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Mōrena, and welcome to The Bulletin 

In today’s edition: Reserve Bank proposes minimum floor for cash services; Fears over biometric data in proposed US border deal. But first, how a 'truckload' of townhouse supply – especially in Christchurch and Auckland – is reshaping the housing market.

With Auckland and Christchurch 'awash' with new townhouses, some listings are remaining unsold for so long that they stop qualifying as new builds. (Photo: Getty Images)

Townhouses age out of ‘new build’ status

A curious twist has emerged in the housing slowdown: some newly built townhouses are sitting on the market so long they no longer qualify as new builds. In BusinessDesk (paywalled), Maria Slade reports that it’s having real consequences. To count as a new build, a property must have received its code compliance certificate within the past six months, never been lived in, and be purchased directly from the developer. That status allows first-home buyers to avoid loan-to-value restrictions and access low-deposit lending, including the government-backed First Home Loan scheme.

But with Auckland and Christchurch “awash” with townhouses, many listings are lingering beyond the six-month mark and “for every listing you might see on the websites … that masks maybe four or five others that are on the market for sale”, says Christchurch consultant Mike Blackburn. With ballooning supply, fewer of which are available to low-deposit buyers, some developers have reportedly shifted unsold units into rental pools or short-term accommodation, which also strips them of new-build eligibility. Nationally, townhouse median values have fallen 1.7% over the past year, compared with a 0.7% drop for standalone houses.

Auckland’s apartment overhang

The picture is even starker in Auckland’s apartment market. According to the NZ Herald’s Anne Gibson, citing CBRE research, 521 newly completed apartments remain unsold – around 20% of all units built in the past three years. Of those, 472 are in suburban projects, 42 in fringe locations and seven in the CBD.

While the absolute number represents just 1% of Auckland’s total apartment stock, the proportion relative to recent completions is “undoubtedly problematic”. Examples are wide-ranging. Ockham’s Whetū block in Pt Chev has been switched entirely to build-to-rent. In Takapuna, the 46-unit Loxley Apartments ended up in mortgagee sale after never being lived in. In the CBD, The Cab on Aotea Square still has dozens of units available, with the developer offering two-year suspended mortgages to attract buyers. 

Christchurch’s townhouse glut

Christchurch tells a different but related story. The city is leading the country for overall price growth, with average values up 2.5% in the three months to December. But in The Press, Blayne Slabbert reports that townhouses and apartments are facing clear “pricing pressure” as choosier buyers are faced with a wave of new stock. A quarter of Christchurch homes are now townhouses or terraced houses – the highest share in New Zealand – and about 21,000 have been consented over the past 20 years. More than half of new housing consents in the city are multi-unit dwellings.

On the ground, one real estate agent describes “a truckload” of new-build townhouses on the market, with hundreds listed online. Those that sell quickly have garages and plenty of storage; those that don’t sell are languishing on Trade Me for months. 

The Horncastle factor

One of the key figures behind the townhouse boom is Christchurch-based Matthew Horncastle, CEO of property developer Williams Corporation. In a great (paywalled) BusinessDesk profile by Cécile Meier, Horncastle rejects the idea that the city has overbuilt. His co-owner Blair Chappell says it is “definitely no harder” to sell townhouses now than a year or two ago, and that the firm is still hunting for development land. The company intends to list on the stock exchange in 2027, with Horncastle planning to remain chief executive for at least five years post-IPO before potentially moving into politics.

At the same time, Horncastle has become notorious for his combative, liberal-bating social media posts. For example: “I see no difference in values between Adolf Hitler and the political left." As Meier writes, things Horncastle “has deemed bad, evil even” include taxes, Jacinda Ardern, beneficiaries, net-zero carbon targets, fluoride, left-wing voters (“mentally ill”) and men wearing shorts at work. 

According to one anonymous property commentator, Horncastle’s passion for posting may become an issue for investors as the IPO approaches: “Is that the sort of thing I want to invest in? Do I believe that this person can run a serious business if they are ranting like this on social media?”

Reserve Bank proposes minimum floor for cash services

The Reserve Bank wants to set a minimum “floor” for cash services that banks must provide, reports Rob Stock of The Post. The proposal would require 95% of urban residents to live within a 3km walk of free cash services, and 95% of people in rural settlements to be within a “reasonable” drive.

To meet the standard, banks may need to collaborate on up to 1300 service points, including multi-bank hubs and smart ATM depots. The Reserve Bank estimates the plan would cost banks about $104 million a year, but says the wider economic benefit could reach $2.85 billion.

Ian Woolford, the Reserve Bank’s director of money and cash, said access to cash formed part of banks’ social contract, particularly during natural disasters and payment outages. While cash use has declined, Woolford does not expect it to disappear, even as 40% of bank branches have closed in the past decade, contributing to emerging “cash deserts”, especially in rural communities.

Fears over biometric data in proposed US border deal

New Zealanders’ biometric and other sensitive information could be shared with the United States under a proposed border agreement, RNZ’s Keiller MacDuff reports. The Ministry of Foreign Affairs and Trade confirmed it is negotiating an Enhanced Border Security Partnership with the US, which has told visa waiver programme countries they must conclude talks by year’s end or risk losing visa-free travel.

Concerns centre on whether data might be accessed by US Immigration and Customs Enforcement (ICE), and what safeguards would apply once information leaves New Zealand’s control. Green MP Teanau Tuiono has called for parliamentary oversight of the decision, while Māori data sovereignty expert Dr Karaitiana Taiuru said sharing DNA data, which is considered a taonga, raised particular cultural concerns.

Council of Civil Liberties chair Thomas Beagle described the proposal as far more invasive than current arrangements. "Some people are still locked in the past where the US was a reasonably benign ally of New Zealand, and that's becoming less and less true," he said. "We wouldn't give other countries like China or Russia full access into our police and biometrics databases, would we?"

Click and collect

• Children 12 and under will be able to cycle on footpaths, mandatory passing gaps for motorists overtaking cyclists will be introduced, and drivers will be required to give way to buses pulling out from stops, as part of the government's new set of proposed road rules. (Stuff)

• A car clamping initiative targeting people who have not paid their court fines has returned more than $700,000 so far, and is being expanded. (RNZ)

• Alcohol consumption in NZ is at its lowest level since Stats NZ records began 15 years ago. (NZ Herald) 

• "Unreasonably disruptive" protests outside the prime minister’s official residence could lead to criminal charges, after the justice committee decided not to exclude such high-profile properties from a ban on demonstrations outside private homes. (Newsroom)

Right now on The Spinoff

• Toby Manhire on what the surge in populist nationalism means for Winston Peters and NZ First
• The National Library still hasn’t paid hundreds of authors. It has ‘no definitive timeframe’ for a fix, reports Henry Oliver
• One MP, One Pint: Nicola Willis on being a mum, a meme and a minister
• 'I want my young readers to feel empowered': David Hill's life in books
• What does the latest twist in the US tariff saga mean for New Zealand exporters? Shanti Mathias investigates
• Why artist-advocate Fonotī Pati Umaga doesn’t want to be your inspiration

Thanks for reading. 

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