OnPoint by Keith Ng

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OnPoint: My last name sounds Chinese

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  • Sacha, in reply to jh,

    doctor martens boots

    Ak • Since May 2008 • 19573 posts Report Reply

  • Jim Cathcart,

    Hot money is a dangerous thing for a small, open, export-reliant economy. And a tax regime that favours non-productive activities like property speculation is crazy. These are real political issues that I feel strongly about.

    Actually, if we compare this with a washed up property market such as Tokyo, it's quite obvious that hot money knows no boundaries.

    In Japan, sales to Chinese and Taiwan buyers jumped 70 percent higher in three months through March from the year-earlier period, or ¥11.1 billion ($90.8 million) at Sinyi Realty Inc., a Taiwanese brokerage with outlets in Japan. For every 100 new apartments sold, about 10 to 15 are to foreigners from Asia, according to Sinyi.

    “I wouldn’t find a deal like this in China,” said Lin Huan, a 35-year programmer from China’s northeast Liaoning province, who with help from her parents bought a three-bedroom flat in the Shinbashi area of Tokyo for investment, paying the equivalent of $203,000. After recently relocating to Tokyo to work for an technology company, she noticed the weaker yen was making properties cheaper. She expects to make a 5 percent return on the rent annually, whereas property in Beijing yields just 2 percent.

    Chinese buyers are typically purchasing in the 1 million to 2 million yuan ($161,000-$322,000) bracket, a range “tolerable to many Chinese,” said Gui Liangjing, SouFun’s international sales director in Beijing.

    It’s not as tolerable to Japanese. Prices in Tokyo have become “seriously unaffordable,” the annual Demographia International Housing Affordability Survey shows. The percentage of Japanese in the seven biggest cities who wanted to buy a home dropped to 15.4 percent in December, the lowest level since Recruit Sumai Co. started surveying two years ago. Even though it rose to 18 percent in March, those who plan to “take action” by looking or buying declined, the survey showed.

    http://www.japantimes.co.jp/news/2015/07/03/business/salarymen-sidelined-chinese-descend-japan-property-market/#.VaD7BvkirIU

    Since Nov 2006 • 228 posts Report Reply

  • blue_pen,

    Keith Ng stop your moaning we're trying to solve a problem not stitch up the local Chinese.

    Since Jul 2009 • 2 posts Report Reply

  • simon g, in reply to blue_pen,

    Keith Ng stop your moaning we’re trying to solve a problem not stitch up the local Chinese.

    The problem being ... Labour's polling?

    Auckland • Since Nov 2006 • 1273 posts Report Reply

  • blue_pen, in reply to simon g,

    Oh yes you knocked it on the head. It's all about Labour's polling. Jesus wept.

    Since Jul 2009 • 2 posts Report Reply

  • simon g,

    But of course it is exactly that.

    Labour have proposed a range of policies, some of which the gov't has half-heartedly taken up, and others (CGT) that the voters have supposedly not wanted (I would question that, but it seems to be Labour's revised position, post-election).

    They were addressing the issue with dull old policy, but concluded that wasn't working. Hence the switch.

    Opposition parties can't "solve the problem" (your one) without power, i.e. votes. This is how they hope to get them.

    Auckland • Since Nov 2006 • 1273 posts Report Reply

  • JonathanM, in reply to Sacha,

    Hmm, why is adding residential investment a problem? Surely if we encouraged/forced all property investors to only invest in new housing supply it would help solve the housing problem? (Reduce demand for existing stock, increase supply and quality as houses are new).

    Since Jul 2012 • 64 posts Report Reply

  • Sacha, in reply to JonathanM,

    It's a problem for the same reason as it is when locals do it - diverts funding from productive businesses.

    Ak • Since May 2008 • 19573 posts Report Reply

  • JonathanM, in reply to Sacha,

    Sure, but pretty much the only way to move investment from housing to productive businesses is to make the latter comparatively more profitable. Use the current imbalance to increase supply thus decreasing profitability in housing.

    Since Jul 2012 • 64 posts Report Reply

  • BenWilson, in reply to JonathanM,

    Yes, making other industry more productive than snapping up capital would make more capital switch to other industry here. But there are a million ways to skin that cat. You're suggesting making foreign investment build new property? That's one way to get more property built, although it doesn't change the focus away from property investment (although I can see it does stimulate the building industry). Another way could be to just tighten up the rules around investment generally, making it harder for foreign money to do it. Or to encourage them towards productive investment with various discounts/tax breaks etc.

    But however you skin it, you have to identify foreign investment as a serious driver. That has proved to be politically controversial. But it's not something that's just a matter of opinion. It is or it isn't. I'm glad Labour's trying to at least prove it, although the actual methodology is not entirely sound*. This is at least some kind of data. A pity it had to be racially oriented, but I guess that's something of a function of us not keeping records of the origin of property investment here. What else can we really do to find out facts than to mine such sources as there are? We couldn't even begin to implement your idea of demanding foreign sources build until we actually track whether an investor is foreign.

