Home Affordability Not Just About Prices – But Incomes say CTU

“Home affordability is not just about house prices – it is also about incomes, and the Council of Trade Unions submission to the Parliamentary Inquiry into Housing Affordability says that the Select Committee should also look at the problem of low pay,” CTU Economist Peter Conway said this morning.

"In the three years prior to 2007 house prices have increased by 38.5% while at the same time wages have gone up by 8.7%, so if house prices are outstripping wages by 4 to 1 then it's no wonder that home ownership is increasingly out of reach for low and middle income New Zealanders."

“The CTU does support a capital gains tax on investment housing and our submission also suggests introducing stamp duties for higher priced houses and removing the offsetting of expenses for rental properties against income.”

“The submission also focuses on improving the supply of affordable housing through subsidised home lending programmes, shared equity, more state housing, affordable housing quotas, and higher investment in skilled labour for residential construction.”

“The CTU says that migration is a driver of house prices and that is why it is important for employers to look at ways to improve their use of labour and lift productivity through more technology, better workplace practices, and more investment in upskilling the current workforce rather than rely too much on migration. However the CTU does not support any blame being attached to migrants and believes that the main focus should be on lifting incomes and improving the supply of affordable housing,” Peter Conway said.

The CTU’s submission is available for download here: http://union.org.nz/policy/housing-affordability-June-07