Polity by Rob Salmond

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Polity: House-buying patterns in Auckland

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  • Alfie,

    The Herald reports that a couple of wealthy National Party donors are selling more than $26 million of property in Auckland. Their names are Zhao Wu Shen and Susan Chou, but obviously, I wouldn't want to read anything into that.

    What interested me is that both people are listed as students on the electoral roll. WTF?

    Dunedin • Since May 2014 • 1386 posts Report Reply

  • chris, in reply to Alfie,

    I wouldn’t want to read anything into that.

    But you did kind of, didn't you?

    What interested me is that both people are listed as students on the electoral roll. WTF?

    New Zealand Education™ - Big Business since 1989:

    Nearly 100,000 international students chose New Zealand for their studies abroad in 2012, contributing NZ $2 billion (US $1.64 billion) to the economy and supporting approximately 32,000 jobs. And, a further 3,000 students were enrolled last year in offshore programmes operated by New Zealand institutions.

    This makes international education a significant export sector in the country, and the government aims to see it bigger still, having set a target of doubling the sector’s value to NZ $5 billion (US $4.1 billion) by 2025.

    Star Performer(23/1/2015):

    In terms of intake, there was noticeable growth from China, India and Indonesia. China became the single biggest market for New Zealand education. Student enrollments from China went up by 2,978 or 12 percent, and 29.1 percent of the total international student spending also came from China.

    Mawkland • Since Jan 2010 • 1302 posts Report Reply

  • Alfie, in reply to chris,

    I understand the economic benefit of foreign students, but I fear you may have missed the point of my post Chris. These "students" are selling $26m worth of property. While I've known lots of students in my lifetime, not one of them had access to that kind of crazy wealth.

    Now it's possible that they have stupidly rich parents, I grant you -- Max Key flaunt it if you've got it types. But isn't it also possible that students are fronting for (and thereby effectively concealing the identity of) wealthy offshore owners? Because to my mind, that scenario is what the government's soon to be enacted local bank account & IRD number housing legislation will surely encourage.

    Note also that this couple threw $370k to the Nats. Again, that's not overtly student-like behaviour.

    Their company has been registered in NZ since 2002 and the directors' addresses are in Hong Kong. Students for 13 years? Yeah, nah!

    Dunedin • Since May 2014 • 1386 posts Report Reply

  • chris, in reply to Alfie,

    I think what I’m getting at is that student can just be taken to mean an educational consumer. Ben Wilson’s a student. Grey Power were representin’ in some of my classes at Uni. With sufficient funds it’s one of the easier ways for immigrants to get a foot in the door – the cut price overseas investor category.

    National Certificate in Hairdressing (Salon Support)

    Mawkland • Since Jan 2010 • 1302 posts Report Reply

  • Katharine Moody, in reply to Alfie,

    What interested me is that both people are listed as students on the electoral roll. WTF?

    Student must be what they stated as their occupation at the time of registering on the electoral roll. A foreign student studying in NZ, who enters on a student visa – cannot vote – so this couple must both be permanent residents or citizens of New Zealand;

    http://www.elections.org.nz/voters/enrol-check-or-update-now/who-can-and-cant-enrol

    And ‘student’ was what they stated as their occupation at the time of registration on the electoral roll.

    This does raise another point however, that of student allowances – which they might well have been on when registering to vote. Student allowances are not loans – they are taxpayer funded – and they never have to be paid back – here are the criteria;

    http://www.studylink.govt.nz/student-allowance/

    They are income but not asset tested. As long as you don’t work, and you don’t collect an income (or if you make a loss on your asset, I assume .. a ‘negative income’) on your assets, I imagine you would qualify for a student allowance (and provided you are enrolled to study).

    Wellington • Since Sep 2014 • 798 posts Report Reply

  • BenWilson, in reply to Katharine Moody,

    They are income but not asset tested. As long as you don’t work, and you don’t collect an income (or if you make a loss on your asset, I assume .. a ‘negative income’) on your assets, I imagine you would qualify for a student allowance (and provided you are enrolled to study).

