Housing formed one of the main cornerstones of the government’s budget. The announcements were dominated by demand-side measures, the most prominent of which was to make gains from the sale of any residential investment property within two years of purchase taxable.

Others included requirements for overseas buyers to supply enough information to IRD and the banks that a de facto register of foreign property investors could be put together. The government even hinted that a withholding tax for non‑residents selling residential property might be on the cards.

The announcements are a political masterstroke as they have reduced the property cudgel, which opposition parties have been using to bash the government, to toothpicks. Practically, however, we remain sceptical. Without meaningful measures to address the constraints that local planning laws place on land supply, the $122 million spent on social housing, improving housing outcomes for Mâori, and the release of Crown-owned land in Auckland will count for little.

Supply is needed, and this is one way to tackle the problem.