The alleged crisis over the cost of buying a home is more about expectations being too high rather than feasibility.
A sense of automatic effortless entitlement to everything has evolved. Housing affordability is topical, more so following Finance Minister Bill English's relaxation of land development rules, which, however, he admitted would make little beneficial difference.
Contrary to all that is being said, newly-built houses have never been more affordable, but that assertion requires explanation.
But first, compare today's situation with what occurred in the 1960s, that decade being a golden age of house-building in New Zealand, carried out mainly by many hundreds of small operation spec' builders, designing the houses themselves on their kitchen tables.
In those pre-pill days, for that reason, people married in their late teens or early twenties. House mortgages were mainly available only from life insurance companies which would lend a maximum 65 per cent of the total land and building cost at 6.5 per cent interest, but, with the added sizeable financial burden of insisting on the purchase of a costly whole-of-life insurance policy.
But no one complained for values were different then. People did not expect anything for nothing or see everything as a natural human right. Instead it was common-place for newlyweds to obtain higher interest rate, second and third mortgages to make up the shortfall, then both work at part-time evening and weekend jobs for several years to pay off these supplementary debts. Only then would they start families, albeit still in their twenties. Also back then, those first homes were simple one level structures with a single bathroom. Home-seekers' housing ambitions, particularly for their first home, were realistic and matched their financial capability. None of this is the case now.
continues...
hmm