    *I think it does suggest a deeper study could be done. I certainly didn't have any feel a week ago for just how many people with Asian surnames were buying property in Auckland. I'd have had to say "a lot?". In finding out that it's such a high proportion compared to the number of people with Asian surnames who are actually residents, I feel quite a lot more confident in the view that there probably is a lot of foreign capital coming in from Asia. Before it was only suspicion, possibly based on the psychological factor of noticing Asian faces more than European and Maori, and also just on tiny amounts of data, anecdotes, etc. I wish I could compare it to foreign capital from other sources. But the data just isn't collected.

    Auckland • Since Nov 2006 • 10579 posts Report Reply

  • steven crawford, in reply to JonathanM,

    Sure, but pretty much the only way to move investment from housing to productive businesses is to make the latter comparatively more profitable. Use the current imbalance to increase supply thus decreasing profitability in housing.

    With risk of going loopy, we could change talk about trade tariffs on manufactured goods.

    Wellington • Since Nov 2006 • 4045 posts Report Reply

  • Russell Brown, in reply to blue_pen,

    Keith Ng stop your moaning we’re trying to solve a problem not stitch up the local Chinese.

    On what I had expected to be a quiet weekend, we're doing a pretty good job of arguing about a very sensitive topic without it turning into a shitfight.

    This is particularly welcome given that people on either side of the argument blog on this site. But you telling a longtime blogger here to "stop your moaning" doesn't help. Show some respect, please.

    Auckland • Since Nov 2006 • 22584 posts Report Reply

  • Joe Wylie,

    Anyone else noticed the troll squad out & about promoting live sheep exports to Mexico? Someone who'd been let loose on Facebook after apparently passing Creative Trolling 101 took the interesting line that opposition was motivated not by economic or animal welfare concerns, but by racist sentiments towards Mexicans.

    While I felt that the writer's invoking their own claimed Mexican business connections as "whanau" was a bit of a stretch, they really jumped the shark when they suggested that opponents of the live sheep trade would be better employed turning their indignation against cashed-up Chinese ruining NZ's property market. I'll bet a fine mind like that could flip over to Twitter and argue exactly the opposite should the occasion demand.

    flat earth • Since Jan 2007 • 4586 posts Report Reply

  • JonathanM, in reply to BenWilson,

    Yeah - agreed, we need to collect data on who is buying/selling in order to better get a handle on it. Fortunately the Govt is finally doing that come October. Ideally the 'public' info on sales would also be available to the public, rather than available to the public but only for lots of $$.

    Since Jul 2012 • 64 posts Report Reply

  • Q Williams,

    Hmmm interesting, what this article does not do, is prove that foreign investors, including a lot of asian investors, are NOT pushing up house prices.
    Occam's razor says that the simplest answer is often the correct one, ie that a large portion of house sales, far greater than the proportion of resident chinese in Auckland are being sold to people with chinese names, because, a lot of non resident chinese are investing in auckland. I believe it's true that there is not a great rate of return on investment in china because the government there keeps interest rates artificially low, so it would make a lot of sense to invest in New Zealand's wide open, unprotected and inflationary housing market, now wouldn't it. Given that there are over a billion chinese, it's a fair supposition to assume that even if a small percentage of moneyed chinese invest here it would add to the inflationary pressure.
    Quite simple really.
    We don't even collect proper stats, which I'm sure is by design. So we have to guess based on what we can find out from what's available.
    Its classic right wing free market ploy to suddenly give a toss about minorities, breaking with all tradition, and pull the race baiting card against any criticism of neoliberalism and free trade policy outcomes. Outcomes which can include non residents investing in your country's housing stock and playing it like it's stockmarket casino.
    Conveniently enough, we don't have hard stats, so anyone who raises any concerns can be written off as "racist", or "xenophobic".
    I'm sorry if the author of this article feels offended. This does not change the fact that our housing market, particularly in Auckland, is quite posiibly being inflated at least in part by overseas investment.
    From what I recall, anecdotal evidence from people attending house auctions in Auckland would also tend to confirm this possibility.
    It certainly warrants looking into, that's for sure.
    We can expect the right wing to suddenly get all touchy and extremely PC if it serves their purposes. No surprises there.
    Every tactic is on the table for the right when it comes to protecting their own interests. Regardless of their supposed ideals, which of course are always for sale to the highest bidder if there is a buck to be made.

    New Zealand • Since Oct 2011 • 4 posts Report Reply

  • Sacha, in reply to Q Williams,

    I'm sorry if the author of this article feels offended.

    Not an apology.

    Ak • Since May 2008 • 19573 posts Report Reply

  • tussock,

    Clearly not intended as one, eh Sacha.

