The one Labour MP who understood how to fix the housing crisis isn't even a Cabinet member anymore, according to former Reserve Bank Governor Don Brash.
With prices skyrocketing and investors who already own multiple properties now dominating the market, the Government on Tuesday is expected to announce new measures to help out first-home buyers, dampen demand and increase supply.
"The biggest single problem is a political one - successive Governments have failed New Zealanders on the housing market, and have seen housing prices escalate much faster than incomes for 20 years or more," Dr Brash told The AM Show.
"And the Prime Minister's made it clear she wants house prices to continue going up. You can't make house prices more affordable by having house prices continue to rise from what are already among the most expensive in the world."
An international report last month found Auckland has the fastest-deteriorating housing market in the world when it comes to affordability. Its median multiple - price compared to incomes - is 10, more than three times above what's been historically considered affordable.
The price inflation comes after a year of record-low interest rates and disruption from the COVID-19 pandemic, the latter of which hit the overall economy hard but left the red-hot property market unscathed.
Dr Brash, who led the National Party in the mid-2000s and before that ran the Reserve Bank, says ultimately it comes down to a lack of supply.
"It has been for a long time. Ironically, the guy who most understood this in recent was the much-maligned Phil Twyford. When the Labour Government was elected in 2017, the Government said 'we will scrap the metropolitan urban limit around Auckland'. Had they done that, prices would have come down - land prices would have come down, and then house prices would have come down.
"Did they do it? No. And the Prime Minister is now on record as saying she's not going to do it."
Twyford in 2017, on becoming Housing Minister, said it was time to let the city "go up and out". At the time, the median price in the city was $855,000. It stayed around there until the start of 2020, but since then has risen to $1.1 million. Twyford lost his housing role in 2019 after the KiwiBuild scheme failed to fire.
"It is quite outrageous at the moment to pay $800,000 for 400 square metres of bare land in Flat Bush," said Dr Brash. "You cannot put an affordable house on it, no matter how small the house is. It cannot be affordable. And that's absolutely outrageous for ordinary New Zealanders."
Housing commentator and former chief executive of the Property Institute of NZ Ashley Church said Dr Brash had it all wrong - claiming scrapping the urban limit would just see rural land prices rise to meet those in the city, but that there wasn't a crisis at all.
"The problem that needs to be fixed is not rising house prices - that is not an issue for our country. The problem that needs to be fixed is making sure that the ability for first-home buyers, who are closed out of the market by those high deposit requirements, are allowed back into the market.
"The Government needs to be doing things that enable them to do that. House price inflation itself is good for the country and has been for a very long period of time."
Dr Brash said he "fundamentally disagrees".
"You cannot have house prices rise faster than incomes, several times faster than incomes, forever. If you can't go on forever, it will eventually stop. And when it stops, there will be one heck of a correction."
As for what he expects in Tuesday's announcement, Church said it would probably be "more things around basically attacking straw men".
"What I expect to see today are measures around trying to somehow get property investors, the villains, out of the market, or slow down the ability for them to buy and somehow miraculously create a market where first-home buyers are going to be able to get in. It won't work, it's nonsense and it ignores the reality of how the market actually works."
The announcement is at 9am.
