Quote Originally Posted by SBQ View Post
On the Canadian front for 'doing something about' the problem of 1st home buyer ownership, it seems the Cdn gov't is taking it all the way to the bank so that low income or 1st time home owners can get their 1st home. Unlike NZ, we've stood flat and done absolutely NOTHING about making homes more affordable for the 1st home buyer.

https://www.cmhc-schl.gc.ca/en/media...uyer-incentive

and for more beefier details:

https://www.moneysense.ca/spend/real...yer-incentive/

"The federal government launched a new national program on September 2, 2019, that it says will help thousands of families across the country buy their first home. Aptly named the First-Time Home Buyer Incentive (FTHBI), the program offers eligible buyers up to 10% of a home’s purchase price to put toward their down payment, thus lowering mortgage carrying costs and making home ownership more affordable."

C'mon Ms Ardern, why aren't you doing anything about the issue of home affordability in NZ???

And the eligibility for FTHBI is pretty reasonable:

"are not only people who have never owned a home before, but also homeowners who have gone through a divorce or breakdown of a common-law partnership, or those who have not lived in a home that they owned (or that was owned by their spouse or common-law partner) for the past four years."

And the Cdn gov't will:

"The government will loan buyers 5% of the purchase price for a re-sale home, or 10% for a new one. That works out to a possible $50,000 on a new $500,000 home, or $25,000 on a $500,000 resale property. "

This is on top of the 5% down payment the 1st home buyer needs to have. The FTHBI portion is payable after 25 years with no interest BUT the capital gain value of the house the Cdn gov't will also get the benefit; that is the home owner under this scheme SHARES the capital gain with the gov't, likewise in a crash (not likely house values would be less after 25 years) the gov't will share the loss. But it's interesting to see the Cdn gov't is making a bold move to tell 1st home buyers that they are willing to take the risk in lending. Again:

"Buyers don’t have to make ongoing payments and are not charged interest on the loan. But they do have to repay the incentive, either when they sell the house, or after 25 years—whichever comes sooner. "
Overall this does sound fairly similar to what we have. We don't have shared equity, but we have the rent to buy scheme (not that the details are clear on that)

Rent to buy instead of Shared equity,
5% deposit with govt insured loan, check, with price and income caps, check
Second chancers included, check.
NZ gets the $5k (or $10k for new build) )per person grant as well, again, income and price caps apply.

But the big problem is both of these schemes are just going to spur more demand, which will do what to prices? yeah, more demand = higher prices.
The solution isn't to give people money to help blow the bubble up further, its to increase supply and bring prices down.