Two solutions to tackling the housing problem resonate in the boardroom. Seventy-two per cent of CEOs like the sound of educating young New Zealanders to start small with housing while 66 per cent want to see the introduction of loan to value ratios (LTVs) - a move that will force buyers to find high deposits before being able to get a mortgage. Requiring LTVs is currently under consideration by the Reserve Bank, but there is evidence banks are already tightening mortgage requirements.
Surging house prices, particularly in Auckland, mean New Zealanders are increasingly unable to afford a home of their own. Things are even worse for young people attempting to buy a first house.
The problem is both economic and political: until earlier this year there was an impasse between government and Auckland Council which didn't help matters as building in the nation's largest city fell way behind demand. Now the two have agreed to fast-track new developments.
National Party policy depends on freeing up land for building and removing bureaucratic barriers; Labour promises to build 100,000 new homes for the less well off. Port of Tauranga chief executive Mark Cairns believes in changing expectations. He says: "My first house cost around $90,000. I had to save 25 per cent deposit and interest rates were around 18 per cent. That was all I could afford."
Bosses like Craig Stobo (LGFA) Rod Drury (Xero) and John Williamson (Hellaby) advocate getting people away from Auckland into other centres. Williamson wants to see a government population or demographic plan which can attract or direct internal migration and industry towards other smaller cities. Don Lyon of Beca warns against applying a national solution to what is a regional problem. He says ideas relevant in Auckland don't make sense in provincial centres with ample land.
