KEY POINTS:
A housing boom that just won't quit has business leaders worried. By a ratio of two to one respondents to the Mood of the Boardroom survey say they are concerned about the affordability of housing.
Their concern is understandable. Five years of house-price rises have turbocharged consumer spending through the wealth effect, which has people borrowing and spending on the strength of their rising housing equity.
It is one of those good things you can have too much of. It has resulted in an economy seriously off balance, with spending growing faster than incomes and demand growing faster than the economy's ability to meet it.
The upshot is high interest rates and a sky-high dollar.
And with buying a first home out of reach for more people, they have one more reason to head for the airport departure lounge, compounding labour shortages.
Chief executives are split almost 50:50 on the merits of one measure mooted to cool the housing market - a capital gains tax on investment properties.
Gains people make by trading in investment properties are already taxable and, as a signal to the next commissioner of Inland Revenue and more active property investors, the Budget boosted funding for enforcing that provision.
Respondents were also split on the suggestion of getting rid of interest deductibility on investment properties. That would be a dramatic change to the tax laws.
But a milder option, dealing to negative gearing by ring-fencing operating losses from investment properties so that they cannot be offset against other income, is something officials have been looking at.
As far as moves to expand the supply of housing go, respondents recognise that house-price inflation is largely land-price inflation and are more than two to one in favour of making more land available for subdivision. A similar proportion are against more investment in state housing.
On the demand side, proposals to limit offshore ownership of properties or have a higher interest rate for investment properties find little support.
Respondents also come down against limiting banks' ability to offer loans for 100 per cent of the value of a property, by a margin of two to one. A similar proportion oppose cheap loans for first-home buyers.
The consensus seems to be that the market should be allowed to work as freely as possible.
They are strongly in favour - by more than five to one - of moves to make investments other than housing more attractive.
One of the drivers of the market is the conviction that the best way to accumulate wealth for your retirement is not to save through vehicles such as superannuation schemes, but to borrow money and buy housing.
That is a rational response to the contrast between the tax laws' longstanding lenient treatment of housing on the one hand and stringent treatment of other forms of savings, such as superannuation, on the other.
National Party leader John Key has indicated he would prefer to see the playing field levelled by making other investment options more attractive rather than making housing less attractive, though he has not suggested how.
And Finance Minister Michael Cullen would no doubt say that the Budget's moves to boost KiwiSaver, with other recent tax changes relating to managed funds, do just that.
Small businesspeople see things pretty much the same way as the big end of town, except that far more - 78 per cent - oppose a capital gains tax on investment properties.
