I was disagreeing with Islander and agreeing with you - lack of punctuation.
I disagree "NZers are weirdly stingy" and gravitate to chosing the lesser rather than the optimal or correct solution.
This approach underlay the deregulation to the building industry and the problems it created.
It doesn't even come down to being able to afford quality - people you can afford quality don't want to pay for it.
If anyone watched the leaky home documentary one of the recurring themes was the use of a cheap fix approach over a permanent solution - cheap being the strategic smearing of silicon (which I call pooh) everywhere as opposed to the installation of the correct flashing.
Silicon, which breaks down in sunlight, and is meant to be used as a binding agent to between two surfaces of flashing which are to be bound together with rivets – is often just smeared over the top of an unsealed flashing lap that may become the source of a leak.
You might have a job that you have a range of quotes that go from $9,500 with all flashing joints bound and sealed correctly to say $8,500 which will be done with the laps just put in place. The first job will likely last 17 to 25 years and the other job will last for 3 to 7 years.
The person doing the lesser job will be really busy.
The weird stingy thang comes from people being cognitive misers and not wanting to have to think through in any detail the critical element of any decision they are looking to make.
Sub par housing is what people want - There is a real lack of wanting quality - people want cheap crap - that is the primary driver.
There is a bit that you are missing out on - that covering the loss akin to forced saving - when you consider it over the term you are to hold the ppty - say that term is 25 years.
If you look at that 25 year term say you had taken the money you were covering the cost of the mtge and invested it in the Stock Market, Managed Funds or Finance Company Debentures and experienced a crash or a loss the value of your investment would be lost.
An invesmtent in ppty is more likely to retain a core value and utility that are real - whereas financial instruments can be meaningless and of no value in an adverese economic situation.
Investment in land is a discipline that a person is more likely to research well and stick with.
That is all they needed to do IMHO and they should move on.
The only other ones that seem to be nearly as bad tend to be all about other financial instruments. .
So here you are dishing Kiwisaver and investment in managed funds etc??.
What all these guys don't get is that money flowing around and around doesn't make squat. Only production makes something. So actually building or improving homes is practically the only good capitalism involved in the property market. .
Just to make it clear that money - the means of exchange - flowing around and around keeps people in work and business in business - we have a problem because this has stopped circulating
Add to this that post GFC the Govt failed to foster a recovery and just when it was starting to lift they actually killed it off with the GST hike which only hurt the lower paid.
Look at the price of your daily bread for example.
We also have a problem is that huge sectors of the populace have had their savings wiped out by the Stock Market Crash and the recent Finance Company collapses - so all those surpluses that people exposed to the various crisis had are largely gone and now people are looking to have their savings invested off shore through Kiwsaver products.
The minimum tax profit equation makes me ill - what ill concieved nonsense.
There was a land tax in the late 70s.
I am against a capital gains tax - more tax doesn't make for better government.
Better government is part of the answer
NZ Governments fail to deliver effective frameworks both in legislation and in practice.
Recent major failings are apparent in:
*The Leaky Building crisis
*The collapse of Finance Companies.
These two "thangs" will have a long term depressive effect on the economy as they squander the savings of people approaching retirement, - saving are the future spending - the same ay borrowing or credit is future income.
There are other thangs.
All tax burdens eventually filter down to the lowest income level because at that lower level there is no mechanism to pass on the burden.
I said this before: "I don’t think that taking money, from rent, out of circulation in the economy and giving it to the government is a good idea - it won’t solve the problem though it will make it harder for people renting.
In an equation where CGT becomes an input and rent is the output - the introduction of a CGT (Land Tax) rents will increase as a result. Landlords will need to collect more rent to pay for CGT and tenants will have to pay more rent to secure tenancy in a rental market with a shrinking stock of rental ppty."
I don't think I will get the opportunity to be proved right as a Labour coalition is unlikely to prevail and I am thankful for that.
NZ has a low wage economy as in essence it doesn't really have much of an economy - This is just the way it is - a CGT won't improve a thing - IMHO it will only make matter worse.
Cutting the budget in election year, though it is extremely cynical, makes sense politically for them. I think this government are in permanent mode of lets look like “We've already won the election".
I can't see them fronting up much because:
1) They aren't up to the challenge
2) They intend to leave the opposition howling at the moon, and
3) Avoiding intense debate on issues and policy is how they will win the election.
On Sean Plunket, he is a curmudgeonly crusader who can temper an issue, in the metallurgic sense, live on air and highlight an absurdity. I didn’t find him combative, over the years the people that took offence to his insights, which ever side of the house they sat, needed waking up.