Washed-up Brit MP knows more about the New Zealand housing bubble than the rest of us

Bryan Gould must be taking advice from Bernard Hickey, who has been the prophet of doom for years now.

New Zealand’s housing bubble is about to burst, former British politician and former Waikato University vice chancellor Bryan Gould says.

“This is not a normal market. We need to stabilise house prices or else it will burst. That’s going to happen sooner rather than later.”

Furthermore, he says Reserve Bank Governor Graeme Wheeler is being weak by not making the banks rein in their lending habits.

Why is he moaning about this? His much-cherished Labour party has been wanting house prices to drop for a long time. They haven’t worked out yet that wishing it and getting blamed for it will also lead to electoral oblivion as all those people whose house values drop won’t be happy at all.

Yes, land needs to be released for building, but that isn’t the only key to solving the housing problem, Gould says.

Gould spoke to a captive audience on Thursday of about 100 people at Hamilton’s St Peter’s Cathedral in a talk called “We Can Be Better Than This”.   

Wheeler was a smart man and knew what needed to be done, Gould says.

The banks would attack Wheeler if he created policy limiting their ability to lend, as it would hurt profits, he says.

However, banks that continue to lend up to nine times people’s salaries are contributing to the steep house prices and housing unaffordability.

“If banks gave all of us half a million to spend on cars, that would drive up the price of cars. But it’s houses they are lending on.

“History tells us sooner or later the bubble will deflate. And these bubbles don’t deflate slowly.”

Chicken Little. The bubble only really exists in Auckland with a bit in Tauranga and Hamilton. Other than that it is pretty stable elsewhere. Bryan Gould is just a drop kick who seems to always get himself published by the left-wing Media party because he used to be a pommy MP (a failure at that too BTW) and the former vice chancellor at an average university.

Bryan Gould is an inveterate socialist who once stood for the leadership of the UK Labour party and got rinsed, hard. He quit in disgust soon after.

Gould took aim at more than banks in his speech, however.

He says the only way to sort out most problems is to address the root cause – in this case, supply. So part of the answer is to put a glut of affordable houses on the market.

Both the number and the type of houses being built are not addressing the problem.

Those houses are for the higher end of the market, he says.

He called for people to take organised action to create changes.

“We live in a country where everyone should have access to housing. But they don’t. Something is going wrong.”

This conundrum had happened in effect because the Rogernomics of Roger Douglas under Prime Minister David Lange brought inequality to New Zealand, Gould says.

He came to New Zealand during the Lange era and heard Douglas and his cohorts espouse these radical economic theories.

“Their eyes were blazing with the zeal of religious converts.

“But it had failed in Britain.”

He described it as a free-market philosophy where people would grab what they could.

Class segregation and the extreme wealth and poverty were nonexistent in New Zealand until then, he says.

“That sort of inequality was only known in the likes of Britain.

“These conditions have now become endemic in New Zealand.”

His view of history is tinted as red as his political beliefs. Margaret Thatcher saved Britain from socialism just as Roger Douglas did for New Zealand. They are heroes not villains.

Bryan Gould sees them as class traitors. His solution suggests he’d like to see boycotts and attacks on banks and an engineered collapse of the sector with a corresponding collapse of house values. That’s how dangerous he is.

He’s fool.

 

– Fairfax


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As much at home writing editorials as being the subject of them, Cam has won awards, including the Canon Media Award for his work on the Len Brown/Bevan Chuang story. When he’s not creating the news, he tends to be in it, with protagonists using the courts, media and social media to deliver financial as well as death threats.

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