Salvation Army weighs in on affordability

Access to safe, decent, affordable housing is the single biggest issue facing hundreds of thousands of Aucklanders, according to a report from Salvation Army social policy analyst Alan Johnson.

Thursday, August 30th 2012, 12:00AM

by The Landlord

His report on Auckland’s housing said the lack of affordability was caused by Government unwillingness to tax housing and the Reserve Bank not reining in mortgage lending over the past decade.

It said the housing boom had distorted household balance sheets, raised foreign debt unnecessarily, and reduced the ability of domestic capital markets to fund growth and development.

It said the Government had forecast a shortfall of 90,000 houses by 2031 in Auckland and called for an agenda around inequality, an Auckland housing plan and for legislative change to allow things such as zoning for affordable housing.

Johnson’s report said that not only were house prices excessively inflated, but higher and higher subsidies were required for low-income people to afford housing.

“Any ambition Auckland has to become the world’s most liveable city will be defeated if the housing future being offered by current trends continues to play out.”

The Ministry of Social Development’s recent incomes report showed than in 2011 a quarter of the population lived in households where housing costs made up more than 30 per cent of income. That is up from one in 10 in the late 1980s.

More than one in five people aged between 45 and 64 have housing costs of more than 30 per cent of their income, compared with just one in 20 back in 1988.

Johnson’s report said the sort of taxes that had previously been politically unpopular would have to be considered to make housing more affordable and reduce inequality.

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