New Zealand's Property-Industrial Complex: A democratic warning
- Grant McLachlan - Column
- 5 days ago
- 4 min read
In his 1961 farewell address, President Eisenhower warned America about the military-industrial complex. In 2024, New Zealand faces its own existential threat: the property-industrial complex has consumed our democracy whole.
Turn on your television. Flip past the news—if you can find it between the renovation shows. There’s Location, Location, Location NZ, sponsored by AA Insurance. Rich Listers, starring former Deputy Prime Minister Paula Bennett flogging luxury real estate. House Hunt, The Block NZ, imported property pornography filling primetime slots once reserved for journalism and drama.
Look at your rugby jersey. Where Australian teams sport global brands like Emirates and Vodafone, New Zealand’s All Blacks and provincial sides are plastered with local contractors, real estate agencies, building material suppliers. Our kids’ school fairs? Sponsored by Barfoot & Thompson. Community sports clubs? Brought to you by your friendly neighbourhood property developer.
This isn’t coincidental. It’s systemic capture.
Construction now represents 6.3% of New Zealand’s GDP—$17.6 billion annually. Add in the entire ecosystem: quarrying, building materials, retailers, consultants, council staff processing consents, real estate agents, plumbers, builders, electricians, contractors, car dealers selling utes to tradies, mortgage brokers, banks, insurance companies.
Economist Bernard Hickey nailed it:
“We don’t have a real economy, we have a housing market with bits tacked on.”
The property sector doesn’t just dominate our economy—it owns our politics. Since 2021, property industry donors have pumped over $2.5 million into political parties. National received $1.3 million from property interests alone. The three parties forming our current government—National, ACT, and NZ First—banked $16.5 million in total donations in 2023, with property developers featuring prominently among the mega-donors.
Property developer Mark Wyborn: $300,000 across National, ACT, and NZ First. Trevor Farmer: $300,000. Chris Meehan of Winton (fighting for his 5,000-property Sunfield development): $103,260 to National, $50,000 to ACT. Vlad Barbalich: $145,000 to NZ First. The list reads like a who’s who of developers seeking fast-track consents, rezoning decisions, and infrastructure commitments.
And they’re getting what they paid for. The fast-track consenting legislation—which either cuts red tape or constitutes environmental vandalism, depending on your perspective—has property developers’ fingerprints all over it. Of the 182 organisations that received letters about the fast-track applications process, property developers formed the second-largest group. Winton, whose owners donated over $150,000 to the coalition parties, is on that list.
The media’s complicity is total. Property advertising and sponsorship represents the largest revenue stream for New Zealand media organisations. When celebrity homes go on the market—including journalists’ homes—it’s treated as news. “Home of the Year” features receive prime attention. The property market gets more airtime than climate change. Investigative journalism about housing policy? Vanishingly rare when your advertisers are the industry you’re meant to scrutinise.
Scripted television and long-form journalism have been replaced by property renovation contests and real estate reality shows. The message is relentless: your home isn’t a place to live—it’s an investment vehicle, a retirement plan, a ticket to wealth. Every episode is an advertisement for the Ponzi scheme.
At the local government level, the capture is even more complete. Councillors receiving campaign donations from developers vote on their consent applications. Council budgets balloon with property valuations, yet infrastructure chronically lags population growth driven by... the property development lobby demanding more immigration to fuel demand.
Central government treats speculative property developments with the same priority as essential infrastructure. Roads get built to service greenfield subdivisions while hospitals crumble. The government allocates $71 billion for infrastructure over five years, but much of it serves one purpose: enabling more property development.
Banks have become property speculation enablers rather than productive business lenders. Over 60% of bank lending goes to residential mortgages. The Reserve Bank, hamstrung by a CPI that excludes housing costs, kept interest rates artificially low while house prices spiralled—creating a feedback loop that rewarded speculation and punished savers.
The regulators who should be calling this out? Silent. The Financial Markets Authority, the Commerce Commission, even the Reserve Bank acknowledge the problems in academic papers while taking no meaningful action. Why? Because acknowledging the property market as a Ponzi scheme would crash the entire economy.
This is Eisenhower’s warning made manifest. Where America faced the military-industrial complex steering foreign policy toward endless war, New Zealand faces the property-industrial complex steering every policy decision toward sustaining inflated house prices. Immigration policy? Calibrated to fuel demand. Monetary policy? Blinded by a CPI that excludes housing. Infrastructure spending? Directed toward enabling sprawl. Media coverage? Bought and paid for.
The result is a society where home ownership has dropped from 74% to 65%, where young New Zealanders emigrate in record numbers (56,500 citizens left in the year to April 2024), where homelessness is endemic, where the waiting list for public housing exceeds 25,000 families.
President Eisenhower warned:
“We must guard against the acquisition of unwarranted influence, whether sought or unsought, by the military-industrial complex.”
For New Zealand, substitute “property-industrial complex,” and the warning becomes prophecy.
The property industry has infiltrated every institution: government, media, sports, schools, churches, community groups. Its tentacles reach into every aspect of life. And like any successful parasite, it has convinced the host that its survival depends on feeding it.
Until we recognise this capture for what it is—a democratic crisis masquerading as economic policy—we’ll continue sacrificing our future on the altar of house price inflation. The property-industrial complex doesn’t care about housing New Zealanders. It cares about sustaining the greatest wealth transfer in our nation’s history: from earners to asset holders, from young to old, from productive enterprise to speculation.
Eisenhower’s warning was clear: eternal vigilance is the price of liberty. We stopped being vigilant. Now we’re paying the price.
