Wellington, New Zealand – Stricter rules for real estate investors and speculators went into effect in New Zealand this month as part of the government’s efforts to address the deepening real estate crisis in the country.
Under the new law, real estate investors can no longer deduct mortgage interest from their taxable income
It seeks to focus on restoring the primary role of housing as an owner-occupied property rather than a financial asset, and to address the country’s housing shortages, rising house prices and homelessness.
The move follows a 145 percent surge in property values ââover the past 10 years, according to the Real Estate Institute New Zealand. Rent prices have also risen – according to Statistics New Zealand by 37 percent over the past 10 years.
In 2018, 42,000 people in the country were homeless or in temporary or shared accommodation, and figures from the Ministry of Social Development suggest that more than 23,000 people are on the public housing register.
The catastrophic situation has already caught the interest of the Human Rights Commission, which announced in August that it would conduct a nationwide housing survey.
Senior Human Rights Commissioner Paul Hunt says that for the past 50 years, successive governments have failed the New Zealand public.
In the 1970s, there was a royal commission of inquiry into housing that resulted in the creation of a national housing council that was disbanded just 10 years later.
“In retrospect, this was an important body overseeing the growing problem,” he said. âWe took our eyes off the ball and left everything to market forces.
“The Human Rights Commission is not advocating a public or private approach – that is decided by the government of the day, but whatever approach is taken, it has to deliver, and in recent years there has been no doubt that it has failed.”
Traditionally New Zealand has been actively involved in drawing up international human rights law – including the right to a decent home – but bringing those rights home has not been so good, he says.
“These treaties have been ratified, so they are legally binding, but somehow there is amnesia when politicians and officials fly home across the Pacific,” he said.
âThe right to a safe and decent home is vital to wellbeing. Without a decent home, it is very difficult for people to be active members of society. “
Al Jazeera spoke to a number of New Zealanders about their housing experience.
Jim * was living on the streets of Wellington, the capital of New Zealand, when Al Jazeera spoke to him. He had been homeless for more than two weeks but was hoping to move to another part of the country with his family.
Jim has been on sick leave since he was hit in the back of the head with an ax five years ago, he says. He cannot remember the circumstances that led to the accident other than waking up in a hospital where he was told that he was lucky enough to be alive.
He had moved in and out of public housing since the accident, but it has proven difficult to get permanent financial aid as he is never able to work due to his head injury.
Jim found himself without a roof after a stay in half a house came to an end.
It was his first time on the street, but he said people were helpful – they provided food, showered daily, and the homeless were hospitable.
âYou really just want to be left alone and not bothered. I take it day after day. I have good shoes, a blanket and I feel as comfortable as possible. “
25-year-old engineer Benjamin Duyvesteyn moved to Raglan, New Zealand’s North Island for two years, but moved into a tent in April 2020 when his relationship with his brother deteriorated.
Having a number of odd jobs and no vacant rooms in raglan, he says he says 200 and 250 New Zealand dollars ($ 138.65 and $ 173.33) a week to live in a “shoebox”.
Duyvesteyn ended up living under canvas for 10 months.
âIt wasn’t great. I’ve definitely had better times in my life, âhe told Al Jazeera. âThere was no washing machine or hot water on the campsite. It was freezing over the winter. I would use a city laundromat to wash my clothes. I would use a battery to charge my phone. When it rained, I couldn’t dry myself off before going to bed.
âThere were rats the size of cats. I once found a rat in my tent, so I practically lived out of the grocery store and bought every meal every day. But it was something I had to do. I worked full time, so I saved a little bit of money. “
Duyvesteyn moved in with friends in early 2021.
Kelly Jayne Ferry
Kelly-Jayne Ferry and her two daughters had been living in the Mount Victoria area of ââthe capital Wellington for three years when their property manager gave them 42 days notice that the lease would not be renewed.
“I am very sad to have to leave our home,” Ferry told Al Jazeera. âAfter renting for so many years, I have a constant fear in the back of my mind that we might have to move again soon, which means that I’ve never really invested in a nice apartment.
Finding a suitable and affordable place near the girls’ school is sobering, she says.
