What Exactly Is Our Housing Problem?

Does New Zealand have a housing problem that is caused by too many people and not enough houses? Dunedin Methodist Mission CEO Laura Black sees it differently. She sees our problem not as a shortage of houses but as a mismatch between where the affordable houses are and where the people wanting a house live.

Ms Black says, “the provinces have food, roads, inexpensive houses, few jobs. Auckland has not enough roads, phenomenally expensive housing and some jobs.” (The Star, Nov 20, 2014) It’s worth noting here that ‘some jobs’ is the operative phrase. Auckland consistently has a higher unemployment rate than the national average so perception does not equal reality.

Ms Black has a point. It is worth exploring what could be done to encourage people to areas where there is ample affordable housing and underutilized infrastructure.

Forget draconian Big Brother type measures such as forcing people to move or have their benefit cut. Forget subsidies to businesses to relocate – they tend to take the money and run. Let’s think outside the square, to innovative, radical ideas that entice rather than impose.

We could apply one of the most exciting concepts gaining momentum around the world – a universal basic income. Allow local councils in towns with a surplus of affordable housing and space in their existing public education facilities to apply to be designated universal basic income zones.

Everyone over 18 yrs old living within the town boundaries, whether working or not, could then be paid a tax free universal basic income of at least the equivalent of the single superannuation rate for adults. A slightly lower rate could be paid for children. This would have two benefits. The extra income for residents already living in the area would stimulate local businesses, creating employment opportunities. And the combination of possible jobs, affordable housing and a UBI would encourage people to move to the area.

Observations from areas in the world where a universal basic income has been introduced are that many people use the money to support themselves while they start small businesses. There is no evidence that once they have their UBI nobody wants to go to work anymore. However it does mean that people have more flexibility. They can take time out to further their education/ develop new skills or work less hours and spend more time caring for families This is not a problem because it opens up more employment opportunities for others and leads to a more skilled and motivated workforce.

For the faint hearted politician, there could be a time limit to the experiment, for example 10 years, and it could be made contingent on local bodies ensuring that housing remains affordable and that the existing infrastructure is able to cope. Nobody can claim it is unfair because if they move to a designated UBI area they too can reap the benefits.

The Alliance party is exploring the idea of a nationwide universal basic income to promote greater equality and get rid of poverty. However introducing a UBI on a regional basis would be a good, affordable starting point. The money required would be saved in other areas such as the reduced need for new housing, roads, schools etc in places where population growth has outstripped infrastructure.