‘ Now I have something to pass on to my son’
Rising house prices forcing out locals. Troels Sommerville reports.
While renters struggle with payments up to two-thirds of their weekly income and community leaders talk of families being squeezed out of suburbs they've been in for generations, one 32-year-old mother explains how she's spent 18 years saving for her own plot - even living on buttered bread and noodles.
Turning into the small cul-de-sac of Luke Place, you don’t immediately get the sense that this is the street where tara’s first milliondollar property sold.
Some of the houses need more than just a lick of paint.
But in October, the 790-squaremetre section at number 7 sold for $1.1 million. The two houses on the land bordering Ngati
tara Park went to an investor who plans to rent the homes for now.
Last month, a further two properties in the South Auckland suburb sold for more than $1m, and in the current buyer’s market the trend is likely to continue.
Madu Kari, who brokered the deal, has since sold several properties across south Auckland for more than $1m and he does not expect the market to lose steam any time soon.
‘‘The way it’s going, there’s a huge demand, and I’m expecting even more houses to start going in that price range,’’ Kari says.
And he says sections like the one in Otara are prime fodder for developers.
Mason Ngawhika, of Nga¯i Tahu and Te Arawa, worries about the creep of gentrification.
The region has New Zealand’s biggest population of Ma¯ori and Pasifika and much of its identity is tied to those cultures, says Ngawhika. As the kai a¯rahi Ma¯ori, Ma¯ori systems manager at social change agency The Cause Collective, he advocates for Ma¯ori identity and their relation to the areas they live in.
He believes the unique identity of the region will be changed as Ma¯ori and Pasifika families are forced further south by skyrocketing prices. ‘‘We’ve seen it in places like Harlem or Oakland, where people are getting squeezed out of places they’ve always lived for generations,’’ Ngawhika says.
‘‘Even if you own your own home then a whole new demographic is going to come in here. You’re going to get . . . some of those services you see on the other end of town.
‘‘But at the same time, it really will lose the character, that grittiness, of what makes south Auckland the place it is.’’
It’s a concern echoed by Auckland councillor Efeso Collins, who wrote in the Sunday StarTimes recently about the impact of Pasifika families being locked out of the housing market.
Collins said tara, like many pockets of South Auckland, was conceived out of a few farm paddocks, to house an imported labour force from the Pacific to keep the country’s industrial engine ticking over through the 1960s and 1970s.
But fewer than one- in- five Pasifika families now owned their home and home ownership is likely to become an even more distant dream as tara, like other areas of South Auckland, is increasingly gentrified.
Yvonne Rathjens began saving for her first home at the age of 14 – and was determined to buy in tara, where she grew up.
It wasn’t easy, but in October last year, she moved into a $585,000 home with her husband Thorleif, and son Taylor. After nearly two decades of saving, the 32-year-old fire alarm technician bought a home not far from the surburb she lived in as a child.
A self- confessed rebel as a youth, she still signed up for KiwiSaver as a teen. After initially balking at seeing part of her paycheck disappear, she was soon rewarded with visions of a future worth saving for.
She put a lot of effort into finding her home but said the spark was lit by her parents, who made sacrifices to own their own home. ‘‘My parents, early on, bought their own home,’’ she said. ‘‘I grew up knowing it was possible – even though we were living on buttered bread and noodles, I knew it could be done.’’
And when it came time to buy, she knew she wanted to build a life in the neighbourhood she had grown up in. ‘‘I really wanted to come back here to buy because it was a bit of a statement to say that if I can do it then so can you.’’
And now she has a tangible future she can see within the four walls of her home.
‘‘ If I want to bust down the wall then I don’t have to worry about the landlord . . . Now I have something to pass on to my son.’’
However, the increasing interest in South Auckland from investors is leaving many others behind.
Val lives in Papatoetoe in a six-bedroom house with her husband, two of her children, and her parents. It’s the home she’s been in for the last 11 years.
But she wants to head back to Mangere, where she was born and raised. Where in the 1980s her parents bought their former home for $ 26,000. Where she works and where her friends and family are.
But heading for her fifth decade, she thinks that her time for home-ownership has passed. ‘‘My husband and I turned 40 this year and we realised that we would never own our own home. We’ve come to terms with that now.’’
Only recently did they reach the 10 per cent threshold of a deposit for a house worth $600,000. That’s still not enough to get a house in Ma¯ngere, where the median price is $725,000. And it’s far beyond the upper limit of the $ 323,000 they have been approved to loan from the bank.
‘‘ We read stories all the time about young people buying houses, but that’s not what we were raised on – go buy a house,’’ Val said.
‘‘We were told, live with mum and dad for as long as you have to then move out to wherever ... buying a house was never on the agenda. It was: have a family, work and live happy.’’
And it won’t be getting any easier, as house price increases will continue to outstrip wage growth for at least the next five years, according to Treasury stat
‘‘People are getting squeezed out of places they’ve always lived for generations.’’
Mason Ngawhika, right
istics released last week. In the Half Year Economic and Fiscal Update, the government’s top economists expected house prices to rise about 8.5 per cent – four times faster than wages – next year and about five times faster than the economy as a whole. In that same time wages were only expected to rise 2.3 per cent.
Ma¯ngere Budgeting Services Trust chief executive Darryl Evans says most of the people coming through his door can barely afford to save three weeks of rent for their bond, let alone a 10 per cent deposit on a $1m home. ‘‘The Kiwi dream of the quarter acre block doesn’t exist unless you’re wealthy,’’ Evans says. ‘‘ I’d comfortably say that more than 60 per cent of my clients pay about 63 per cent of their income to private landlords.
‘‘I’ve been doing this job for 20 years and the biggest cause of poverty is the cost of private rentals.
‘‘ Rents are just exorbitant. People are paying rents that could service mortgages, but of course they’re not able to because they can’t save for a deposit.’’
Earlier in the year the budgeting service scoured 1500 client budget plans and found that after paying rent, utilities and petrol, the average family of four was left with $39 a week to put groceries on the table. The number is backed up by the Salvation Army, which came to the exact same figure when conducting the same exercise.
‘‘When I hear the government and property developers talk about building affordable houses for $ 650,000, I think even if you made it $ 550,000 or $ 450,000, the vast majority of people who come through our door can’t afford anything near that.’’
The service has tracked clients – many who were Ma¯ori and Pasifika – after they were forced from the area by ever-increasing rents and found they were slowly being pushed farther and farther south. They went from Mangere to Papakura to Pukekohe to Po¯keno to Mercer and some have ended up down past Hamilton.
‘‘Every time they get to a new town, they get set up, put the kids in school and within six months the landlord’s put the rent up S20, $30, $40 . . . and they’re looking to move again,’’ Evans said.
That migration is changing the face of many of the suburbs in south Auckland.
Ngawhika said removing the incentive of investing in housing and implementing a capital gains tax is the first and biggest step in solving the problem. From there he wants to see improved rights for tenants, so they can remain in their homes while being able to save for one of their own.