At the National Party conference last weekend there were a number of announcements around housing; some were helpful, and some were less helpful.

The well-reported aspects of the housing announcement have been an increase in the availability of Kiwisaver subsidies and the expansion of ‘Welcome Home’ loans.

Currently, you can claim up to a $5,000 subsidy from Kiwisaver for a first home, with a joint income of $100,000 on a house up to $400,000. This is being increased to an income level of $120,000 on a house priced in Auckland at $485,000.

Despite their prominence in news reports, these policy changes will do nothing to help housing affordability, or to build a single new house. It will make potential purchasers feel a bit better – but the extra subsidy will be absorbed within the price of the house. In fact, it is extending what amounts to a cash hand-out to vendors from taxpayers, mediated through homebuyers, and is poor policy.

‘Free’ cash always seems like a good deal to its recipients. People looking to sell, particularly in the first homebuyer market should be happy; the government has just bumped up their likely sale price.

The Australian equivalent of this, the ‘first time homebuyers’ grant, is widely considered to be poor policy that doesn’t achieve its objective.

Although the headline reform is for councils to have a 10 years’ supply of residential land in their local plan, this is not the most important change. Indeed, this change is unlikely to make much difference. Under the Auckland Unitary Plan, Auckland already has an (albeit, theoretical) similar buffer.

Useful changes to the Act to make virtually all subdivisions non-notified, and this is a positive step forward. This means that if a given subdivision complies with the relevant plan development can go ahead without any extra planning processes. Fixed-fee consents and application processing timelines are also being introduced, as is a sped-up process for small additions to homes, such as a new deck. This is low-hanging fruit, but it is a welcome change regardless.

Long-term supply-side reform is important for the housing market, but the government should avoid the temptation to subsidise people into homes.