Today the Herald published a number of stories about:
The first picture has emerged of Chinese buying patterns in Auckland’s pressure-cooker housing market — and it suggests a powerful, big-spending influence.
Real-estate figures leaked to the Labour Party, which cover almost 4,000 house sales by one unidentified firm from February to April, indicate that people of Chinese descent accounted for 39.5 per cent of the transactions in the city in that period.
Yet Census 2013 data shows ethnic Chinese who are New Zealand residents or citizens account for just 9 per cent of Auckland’s population.
Let me back way up here and talk about what’s driving (some) of the interest in Chinese investment in Auckland property. Back in 2008 New Zealand signed a free trade deal with China. They quickly became our largest export market. We’ve never had a relationship like that with a country like China before. Their economy is more than fifty times larger than ours. It’s been growing at an insane rate, and it’s heavily protected but slowly opening up (the boom and bust in their stock exchange in the last few months is due to the recent legalisation of margin trading). We’re like a goldfish swimming alongside an aircraft carrier.
So our new relationship with China is going to impact on New Zealand and our unusually unprotected and unregulated economy in lots of different ways that no one predicted when the trade agreement was signed. Some of them might be good, others might be bad. A lot of people suspect that’s what’s happening in the Auckland property bubble – which almost everyone agrees is bad – is that speculation from investors in China are driving the price increases. But there’s been no way to tell because until a couple weeks ago the government refused to collect data on the residential status of property investors. All of the arguments have been based on anecdotal evidence which National has always dismissed as race-baiting.
Labour reckons that their leaked real estate data indicates that a large number of home buyers are Chinese, disproportionate to the population. The problem with that, as people have been tweeting at them all day, is that their statistical analysis also captures (a) New Zealanders of Chinese descent and (b) migrants from China, all of whom have as much right to buy houses in New Zealand as anyone, but the tenor of the stories strongly implies that they don’t, and that there’s something wrong with people from those groups buying houses in Auckland.
Politicians know that this kind of race-baiting really resonates with a huge section of the population. This is a country in which people were confiscating car keys off Asian drivers just a few months ago with the media and police cheering them on. So when a politician says ‘I’m not trying to be racist . . .’ and then says something that lots of Chinese people find deeply offensive I don’t think they should have the benefit of the doubt. It’s not up to Twyford (or me) to say whether he’s being racist or not – that’s a decision for Chinese New Zealanders, and a lot of them seem very offended. And in these cases the offense is usually intended. It’s baked into these kinds of tactics – accusations of racism ‘close the circuit’ in comms speak and amplify the story, winning sympathy with voters who think that the big race problem in New Zealand is white people being falsely accused of racism.
On the other hand, I do find the logic of what Labour are trying to say fairly convincing. In his post Keith converts the percentages in Labour’s analysis into raw numbers and seems to think that demolishes Twyford’s argument, but I think he’s wrong. I haven’t done a big fancy regression analysis to figure out the likelihood that the sales in Labour’s dataset can be accounted for by Auckland’s resident ethnically Chinese population, but I think the chance is very small. Maybe Labour’s right? Maybe a lot of the buyers in their data are foreign based Chinese investors?
Unfortunately we can’t tell based on what we’ve got. But we do need to figure out a way to talk about the ongoing impact of China on New Zealand without (a) the entire conversation being written off as racist or (b) offending Chinese New Zealanders. Feels like Labour’s just set us back aways there.