A profitable housing policy? The privatization of the New Zealand Government's residential mortgage portfolio

Home ownership occupies a dominant housing position in the housing markets of many countries. For Saunders, 1990, the success of home ownership reflects the outworking of a popular demand for a tenure that confers both financial and ontological security to individual owners. Yet, home ownership evolves within the context of nationally constituted structures of provision that are altered and conditioned by temporally specific housing policies and housing finance regimes (Ball et al., 1988; Murphy, 1995). The growth of home ownership in countries such as the US, the UK, Canada, Ireland, Australia and New Zealand owes much to housing policy frameworks that have favoured this tenure through either favourable tax regimes or the support of sheltered circuits of mortgage finance. While much attention has been directed toward the socio-economic impacts of reforms in the social rented housing sector, it is arguable that the changing role of state involvement in terms of home ownership will have profound social and economic impacts on this sector (Ball et al., 1988). This article charts the New Zealand Government's long term involvement and post-1990 disengagement from the direct provision of mortgage finance as part of a wider housing and economic agenda that privileges private market provision, profit and government debt reduction. It is argued that, while the housing policies of the 1990s have secured considerable short term benefits for the state, the long term implications for home ownership remain problematic.