Mike Hosking: New housing laws are a mistake and xenophobia is to blame

Opinion

There is a sting in the tail over the changing of laws around foreign house ownership in this country.

Having perhaps seen the Australian experience, the government has upped the anti and basically banned everyone and everything.

Originally, as I understood it, the plan was to stop foreigners buying existing houses. They could build, the argument being at least they added to supply. Australia did the same thing, but found out quickly that by and large, nothing changed. Those who wanted a slice of the action simply built.

So what's new? Well those who want to buy from off -shore not only have to build new, but having built, have to sell it in 12 months.

So what does that mean? Foreign money is gone. Is that bad news? You bet it is. It's a mistake, and a big one.

We are not a fortress. We are the country of free trade, open access, limited borders and barriers. Why? Because we need the world, the world doesn't need us.

Now here's the dichotomy. This, among some, perhaps even many, will be a popular move. Foreigners buying land and housing is an emotive issue, sadly driven by xenophobia. We are anti-Asian.

We should of course be embarrassed about it, but we're not. We're jealous, we see foreign money and blame them for the so called unaffordability of some parts of the country.

The reality, of course, as has now been proven by the statistics, is that the cost of a house in key parts of the country is not about foreign buyers, but the extraordinary success of the economy and the large influx of migrants required to make this country grow and tick over.

So what will the outworkers of this government move be? The money for new house builds, apartment buildings, and new developments will vanish. Why on earth would you bother? If your money can be invested anywhere, why invest it where its hard, and it's increasingly not welcome. So not only are we short of housing, a source of income to expand it goes west - probably literally to Australia and beyond.

So who replaces that loss? Us - the locals? The same locals who complain incessantly that large tracks of land go offshore because we can't afford it? It makes no sense.

This is the government at its most naive and delusional. It is a sop, based on race and no common sense or clear thinking. They're not going to be able to build their 10,000 houses a year or anywhere close. They're going to drive money out of the country. They are closing the doors, drawing up the moat bridge, and sticking the sign out: foreigners naff off. It leads nowhere good.