    Subject to restrictions that actually catch a tremendous number of students. Parental income, spousal income, being under 24 without children, living with parents, are all factors that will reduce your allowance. Foreign students need to have residency and to have been here for 3 years. By the time you’ve winnowed like that you’re down to poor young local students, unattached mature students, poor postgrad foreign students and young students with children. Each is a comparatively small group. That said, I don’t know how they find out parental income for foreign students.

    Worth noting that the fees themselves were, and still are, heavily subsidized. It’s annoying to pay fees when the people bringing them in never did. But nowhere near as annoying as paying full fees would be.

    Auckland • Since Nov 2006 • 10633 posts Report Reply

  • Katharine Moody, in reply to chris,

    With sufficient funds it’s one of the easier ways for immigrants to get a foot in the door – the cut price overseas investor category.

    Also being discussed here;

    http://www.interest.co.nz/business/76728/number-chinese-investors-applying-nz-residency-jumps-48-over-past-year-competition

    Wellington • Since Sep 2014 • 798 posts Report Reply

  • Alfie,

    The UK papers are reporting claims from Transparency International that UK property purchases via shell companies are being used to move corrupt money around the world. Cameron has finally promised to introduce a central public land registry of foreign companies which would detail which land they own.

    David Cameron will promise to act against corrupt foreigners who buy up luxury properties in the UK using secretive holding companies to hide their “dirty money”.

    The prime minister will use a visit to Singapore to make an anti-corruption speech on Tuesday in which he will express concern that some properties, mainly in London, “are being bought by people overseas through anonymous shell companies, some with plundered or laundered cash”.

    Drawing on proposals advanced by campaign group Transparency International, Cameron will set out his determination to ensure that “the UK must not become a safe haven for corrupt money from around the world”.

    That will make NZ an even bigger target for laundering your dirty millions.

    Dunedin • Since May 2014 • 1386 posts Report Reply

  • chris,

    “the UK must not become a safe haven for corrupt money from around the world”.

    That's a few centuries late but good on ’em!

    Mawkland • Since Jan 2010 • 1302 posts Report Reply

  • Alfie,

    Attachment

    Emerson in the Herald.

    Dunedin • Since May 2014 • 1386 posts Report Reply

  • chris, in reply to Alfie,

    Attachment

    I don’t know, have we reached peak bourgeois yet? The way I see it, that cartoon can only be appreciated by about 2/3 of the country tops, perhaps that’s the readership, but slapping “Foreign” into the title doesn’t change a damn thing for a whole lot of people. It’s not as if foreign owners enjoy a rates exemption or anything.

    Serial renters have watched NZ home owners/ landlords huffing and puffing those prices for decades, homeowners haven’t really got reasonable cause for complaint, and yet my their voice is loud.

    Mawkland • Since Jan 2010 • 1302 posts Report Reply

  • John Laurie,

    If I was living in Samoa, and evidence was presented that non-resident New Zealanders might be buying up 30% of houses on the market, and prices were increasing at such a rate that local residents were being priced out of the market, would my reaction be to feel that that Samoan Government should do something to stop it, or would I just feel offended that someone had targeted New Zealanders?.I am dismayed by the reactions of some high profile New Zealand Chinese on this issue, in that they have reacted emotionally as Chinese and not as citizens of New Zealand, who might also see their children unable to buy houses here. At what stage might this allegiance reverse itself and what is the consequence for New Zealand if there are large numbers of people here whose primary identification is with other countries? I add that I am no stranger to immigrant communities in New Zealand and I don't blame people for feeling like this.

    New Zealand • Since Jul 2009 • 2 posts Report Reply

  • chris, in reply to John Laurie,

    If I was living in Samoa, and evidence was presented that non-resident New Zealanders might be buying up 30% of houses on the market, and prices were increasing at such a rate that local residents were being priced out of the market, would my reaction be to feel that that Samoan Government should do something to stop it, or would I just feel offended that someone had targeted New Zealanders?

    You're the only person in a position to answer that.

    Mawkland • Since Jan 2010 • 1302 posts Report Reply

  • Katharine Moody, in reply to chris,

    Nope. But then I have no idea what white sounds like in comparison to pink, purple, orange, yellow, blue, brown or black. In my family, we have most of those colours and regardless of colour, they all sound like family to me.

