Literature Review

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Table of Contents Executive Summary…………………………………………………………………………… Introduction……………………………………………………………………………………. Literature Review……………………………………………………………………………… Background of Housing Crisis in New Zealand ……………………………………………. The real Causes and Casualties of The housing Crisis …………………………………… Questionaries Findings………………………………………………………………………… Conclusion…………………………………………………………………………………...… Reference List……………………………………………………………………………… ..... Appendix………………………………………………………………………………………. Literature Review BACKGROUNG OF HOUSING CRISIS IN NEW ZEALAND The unaffordable housing has impacted negatively on the New Zealand society. In between the period of 1986 and 2013, the home ownership dropped from 74% to 65%. Along with this, considering the period of 2017 to 2019, the waiting list for public housing reached doubled, i.e., record of 12,500 in August 2019. The rise in the property prices over decades has impacted upon the distribution of wealth in New Zealand. There are different reasons because of which increment in property prices could be considered such as deregulation, immigration and politics along with ongoing debate in relation to finding out an appropriate solution in order to address the issue. The Human Right to a decent home, which means everyone has to right his own home (Hunt, 2019). A house is a sanctuary, a secure place, an area for kids to grow, space for us to become old in, safe, fast, and affordable home enables us to learn, participate, and work, these are all markers of an honest society and maybe something that each one people can access, not just a lucky few, due to high price of the house all over the New Zealand (Polkinghorne, 2020). In the 19th century, New Zealand encountered a housing emergency because of World War I, materials was expensive and hard to secure, making building a home extremely difficult for a family and The housing crisis was New Zealand-wide, However small cities were severely affected (McGibbon, 2015). The Housing Act of 1919 grants fund to local authorities, which they might borrow to hire labour for dwellings to sell, but this was only confined to big cities, like Auckland and Wellington. (Harre, 2021). The primary state houses were built in 1905 by The Liberal government after passing the Worker's Dwelling Act (Wellington City Council, 2017). The point of the Act was to supply low-cost lodging to city specialists to bargain with foul living conditions in working lesson locale, Unfortunately, schemes were not

exceptionally effective, and from 1912-28 the proper reform government sold off the remaining residences and advanced private domestic possession (1919 New Zealand Acts As Enacted, n.d.). At that point in the 1930s, the labour government presented state lodging and numbers houses were built by private development companies such as Fletcher Development ltd (The First State House, 2014). The labour party came into action in 1935, and the Labour introduced state housing and the following year, it began a massive state house construction program that focused on the destitute and low-pay workers (Aimer, 2012). The first Labour Government, driven by Michael Joseph Savage, needed to give homes and solidness to individuals left jobless after the depression and grant advanced cash for private house buys and fabricated houses for the general population to lease (Homes and Communities, n.d.). By 1940, state land advancement programs represented 45% of all housing development in New Zealand (Richards, 2018). The state housing consisting of the only small number of dwellings in 1974, The Housing Corporation take action to fulfil the demands of state housing, However back in 1950's state housing authority was failed to purchase state rental properties (Social Housing: Tenants in State and Community Housing, 2021). THE CURRENT SITUATION OF STATE OF HOUSING MARKETS AND THE HOUSING SYSTEM IN NEW ZEALAND. With the help of getting succeed in dealing with COVID-19 impact, it has made it possible for the Kiwis and investors who parked their funds in the real estate business to make use of it again. The situation has led to a drastic change in the prices and lowering down the economies of not only New Zealand but also other countries. The improvement in the situation has made it possible to real estate businesses to grow to some extent. The housing prices have been doubled in comparison with the last decade and successive governments in the country of five million have struggled in order to find out appropriate solutions for the same as well. In order to make improvement in the situation, the consideration related to tightening the mortgage loans have also been made possible which will help in settling the housing policies in an effective and efficient way. An enormous number of individuals on low earnings live in more seasoned lodging stock, which is regularly cold and damp. Lack of warming and protection implies that homes are unprepared to manage winter temperatures. These helpless conditions are connected to expanded sicknesses and contaminations, particularly in small kids (Habitat for Humanity New Zealand, 2019). All these illnesses linked to cool, moist, stuffed homes execute more New Zealand youngsters than vehicle crashes or drownings. On average, 20 kids die and 30,000 are hospitalized each year for treatable housing-related illnesses such as asthma, pneumonia and bronchiolitis. Helpless territories with high hardship and low wages, heaps of rental lodging, and less Europeans endure the most rural areas like Auckland's Pt England and parts of Glen Eden. The illnesses peak in winter. They kill more children than car crashes or drownings, which claim an average of 10 lives each year. (Johnston, 2020). THE CAUSES OF NEW ZEALAND'S HOUSING CRISIS In relation to the main reasons of housing crisis in New Zealand, the consideration is related to election issues, no media recognition and coverage to the immigration policy which has led to no response from the government to the situation as well. Along with this, the reason also includes about steering down the discussion of supplying new housing stock to the customers in order to meet with their needs and demands properly. The non-recognition of media has also led to worsening the situation related to housing in the country in negative way.

