The moves will help curtail house price inflation but, except for KiwiBuild, won't add to the amount of housing stock, said David McLean of Westpac Bank.
Greg Lowe of Beca said "these have been sensible and practical moves". A tourism boss said the issue was supply of housing. "Fix that and the issue will resolve itself."
Don Brash of ICBC NZ Bank believed the moves might help at the margin but the real issue was reforming the way local government constrained land supply and delayed the consenting processes — as the Productivity Commission pointed out some years ago.
"The Speech from the Throne contained a pledge to deal with these issues. To date, progress has been slow," he said.
A developer said the moves would not only affect prices but some of them would make positive structural changes to the market.
"I don't think the foreign buyers ban will have a particularly big effect but the extension of the bright-line test will limit purchase for pure capital gain and hopefully encourage those who do invest to buy with a long-term horizon," she said.
"KiwiBuild will encourage the market to provide options in the less unaffordable range. New builds under $650,000 have gone from being 50 per cent of the market in 2010 to 5 per cent in 2018.
"Anything which encourages a change in this is a positive thing for availability of affordable supply," the developer said.
An ICT boss said though the changes might alter the demand side, it was the difficulty of providing supply that would be the problem. Scarcity of skills, lack of affordable build-ready sections, consent delays and construction cost inflation conspired to frustrate the Government's objectives.
A banking chief agreed, saying lack of supply was the big issue and the Government was doing little to address the regulatory issues driving this. "KiwiBuild was just reshuffling the deck chairs."
An exporter said that to some degree, it was a shame foreign buyers were not constrained a lot earlier. "If all the properties owned by foreign buyers were in New Zealand resident hands, there would be enough accommodation for those not in houses, the house price bubble wouldn't have been so big and housing would be more affordable."
However, Matthew Cockram of Cooper and Company NZ said the foreign buyer ban was xenophobic nonsense: "little more than window dressing and shameless populism."
A shipping boss said banning foreign buyers would not affect the right parts of the housing market. New Zealand needed foreign investment in the housing market.
An energy boss liked the bright-line test extension but said the Government still hadn't dealt with net migration as promised at the election, or the costs of housing materials, labour productivity and land .
A company chair said net migration was the biggest driver of housing demand but the dilemma was the need for migrant workers.
Auckland house prices
The chief executives are not convinced Auckland house prices will follow the trend of major Australian cities and experience price drops.
Anne Walsh of Global Everyday Marketing said until the supply of houses exceeded demand, prices would hold at their current level. They would only drop when:
● the number of houses are in excess to needs, and consumers choose not to buy at the higher prices
● there are changes in the tax structure, for example depreciation, and capital gains taxes on residential investors
● the Reserve Bank imposes income versus long level requirements for banks, for example 3.5 times as in Europe
Beca's Lowe weighed in, saying increased supply would cause a plateau in prices "as we have seen in past growth periods".
An ICT boss said if immigration continued at its current lower level and nothing much happened to improve regulatory bottlenecks, the continued high construction cost inflation of 8-10 per cent a year, compounded over time, would raise the cost of newly constructed homes. "This will have the effect of providing a floor to any potential price decrease of existing homes," he said.
A legal firm boss said a drop in prices was a necessary correction. "This is the only way housing is likely to become more affordable. The longer we wait the worse the correction will be."
An agribusiness chief said prices were overheated and would fall, causing pain. "It is inevitable as they are far too high."
Roger Partridge of the New Zealand Initiative said the greater evil was pricing New Zealanders out of the housing market, hindering labour mobility and high rents, causing poverty.
Housing workers
Nearly 40 per cent of CEOs agreed pressure was increasing to retain and attract workers in Auckland because of a lack of housing availability at affordable prices. In some cases this was leading to higher wage demands.
An energy boss said this was increasingly becoming an issue for lower-waged employees living in Auckland. Travel times and distances were a related factor.
Another energy chief said "it's a very big issue for us in Auckland to both attract and retain employees. The lifestyle proposition is challenging in Auckland and this is also fuelling wage pressure."
A law firm boss said "we have specific examples of people who declined roles in Auckland because of the housing cost," while an agribusiness chief said the house prices were driving wage growth demands significantly.