    PS Oh, I see you changed your previous post. Well done.

    Wellington • Since Sep 2014 • 798 posts Report Reply

  • chris, in reply to Katharine Moody,

    Nope.

    Yeah, I figured it was a little too meta…my initial reaction was to dismantle the analogy point by point but there’s just too much there:

    reacted emotionally as Chinese and not as citizens of New Zealand

    Mawkland • Since Jan 2010 • 1302 posts Report Reply

  • John Farrell,

    Rob Salmond on the Panel, Radio NZ, today.

    Dunedin • Since Nov 2006 • 486 posts Report Reply

  • Stephen Judd,

    https://www.tvnz.co.nz/one-news/new-zealand/foreign-buyers-account-3-property-transfers-between-january-and-march

    The tax data shows that between January and March 31 2016, three per cent of property (buyers) transfers, involved people who are registered as an overseas tax resident.

    Land Information New Zealand began collating tax data last year to get a better picture of the housing market. However it stresses the data does not amount to a foreign buyers register as overseas tax residency doesn't mean the same thing as nationality.

    In the three months of data released, there were 45,114 property transfers.

    1158 were where at least one of the property buyers provided an overseas tax residency (three per cent).

    321 of those were tax residents of China, 312 were from Australia and 99 from the UK.

    When the numbers are broken down to look at the Auckland market, the influence of overseas tax residents is slightly higher at four per cent

    I don't think this is exactly vindicating, eh. Conversely I'm already seeing lefty nativists on Twitter convinced that the stats must be wrong.

    Wellington • Since Nov 2006 • 3122 posts Report Reply

  • Alfie,

    I just watched Bernard Hickey on Checkpoint who suggests the 3% figure is pretty sketchy and probably under-reports the reality. His logic...

    * For a start, 10% of the data is irrelevant because those transactions were exempt because they were "grandfathered" -- commenced before the October 1st start date.

    * 35% of the buyers of homes said they were foreign students or had temporary work visas. However LINZ said that they may New Zealanders who misinterpreted the survey question, so they weren't added to the 3% figure. That skews the results hugely.

    Hickey reckons the actual number is somewhere between 3% and 48%.

    Quite a wide range.

    Dunedin • Since May 2014 • 1386 posts Report Reply

  • David Hood,

    There is also the percentage of murk- where a company or trust is the immediate owner, that falls into the "doesn't count towards the 3% because we don't know the ultimate owners".

    That would greatly affect the results, but in this case this you can get a ballpark of the size of the problem,. Possibly naively I would suggest you could:

    1) take an old snapshot of the property titles database.

    I assume political parties researchers have been doing this. If I can, people who get paid to do so should be able to.

    2) take a current snapshot.

    3) find all the titles that have changed ownership

    4) find what percentage are companies or trusts.

    This could be done through data matching, but does lead to the potential problem of "inhuman sounding names" where Mr Transpacific Megacorp Holdings Limited is confused with a similarly named company,. Rather than get into a fight over the classification of a tiny number of properties owned by the Trust family (rather than a family Trust) , I would just classify those as "couldn't tell if owned by a human"

    Dunedin • Since May 2007 • 1443 posts Report Reply

  • steven crawford,

    If the house inflation isn’t coursed by foreign people spending money, then it’s coursed by local people borrowing foreign people’s money.

    Is that how it works?

    Atlantis • Since Nov 2006 • 4316 posts Report Reply

  • Tom Johnson,

    The information released is statistically flawed so is useless for analysis.

    Stats is a very principled discipline, break those principles and the data is flawed, welcome to maths 101, bought to you by 1000's of years of mathematical development.

    It doesn't stop a maths illiterate like continuity announcer Hoskings commenting like a buffon on what it apparently shows. Dude needs to finish his year 12 and 13 again.

    The data gathering on this issue is pathetic and blurry, probably intentionally.

    Once again their is a huge problem and we are told to look away because National.

    hamilton • Since Mar 2016 • 98 posts Report Reply

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