Treasury study disproves PM’s claim that reinstating interest deductibility for landlords will mean lower rents; Study shows much closer links to population growth, housing supply and wages
Luxon I have decided is a very inept politician. If John Key was rolling out this policy he would have realised the way to win over the public is to pass on rent reductions on his own property portfolio. A small financial loss but a big PR gain. Luxon seems to be 'rather' greedy & unwilling to make those sort of personal sacrifices as shown by taking up the Tesla subsidy, accomodation subsidy and now this. No wonder his personal polling is tanking.
And so sad to hear the likes of the Cawthorn institute is having to lay off staff due to cost savings while Whakapapa gets $10 mil when climate change is going to wipe it out in the very near future I despair on what this governments priorities are.
So is Trump and they love him. Luxon's Power comes from perpetuating myths. It relies on gullible numkins and an increase in conspiratorial media infiltration into their numby minds. The wealth distribution should increasingly favour a left wing coalition in a cost of living crisis but no they believe in a tax cut, (getting things done for the landlords) lol. Faulty maintenance prone ferries that can't even lower their lifeboats get ignored. Minister of Transport Simeon Brown is mute on this. They want Police to take on the gangs- by leaving for Aussie? Worse they have two numbies as associate ministers of health "David and Costello" a pair of comedians.
I think it is true that if you believe in a strict father moral code you will vote right. If you have a nurturing parent morality you will vote left. It makes sense to me and explains the mystery of people voting against their own economic interests. Moral codes are what dictates voting.
Interesting thought Bernard-more like a horoscope -I'm not into believing myself- I had nurturing parents who voted Right. Was that religious Ethics? I can truly say that I'm struggling to find any party that aligns with my morals. My own adult children have disparate opinions too. Is it too much to ask for a fair tax system from Labour or just a consistent policy on one that doesn't flip flop if they think they'll lose ala Ardern and Hipkins. A Green party that has a bottom line on Green issues before we self annihilate?
So in summary, once again, lies. Two more to add to the list. Either that or someone knows better than the researchers! Would an OAI request pinpoint who is providing him the advice he is relying on, seeing as its not the research that the rest of us have access to?
Politicians always ignore the advice they are given. The IRD advised Labour against removal of deductibility for landlords and Treasury warned this move would increase rents. Labour did it anyway. Happens all the time.
I hope this can get 100 likes as it's a wonderful deep dive! Thank you Bernard. Luxon does indeed seem very entitled (love the recent Sharon Murdoch cartoon about that) and thinks that repeating the same lines over and over will eventually make people believe him.
I also would love to know if Christopher Luxon will be cutting the rent for his tenants, or is it his inborn and absolute right to charge what he thinks he can get away with.
Chances are his rentals are managed by an agency, with instructions to review rent based on local quarterly averages (not costs like maintenance, insurance etc). I doubt he even knows how much his rentals bring in, how this has changed over time, etc. They're just investments.
The defence of the policy is not aligned with observed reality, but does the PM believe it or does it primarily serve as a set of “alternative facts” to support an alternative, friendlier narrative to justify the policy?
I have an uneasy sense that this is not mere a bad-faith policy argument but one of those imperious speech acts intended to establish a new discursive reality, untethered to inconvenient facts and figures.
So, who is going to call out Luxon and his puppeteers? Where is the opposition from the Opposition? This is going to be a very long 3 years. Thank goodness it's not four!!
Thank you for your analysis Bernard. The striking resemblance of the coalition claim to the trickle down theory, another erroneous assumption destined to exacerbate the rich/poor divide, was the initial prime factor in my doubting it. Just hoping the Labour caucus gets some dedicated talent involved and becomes a real opposition party, and makes your currently vital role here as such a watchdog redundant. There is a vacuum of decency, rational policy making etc to be filled right now.
I have noticed that the government has not mentioned the effect on house prices of rolling back the interest deductibility.
I haven't seen any reporting looking at this either, the effect on rental prices has been the focus.
I assume that it will mean investors will be more willing to pay higher prices and will make it harder for owner/ occupiers to compete with investors to buy.
allowing residential rental property owners to deduct mortgage interest from their income before tax is calculated/payable and reducing the so-called brightline test from 10 years to 2 has reignited/relit/restarted the raging inferno of increasing residential property prices. there will now be another feeding frenzy by the ferocious barracuda residential property investors/speculators and owner/occupiers will be excluded from being able to buy/purchase a home for themself (and family).
why the oposition is not using your work/mails/podcast to drill the goverment against the wall with questions is beyond me! (Btw... when was the last time we had a general stike in NZ? may be that time is coming again...)
Excuse my lack of articulate language but it seems like Luxon is either unable to comprehend pretty simple data (stupid) or he is just plain lying?
Guilty on both counts m’lord
At the end of the day, Luxon is not very bright
Christopher Luxon is exceedingly greedy!!!
Luxon I have decided is a very inept politician. If John Key was rolling out this policy he would have realised the way to win over the public is to pass on rent reductions on his own property portfolio. A small financial loss but a big PR gain. Luxon seems to be 'rather' greedy & unwilling to make those sort of personal sacrifices as shown by taking up the Tesla subsidy, accomodation subsidy and now this. No wonder his personal polling is tanking.
