1 October 2013

First home buyers need Progressive Ownership

Young families looking to get into homeownership are being shut out of the market by the current Government’s policies and need the Greens’ Progressive Ownership scheme to help them get into their first home, Green Party Co-leader Metiria Turei said today.

Figures in the NZ Property Report released today show that house prices have risen by 8.7% in the past year, more than four times the 2.1% increase in the average weekly wage over the same period, to a new record. National has refused to introduce a government-led programme of affordable house-building and has allowed the Reserve Bank to introduce Loan-to-Value Ratio (LVR) rules with no exemption for first home buyers.

The Green Party is proposing the Progressive Ownership scheme to complement a government-led programme of affordable house-building. Progressive Ownership gives families an affordable pathway to home ownership using the Crown’s low cost of capital. Families pay a basic ‘rent’ to cover the Crown’s capital cost in the house and make additional payments to fit their budget to buy equity until they own the house outright. This is a lower-cost, mortgage-free alternative.

“House prices are increasing at over four times the rate of wages and the current Government has no answers for young families wanting to buy a home,” said Mrs Turei.

“National failed to protect first home buyers from the introduction of LVRs. The Government’s tinkering with the Kiwisaver deposit subsidy and Welcome Home loans will have little impact. Weakening planning rules just means more costly sprawl and the housing that will be built will tend to be high-end, rather than affordable. While National dithers, house prices are getting further and further out of reach.

“New Zealanders need a stable housing market and an affordable pathway to home ownership.

“Successive governments built affordable housing and passed their low cost of capital on to first home buyers through State Advances. Those policies led to our once world-leading rates of homeownership.

“It’s time to go back to what works. The government needs to lead the building of affordable homes, which the market is failing to provide and the government needs to give young families a hand-up through the Greens’ Progressive Ownership scheme.

“Progressive Ownership makes owning a home truly affordable for young families. By passing on the Crown’s low cost of borrowing, Progressive Ownership is cheaper than a commercial mortgage with greater flexibility and no risk of default. It’s a modern version of State Advances. It’s time the Government joins the 21st century and gives Kiwi families a real chance to own their own home again,” said Mrs Turei.

Additional information:
Green Party Home for Life package including Progressive Ownership

ENDS

© Scoop Media

Trial Over 'Anonymous' Donations: John Banks Resigns As Minister

ACT Leader John Banks today confirmed that he has stood down from his Ministerial positions following today’s decision at the Auckland District Court.

“Last week I indicated to the Prime Minister’s Chief of Staff that I would offer my resignation should the matter relating to my 2010 Mayoral Electoral return be committed to trial,” Mr Banks said...

“I intend to continue in my role as ACT Leader and MP for Epsom, and ACT will continue to support National on matters of confidence and supply. More>>