and local density rules amended by the Kapiti Coast District Council.
Looking at the bigger picture, if there are more new homes on the market (regardless of the Government’s involvement), it should slow down the growth of house prices. A move towards denser housing may also shift expectations about what it takes to get onto the housing ladder—moving beyond the quarter-acre-section dream with a standalone house.
Other tools like a Capital Gains Tax could also be on the table, and the new Government is moving to ban foreign speculators from buying existing homes, as well as continuing to clamp down on tax property speculators who sell houses within five years. All of these things combined will have an impact, but they won’t be seen immediately.
If, as a first-time buyer, you had been waiting on the outcome of the election to buy a home, it’s still very much business as usual. Kapiti house prices were up 17.3 per cent in September compared to 2016, and you still need to plan and prepare to have finance approved.
There will never be a silver bullet to immediately alter or ease current market conditions—it’s still best to talk with a trusted mortgage adviser about your options. If you are looking to buy your first home, get in touch so we can help you get on the property ladder.