    You know who drives up the price of houses in Auckland though? The government does, stupid, Labour and National both. Low interest rates, low monetary inflation, high capital inflation, massive and basically unlimited rent subsidies, free money to do up rental places, free money to buy houses under ~$200k (guess what no liveable house is priced under?), tax write-offs for housing investments, trust laws to shield them from everything, and no tax on the capital profits at the end of the day.

    Returns on investment, in housing or land speculation in general, are a couple orders of magnitude higher than anything else in the country, once you get into high leverage promoted by the state through banking regulation. Buy 1 with 10% down, wait for the price to go up 10% (a year), leverage the capital gains to buy another (hey, 10% down, for free!), as long as the state keeps paying out the ever-increasing rents for the poor folk living in them all, you're golden. Five years later you own a free house, or you just keep gambling on whomever is in government not wanting to burst that particular bubble.


    But yeah, sure, blame a minority group. Because you might not be wrong about that in some alternate universe where the state doesn't regulate everything involved in setting the price of houses. Assholes.

    Since Nov 2006 • 602 posts Report Reply

  • TracyMac,

    Regarding the govt not collecting the relevant stats, is that the fault of the bleeding heart lefties – or whatever Mr Semmens kindly classified me as by implication, can’t be bothered rereading the ad hom – or by our awesome capitalist overlords at present who would probably not want too much of a close examination into who this country is being sold off to? (At least they're going to start gathering the stats - although how helpful that will be given there's a visa class where you can just buy your way into the country, who knows?)

    I can’t stand rentierism, and I don’t give a shit about the national origins or residential status of who’s doing it. Or is it fine when it’s “true blue kiwis” – whatever the hell that may be – who are the slum landlords?

    As for the bleating about how the accusations of racism plays into Labour’s downfall, and how the media are playing it up – stop giving them the goddamn ammunition!

    House ownership is a matter of public record. Get your researchers to analyse the top private landlords in this country, if you really care about the home ownership issue. From there, you may well find that some are overseas residents. Analyse THAT before running off with knee-jerk racist crap.

    Canberra, West Island • Since Nov 2006 • 700 posts Report Reply

  • jh,

    Twyford's 'racist', 'cynical' Chinese property buyer statistics de-bunked

    However, data journalist Keith Ng, writing on the Public Address blog, responded to the claims and tore down the statistics point-by-point, exposing clear holes in the methodology used to determine them.

    https://www.tvnz.co.nz/one-news/new-zealand/twyford-s-racist-cynical-chinese-property-buyer-statistics-de-bunked-q00964

    data journalist? what's that? Media bias?

    Since May 2007 • 103 posts Report Reply

  • Russell Brown, in reply to jh,

    data journalist? what’s that? Media bias?

    Data journalism is a recognised and vital sector – and, yes, Keith does data journalism.

    Auckland • Since Nov 2006 • 22584 posts Report Reply

  • Russell Brown,

    NBR has republished Keith's post (with permission), and with comments on.

    Auckland • Since Nov 2006 • 22584 posts Report Reply

  • jh,

    Sorry but hard to see this as anything other than ham-fisted politics. Phil has turned a legitimate economic issue related to the impact of foreign speculators on Auckland housing affordability to a singling out of Chinese investors based on ropy stats. So the political opposition gets to frame labour as dog whistling, labour get to spend days explaining what they *really* meant. And media get plenty to feed off.

    That’s fair.

    The rapid rise in wealth in the worlds most populous country, (China has 21 cities with economies larger than Greece's) it's opening up combined with the strength of Chinese identity (91% identify as Han) make it an ethnic issue. Globalists ("anti-racist") are trying to argue that no one is hurt by globalization (the Burke Report refers to immense benefits).

    Since May 2007 • 103 posts Report Reply

  • Sacha, in reply to Russell Brown,

    where did you think some of our new commenters came from?

    Ak • Since May 2008 • 19573 posts Report Reply

  • nzlemming, in reply to Sacha,

    where did you think some of our new commenters came from?

    Eek. Those almost make kiwibog look like a voice of reason.

    Waikanae • Since Nov 2006 • 2909 posts Report Reply

  • Grant McDougall,

    Labour's claims bring to mind - and I'm normally not given to quoting him - what a certain James Brendon Bolger once said in the early '90s about playing the race card:

    "Good news on Friday, bad news on Monday."

    In other words, it might get you some short-term media coverage and support, but basically isn't worth the hassle in the mid-to-long term.

    Just watch when Parliament resumes. When Labour should be hammering the gov't on any number of things, let alone house prices, they'll instead have to spend valuable time a) fending off racism claims and, b) trying to explain their figures, which, as another neoliberal twit I'm normally not given to quoting, a certain GWB once said, "explaining is losing."

    Dunedin • Since Dec 2006 • 758 posts Report Reply

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