“I was blown away by the lack of consistency between price and quality,” Ferry told Al Jazeera. âIt’s depressing. You can see a house that is peeling paint, the walls are dirty and has not been done on in 50 years, and has little sunlight. And then you see a place that is a beautiful sea view apartment and the same price. Where is the limit and how does it work? “
Ferry found few properties available and that the listing was generally designed for young professionals who could pay up to $ 300 New Zealand dollars ($ XXX) a week for a room in a house or tiny apartment.
Landlords often push the envelope, says Ferry.
âI really feel sorry for people who don’t know the law or who don’t have the confidence to speak out. But even if you do get in touch, there is always the possibility that you are endangering your well-being and the safety of a home because you gave them a reason to challenge you by challenging them, “she said.
Ferry’s move was delayed due to COVID-19, but she and her children have now found a warm and dry home in Roseneath, a suburb of Wellington.
“So life is good until we have to move next time!”
Rachel Lydia Barker
Freelance video editor Rachel Lydia Barker, 26, has spent her adult life renting apartments or houses, but now lives with her parents in Wellington due to COVID-19.
Barker comes from the middle class and is relatively wealthy.
She inherited some money from her grandparents and her parents have been saving since she was born, but despite “great help” the cost of living relative to house prices cannot afford to buy a house in town.
Barker says it would be cheaper to take out a mortgage than rent it, but it definitely won’t save enough money on a deposit. “Of course I would rather pay off a mortgage than pay the same rent, with the possibility of being pushed out at any time.”
She plans to go to Australia to see her sister who has just bought an apartment in Melbourne. Barker’s sister realized that she would earn significantly more abroad and after two and a half years secured a bail in addition to supporting her family.
âMy parents are pretty heartbroken. You are English and have decided to move to New Zealand for a better quality of life. I was eight years old at the time and New Zealand used to be a paradise. In many ways it still is, but the cost of living is always more similar, if not higher, than in cities like New York or London – without some of the advantages these cities have to offer. “
Nigel Mander, a former professional clown in his sixties, has been renting out since his mother’s death 12 years ago.
After traveling the world, he moved to a rundown shop and lived there for five years. âI didn’t make it too public because I didn’t want to get sidelined with it [municipality]. There was cable and water damage, the roof was leaking, but it was cheap and it worked until the owner kicked me out. “
Since then, Mander has lived a temporary life, door-to-door at the mercy of various landlords and friends, but he says he has no regrets.
âMy life situation was not very stable and it leaves me with a subliminal feeling of insecurity, but I won’t let that get me down. I tend to ignore caution and continue anyway. I’ve never been a saver and I’ve traveled a lot.
âWe have to change people’s attitudes towards living. It shouldn’t be about owning your own lock or having real estate as an investment, but if you have a guest room or a replacement home, there could be people – and lonely people who could use the company – who would appreciate the accommodation. The community aspect is missing, I think.
“There are certainly enough houses to walk around, but when greed comes into play, when people decide to own 20 houses or keep them empty because it is less stressful to rent them out, I have a problem with that.”
The writer Murdoch Stephens, 40, has lived in a rented apartment since he was 18.
In the spring of 2019, he was sharing an apartment with five others in Mount Victoria – one of Wellington’s more affluent suburbs – when the area hit the headlines following a “monster rat” infestation.
At that time he had problems with the apartment – the rent had risen by 18 percent and there were infrastructural problems, but he could not reach the landlord. It became a joke that the landlord might have been a giant rat who lived in the garden, which became the premise for his book Rat King Landlord.
âWhat we are not talking about are the subtle consequences of the housing crisis; People who stay in relationships that they shouldn’t have because they are afraid of changing their situation in life, or fragmented communities because, for example, people commute from suburb to suburb.
“As a writer, you don’t make a lot of money in the best of times, but what I’m most concerned about is younger people who are increasingly unable to pursue a creative career because it is not an option for livelihood.”
Stephens is not interested in denigrating landlords or politicians, or personalizing the subject. The housing problem is structural and will require a paradigm shift in thinking to solve it, he says.
âEveryone falls short in this environment. We have neither the language to change it nor a language that articulates a collective reaction. “