Is It Time to Nationalise Empty, Foreign-Owned Houses in New Zealand?

It isn’t fair that Kiwis sleep on the streets while houses sit empty because their foreign owners are gambling on the New Zealand housing market

As seen by its climbdowns on the TPPA, on medicinal cannabis and on immigration, the Sixth Labour Government lacks courage. This means that the time has come to make some truly bold suggestions. Given that our homelessness crisis has long ago reached critical status, it’s time for a bold solution to the housing shortage. This essay proposes that we nationalise all empty, foreign-owned houses to provide shelter for our own people.

The state of homelessness can be summed up by the fact that there are believed to be 24,000 homeless in Auckland alone. This gives New Zealand by far the worst homelessness rate in the OECD, a list which includes much warmer and poorer countries like Mexico.

Per capita, our homelessness rate is far worse than the second-placed Czech Republic and around twice that of Australia, despite that it’s much easier to be homeless in the Australian climate. It’s gone beyond being a national disgrace, to the point where it is threatening our status as a developed country with a functioning society. It’s time to consider extreme measures.

It’s hard to get an accurate figure on the number of New Zealand homes owned by foreigners. The people making most of the profit off selling them have a vested interest in restricting awareness of, and information about, their activities. However, we can make educated guesses.

A 2016 census revealed that over 8% of Vancouver homes are unoccupied. From the same link, we can see that slightly fewer than 6% of Vancouver homes are both unoccupied and owned by foreigners. So roughly two-thirds of empty homes in Vancouver are also owned by foreign residents.

There are believed to be 33,000 empty houses in Auckland, with others saying 35,000. If two-thirds of those houses are both empty and owned by foreigners, that makes for 22,000 homes – about the same number as there are homeless people in Auckland.

The Vancouver solution so far is to charge a 1% property tax on an annual basis for every Vancouver property left unoccupied. This amounts to $10,000 in taxes for a million-dollar property. Vancouver is infamous for its overheated housing market and perhaps represents an extreme case, but the basic principle is the same as in Auckland: most of these foreigners are speculators who have parked money in real estate for the capital gains, and they have no interest whatsoever in the ability of the locals to find affordable housing.

The question naturally arises: if there are so many foreign residents who are keeping houses empty purely for the sake of making a profit, and so many Kiwis who are going homeless because of the shortage of available housing, why be satisfied with a tiny bit of tax as compensation for the damage done? Why not nationalise empty houses that are owned by foreign residents?

Nationalisation could proceed on the grounds that owning a house in New Zealand and deliberately keeping it empty is a crime, in much the same way as owning a business and refusing to serve a customer on the basis of their race is already a crime.

Deliberately keeping a house empty when there is a housing shortage would therefore be declared to be a crime equivalent to refusing to stop to ascertain injury at the site of a motor vehicle accident. In other words, it would be an action that represented a criminal level of disregard for the well-being of the people of this nation.

The logical punishment would be forfeiture of the property.

After nationalisation, the houses would simply be added to the existing Housing New Zealand stock as an asset on the balance sheet. From there, Housing New Zealand would proceed to treat them as regular state houses, and they would be rented out or apportioned to the needy as was necessary to meet their needs for shelter.

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