Government’s vision for housing

Below is an extract from a speech by Housing Minister Chris Bishop to Committee for Auckland in Feb 2026. We think his comments on housing policy in general are important, which is why we’ve put them here. We recommend reading the full extract because it is the single best indicator of where the government wants our housing market to go, especially in the larger centres. It also explains their motivation, and it shows how a broad political consensus on housing policy has developed, with the current government’s policy building on what Labour has done previously. It’s a powerful and thought-provoking read.

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“In that context, today, I want to talk more about housing and its importance to New Zealand. For too long, our housing market has held us back socially and economically.

Economically, housing eats up disposable income, meaning less can go toward goods, services, and investment. It ties up wealth; and displaces productive investment. A lack of housing in the right place also leaves productivity and agglomeration benefits on the table.

Socially, housing plays a large factor in young kiwis deciding to leave New Zealand to find better opportunities. Unaffordable housing also tips more people into situations where they need support. Currently, there are around 19,500 families on the social housing wait list.

Various governments of all different colours have put housing in the too hard basket and failed to make the tough calls required.

This government is different.

I am determined to fix housing for three reasons.

1. Boost the economy

2. Help get the books back in order

3. Moral case

The first reason is to boost the economy.

Housing is fundamentally a productivity enabler, and for decades, New Zealand has suffered from a productivity disease. As Paul Krugman so famously observed, “Productivity isn’t everything, but in the long run, it’s almost everything.” Productivity drives our standard of living and our prosperity.

Even though New Zealand is blessed with extraordinary competitive advantages like natural resources, an abundance of land, relatively cheap renewable energy, and a Number 8 Wire mentality – we have fallen behind.

We used to make the most of our advantages. In 1900, we had the highest number of patent applications per capita in the world, and in the 1950s and ‘60s we built innovative and world-leading infrastructure. In the early ‘60s, our productivity was well above Australia’s, but somewhere in the ‘70s our productivity dropped, and the gap kept widening.

Now, our productivity is closer to places like Poland, Hungary and the Czech Republic than it is to Australia and other western European countries we like to compare ourselves to. In other words, our productivity rates are on par with countries that endured 40 years of communism. The hope or assumption that our advantages will automatically confer prosperity is misguided.

Complacency is a blight on progress.

It will take a sustained effort and hard work across many years to really get productivity going again. It isn’t going to be easy. But a good starting point is housing.

There is now a mountain of economic evidence that cities are engines of productivity, and the evidence shows bigger is better. In New Zealand, it is estimated that doubling a city’s population could increase output by 3.5%. And, on average, workers in cities earn one third more than their non-urban counterparts.

Throughout history, cities have also been the hub of innovation. Think 15th century Florence, 17th century Amsterdam, 18th century London, and San Francisco today. A well-functioning housing market that delivers thriving cities, growing productivity, and super-charged industry will do more to create a brighter future for everyone in this room – and for everyone in New Zealand – than just about anything else Government can do.

Early economic modelling of our RMA reforms suggests that liberalising housing will lift GDP by at least 0.45% annually by 2050, with growth continuing thereafter.

New Zealand can simply raise our productivity by allowing our towns and cities to grow up and out. We need bigger, denser cities and, to facilitate that, we need more housing capacity. The second reason to fix housing is to help get the government books back in order.

Central government spent over $5 billion last year alone on housing assistance in many different forms. That includes the accommodation supplement, subsidies for income-related rents for people in social housing, emergency housing grants, transitional housing, and initiatives to address homelessness. Each new government programme has begat another government programme; and they have grown like mushrooms.

The system is complicated, confusing, and often duplicative. Most importantly, it is extremely expensive.If that $5 billion stays flat over the 4-year budget period, the Government will spend over $20 billion on helping people to be housed.

That’s 15 Transmission Gully motorways, or around seven New Dunedin Hospitals – an astonishing amount of money to spend every four years. Every dollar spent on subsidising rents is money that can’t be spent improving our education system or on fixing the health system.

I recognise there will always be some people who require housing support no matter how affordable the general market is – and that’s OK. But improving housing affordability will significantly reduce the demand on the government for housing support.

The third reason to fix housing is the moral case.

Something has gone very wrong when home ownership is at record lows in a country that used to pride itself on being a property-owning democracy. Something has gone very wrong when so many New Zealanders and their families look overseas in search of more affordable housing.

One of my staffers was at an Auckland bar last Saturday and overheard a young couple reacting to someone who said they owned two houses. It went something like: “Wow, you must be so rich”, and “It’s too hard to buy a home in New Zealand for us”. Conversations like this happen every day across many bars.

Then, suddenly, you have a generation of young people ready to leave a country that did not make room for them. The simple truth is that young people today just don’t have the same opportunity to get into the housing market as their parents did, or their grandparents.

In 2002, New Zealand’s housing market met the widely accepted international standard of housing affordability, with the ratio of house prices and wages at 3:1.

Now, house prices outstrip wages by around 6:1.

Fundamentally this is an issue of intergenerational equity.

So – economic, fiscal, and moral – that’s my case for changing housing in New Zealand.”