Bruce Bisset: As usual, banks the only winners

Seems to me the current spate of land ownership battles are merely a foretaste of what is to come, as land becomes priced out of reach of the average person and the Kiwi quarter-acre paradise recedes into legend.

Prime movers in this disempowerment are the banks and big financiers, who are only too eager to artificially extend credit (when they deign to have it) to or beyond the limits of ability to pay - and far too quick to foreclose when those debts prove too burdensome to bear.

Far too quick, too, to dam up the money supply in the face of a (theoretical) credit squeeze, severely limiting the options for anyone caught between a high mortgage and a falling or even static income.

Bankers will try to tell you this is prudence on their part, proved good by the fact the "local" big four made near-record profits last year.

But making such profits while clamping down on lending just goes to prove banks are the only guaranteed winners in the land speculation game - winning even (or especially) when their debtors are insolvent.

The Crafar farms fiasco is a pertinent case in point. The Crafars borrowed exponentially when times were good and dairy expansion was the white gold standard, but when that galloping growth proved too quick to handle, Westpac made no apology for sending in the receivers.

On the contrary, they played it up as somehow "saving" 16 farm units from ruin - though two years on, without proper management in the interim, that the farms are now significantly degraded from what they were hardly surprises.

Mind you, I've little sympathy given the Crafars' appalling environmental record. But the point is that situation was manufactured; a bank opened a black rabbit hole for them and they fell in.

That hole has now been widened to include the country in general. The real reason government favours selling to Chinese interests is they're the only source willing to stump up anywhere near the $236 million the (Australian-owned) bank is now purportedly owed.

The fact Pengxin Group have no farming expertise and will add little or no operating value has, as Justice Miller has pointedly ruled, been conveniently overlooked for the size of the cheque.

Of course this is by no means the only case of bending or breaking the rules to do favours for our mates across the ditch.

This week's news that October's ACC levy cuts will soon likely be more than reversed in order to make the public insurer "competitive" with private ones is nothing short of a bald hand-up to the mainly Australian insurers who work the New Zealand market - and would love to have a level workplace field to play on, regardless it nobbles a scheme that for all its faults remains a world-leading universal compensation plan.

Meanwhile the housing affordability index continues to rate Auckland one of the least-affordable cities in the world - Wellington and Christchurch are also well up the list - and with current growth demand outpacing construction of new houses roughly five to three that can only get worse.

We may not sport the $100 million-plus luxury apartments of New York or London but we don't have the wealth base either.

Yet when ramshackle half-rotten villas fetch in excess of $1 million just because they're inner-city you know you have a crisis, while even a basic do-up in the suburbs is arguably now beyond anyone earning at or below the average wage.

Real estate agents bluster that things are changing and buyers will soon find the market easier ignores the fact that thanks to the cavalier lending policies of the banks back in the boom-time, prices are inflated beyond people's ability to sell - let alone buy.

The Government's attempts to create a buyer's market are shown by its mad desire to sell assets earning more than twice the cost of the debt their sale would reduce. Which plays right into the banks' cosy game, because we will have to borrow double the sale price to retain the same cash flow - and then borrow more again. But if government isn't clever enough to stay out of hock or at least keep its assets, how can it expect its citizens to?

That's the right of it.

Bruce Bisset is a freelance writer and poet.