The Chinese are back in the market

April 2016

The Chinese are back in the market

Asian investors are starting to invest in our market again after a dip late last year, following the Government’s overdue introduction of the Bright-line Test for the sale of residential property. From October 2015 onwards there was a noticeable downturn in residential sales across Auckland. This continued into the beginning of 2016.

We are now seeing the reverse of this downward trend. Foreign buyers have registered with the IRD and are seriously investing in the property market again. We have begun to see an increase in their numbers at open homes.

While this is obviously excellent news for real estate businesses and vendors, it does little to alleviate the chronic housing shortage. There is still an ongoing shortage of new houses being built. And sadly for young wannabe first-home buyers, the new houses being built are not low cost.

And at the risk of continuing to gnaw at an old bone, this is just one of the issues faced by a city struggling to accommodate its growing population.

Transport

One of the biggest problems facing Auckland apart from housing is transport. The current Auckland-wide infrastructure is simply not coping. The CBD is buckling and will become paralysed by the number of major projects about to begin construction. These include the $2.5 billion City Rail Link, the International Convention Centre, the 36-floor Downtown Centre and the 53-storey NDG Tower, as well as other office, hotel and apartment towers.

A third of Auckland’s transport congestion is in the city centre. Nearly 80,000 commuters, students, shoppers and visitors travel to the city every weekday morning between 7am to 9am.

There’s only one thing to do – ditch the cars when entering the CBD from now on.

An increase in high-rise apartment blocks will increase the numbers of cars in concentrated areas.

Shortage of skilled tradespeople 

We’re seeing development projects that can’t get off the ground because there just aren’t enough chippies, painters, sparkies and plumbers to do the work.

Shortage of building materials

And there aren’t enough construction materials either.

Here are some solutions

Decentralise education, government and big business from the CBD
Take jobs out of the city area and into the community, reducing the number of cars on the roads.
Create satellite hubs designed for universities and government offices that are supported by local schools, libraries, shopping centres and good public transport links.

Encourage and incentivise beneficiaries to move to centres outside Auckland
This would potentially free up land in the CBD for special housing areas that include affordable housing or purpose-built blocks of student accommodation.

Encourage and incentivise new migrants to settle outside Auckland

Double apprenticeship incentives in the trades

In West and South Auckland there is a big population of young people aged 16-20 with no jobs, no skills and no hope. Why not put these supported unemployed people into apprenticeships? Give them a future. Give them a trade.

There, what are you waiting for, Auckland?