The Great New Zealand Housing Disaster: Click on The Real Deal, below.
Why would you buy a home for $500k when you can build a new home for $200k at the city fringe? Answer: Because you can't build a home for $200k at the city fringe. Because the cost of land has been artificially inflated, and to the point of ridiculous. This is the heart of the reason why housing in New Zealand has been able to inflate to such extraordinary degrees. The supply response to increases in demand has been deliberately choked off. At base, this so-called complex issue really is that simple.