The rental situations ( https://www.stuff.co.nz/life-style/homed/latest/101496442/sure-renting- in-wellington-is-bad-but-it-could-be-much-much-worse ) House rental market in New Zealand is really bad, it has touched the crisis point. As New Zealand is destination country most of the population is migrants that lives in rental houses and it is being unaffordable for them, especially students. Students must live in sharing and have to cut their corners to survive on such expensive land. https://www.stuff.co.nz/national/101771320/rental-prices-ramped-up-in-southland-due-to- housing-shortage There is increase of 8% rents in south islands of New Zealand and its sole reason is housing shortage. Furthermore, some non popular places like Invercargill is also facing issue of high rental. https://www.nzherald.co.nz/business/city-of-slums-inside-the- rental-market/MEPCZOJVDEN5YVFDV5WFGMW6XM/ Moreover, the description and price mentioned in online advertisement of vacant rental house is totally different in reality. It is said to have city of slums which is full in todays rental market. affordability of housing- this year it is noticed that the housing affordability is worst as compared to last 17 years. Moreover, it is not a good news for first-home buyers that the price-to-income ratio of the country’s houses has been climbed to its highest point since the stats has been collected from the year 2004. https://www.stuff.co.nz/life-style/homed/real- estate/124350937/housing-affordability-at-worst-point-in-at-least-17-years One of the report that was led by CoreLogic Housing Affordability it states that and medium house price-to-average domestic salary share in the last quarter of the past year was 6.8 nationally, this is highest level in last decade. However, it surged to 6.5 in the third quarter of the 2020 year. This shows there is colossal upsurge in the housing market which is being unaffordable for a common person to buy. reasons behind housing crisis – One of the conspicuous reason behind the housing crises is increasing population. As New Zealand is beautiful nation more and more people fell in love with country and permanently wants to settle here. Germany is regularly referred to act as an illustration of a well-working real estate market and it has kept up stable house costs for quite a long time. One justification this is the strength and security of its rental market, which implies there isn't a similar strain to purchase as there is in different nations. Another explanation is business charge motivators for government around lodging advancement. This has left nearby government quick to empower and uphold advancement, which has guaranteed supply fulfills need. https://www.stuff.co.nz/life-style/homed/real-estate/123722218/addressing-the-housing- crisis-what-nz-can-learn-from-other-countries governments effort to solve this issue Government has smart plans to resolve urgent issue of housing crisis considering for long term as well as short term. Government has taken three major steps. First step is to increase house supply to relax its demand by spending NZD $3.8 billion towards new houses. Second step is to relieve the pressure on the market this will be achieved

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by a crack down on investors and third step is to assist first home buyers several plans will be launched to assist them. https://www.scoop.co.nz/stories/AK2104/S00031/will-these- changes-solve-new-zealands-housing-crisis.htm Future of housing in nz There are various notions prevalent on the future housing market in New Zealand. The most preponderant one is small houses will be made instead of big lavish places. Followed by houses without garage and no parking spaces will be built and land is so expensive in New Zealand. Next is more people living in sharing to divide the cost of living which so highly expensive these days. Governement will take some initiative to resolve this but it will take some time to normalize and till that time citizens need to keep patience. https://www.oneroof.co.nz/news/what-nzs-homes-of-the-future-will-look-like-35772 Reference list Aimer, P. (2012, June 12). First Labour government, 1935 to 1949 . Teara.Govt.Nz. https://teara.govt.nz/en/labour-party/page-2 Harre, B. (2021, March 14). New Zealand’s Rack-Rent Housing Crisis: Five Part Series . Medium. https://medium.com/land-buildings-identity-and-values/new-zealands-rack-rent- housing-crisis-ec40d5f9aec2 Hunt, P. (2019, July 2). The Human Right to a decent House . Www.Hrc.Co.Nz. https://www.hrc.co.nz/news/paul-hunt-human-right-decent-home/ McGibbon, I. (2015, February 17). Impact of the war . Encyclopedia. https://teara.govt.nz/en/first-world-war/page-8#:%7E:text=Of%20the%20First%20World %20War’s,severely%20affected%20the%20small%20community Polkinghorne, J. (2020, February 13). The Human Right to Housing . Greater Auckland. https://www.greaterauckland.org.nz/2020/02/17/the-human-right-to-housing/ Richards, K. (2018). Origin of the Housing Crisis In NZ/Aotearoa . Https://Libcom.Org/. https://libcom.org/history/borigin-housing-crisis-nzaotearoa Social housing: Tenants in state and community housing . (2021, February 9). Community Law. https://communitylaw.org.nz/community-law-manual/chapter-24-tenancy-and- housing/social-housing-tenants-in-state-and-community-housing/ Wellington City Council. (2017, April 20). Workers’ Dwelling Act Houses . Wellington Heritage - Absolutely Positively Wellington City Council Me Heke Ki Poneke.

https://wellingtoncityheritage.org.nz/buildings/1-150/60-1-and-60-2workers-dwelling-act- houses-coromandel-st Social housing: Tenants in state and community housing . (2021, February 9). Community Law. https://communitylaw.org.nz/community-law-manual/chapter-24-tenancy-and- housing/social-housing-tenants-in-state-and-community-housing/

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