And so sad to hear the likes of the Cawthorn institute is having to lay off staff due to cost savings while Whakapapa gets $10 mil when climate change is going to wipe it out in the very near future I despair on what this governments priorities are.
So is Trump and they love him. Luxon's Power comes from perpetuating myths. It relies on gullible numkins and an increase in conspiratorial media infiltration into their numby minds. The wealth distribution should increasingly favour a left wing coalition in a cost of living crisis but no they believe in a tax cut, (getting things done for the landlords) lol. Faulty maintenance prone ferries that can't even lower their lifeboats get ignored. Minister of Transport Simeon Brown is mute on this. They want Police to take on the gangs- by leaving for Aussie? Worse they have two numbies as associate ministers of health "David and Costello" a pair of comedians.
I think it is true that if you believe in a strict father moral code you will vote right. If you have a nurturing parent morality you will vote left. It makes sense to me and explains the mystery of people voting against their own economic interests. Moral codes are what dictates voting.
Interesting thought Bernard-more like a horoscope -I'm not into believing myself- I had nurturing parents who voted Right. Was that religious Ethics? I can truly say that I'm struggling to find any party that aligns with my morals. My own adult children have disparate opinions too. Is it too much to ask for a fair tax system from Labour or just a consistent policy on one that doesn't flip flop if they think they'll lose ala Ardern and Hipkins. A Green party that has a bottom line on Green issues before we self annihilate?
So in summary, once again, lies. Two more to add to the list. Either that or someone knows better than the researchers! Would an OAI request pinpoint who is providing him the advice he is relying on, seeing as its not the research that the rest of us have access to?
Would love to know who/where PM advice is garnered. Also 'I make no apology' is not helpful, are his advisors tearing hair out he is so inarticulate.
Would love to know who/where PM advice is garnered. Also 'I make no apology' is not helpful, are his advisors tearing hair out he is so inarticulate.
Invisible friends in the Taxpayers Union?
Very interesting question. You can be sure the OIA requests are already in.
Cheers
Politicians always ignore the advice they are given. The IRD advised Labour against removal of deductibility for landlords and Treasury warned this move would increase rents. Labour did it anyway. Happens all the time.
I hope this can get 100 likes as it's a wonderful deep dive! Thank you Bernard. Luxon does indeed seem very entitled (love the recent Sharon Murdoch cartoon about that) and thinks that repeating the same lines over and over will eventually make people believe him.
The thing is, that the repeating it over and over does work it seems. Not here though.
Done and done. Thanks
This info needs to be out there!
Please open up to public just to put the evidence out there about the ‘trickle down ‘ falsehood.
I also would love to know if Christopher Luxon will be cutting the rent for his tenants, or is it his inborn and absolute right to charge what he thinks he can get away with.
Chances are his rentals are managed by an agency, with instructions to review rent based on local quarterly averages (not costs like maintenance, insurance etc). I doubt he even knows how much his rentals bring in, how this has changed over time, etc. They're just investments.
The defence of the policy is not aligned with observed reality, but does the PM believe it or does it primarily serve as a set of “alternative facts” to support an alternative, friendlier narrative to justify the policy?
I have an uneasy sense that this is not mere a bad-faith policy argument but one of those imperious speech acts intended to establish a new discursive reality, untethered to inconvenient facts and figures.
So, who is going to call out Luxon and his puppeteers? Where is the opposition from the Opposition? This is going to be a very long 3 years. Thank goodness it's not four!!
Thank you for your analysis Bernard. The striking resemblance of the coalition claim to the trickle down theory, another erroneous assumption destined to exacerbate the rich/poor divide, was the initial prime factor in my doubting it. Just hoping the Labour caucus gets some dedicated talent involved and becomes a real opposition party, and makes your currently vital role here as such a watchdog redundant. There is a vacuum of decency, rational policy making etc to be filled right now.
Thanks Mary. I would often quite like to be made redundant!
Cheers
Bernard
I bet. The 'as such a' v pertinent. It must be exhausting. So glad you can dive into Waiheke Is waters and reboot.
Bloody facts getting in the way of a great story. Damn it!
If that is the opinion of Treasury where did the rental tax deductability policy come from?
Deductibility had more impact on prices of existing homes. Rents are a different story.
but they are interconnected/related to each other
I have noticed that the government has not mentioned the effect on house prices of rolling back the interest deductibility.
I haven't seen any reporting looking at this either, the effect on rental prices has been the focus.
I assume that it will mean investors will be more willing to pay higher prices and will make it harder for owner/ occupiers to compete with investors to buy.
allowing residential rental property owners to deduct mortgage interest from their income before tax is calculated/payable and reducing the so-called brightline test from 10 years to 2 has reignited/relit/restarted the raging inferno of increasing residential property prices. there will now be another feeding frenzy by the ferocious barracuda residential property investors/speculators and owner/occupiers will be excluded from being able to buy/purchase a home for themself (and family).
why the oposition is not using your work/mails/podcast to drill the goverment against the wall with questions is beyond me! (Btw... when was the last time we had a general stike in NZ? may be that time is coming again...)
Please open up to public
And the way ‘supply’ is managed. But first define ‘the system’?
If the PM has “received advice” on this matter, how easy it to see this advice?