OPINION: The great thing about a million-dollar mortgage is how easy it makes it to do the maths.

If interest rates go up by two per cent – you ask yourself – how crippling will that be? Easy! Four per cent, well that's $40,000 a year in interest. Six per cent, that would be $60,000 a year in interest.

Just interest. On a million dollars. Not even one dollar of principal repayment on – what's the number again? A million.

I've been doing some work in the consumer finance area. People talk about million-dollar mortgages like they're no big deal. It's what you do if you live in the leafier parts of Auckland. Perhaps the guy next door makes you feel better about it by going on his radio show and telling everyone this is a golden age.

I take another slug of my trim latte. I think: this is just completely insane.

READ MORE:

* Leave it all on the field

* Pencils at the ready, please...

What we need is a clear-eyed politician to tell us the facts:

"It wasn't so long ago, in the 1990s, in fact, that New Zealand had a high level of home ownership compared to other countries. Not so anymore. We now have what has been described as the second-worst housing affordability problem in the world."

Who is this man telling undeniable truths? That would be John Key, in 2007, rightly lamenting how the government had been snoozing while capital gains went nuts.

If only he could have become prime minister a year later and stopped the madness.

He says they have a comprehensive plan, and they're doing many good things. Well, that's good to hear but they've had eight years now and, really, just look at the numbers.

Average price of an Auckland home: one million dollars. Average annual income of an average Aucklander: 75k or so.

Once upon a time you could buy an ordinary home in "place desired by many" for three times your ordinary income. Let's pause while all of young and not so young Auckland laughs bitterly.

Once upon a time you could pay a rent that wasn't almost all your weekly pay, and get something better than a mouldy dump. Once upon a time we didn't have people living in cars, and garages and 10 and 20 people sharing a house built for five, and for crying out loud, we got this all fixed after the depression.

Maybe the government is still thinking "the problem is red tape and land supply and sooner or later we'll get a right-wing Auckland mayor who will grasp this undeniable truth and the city will be able to sprawl to Hamilton and somehow the infrastructure will magically pay for itself and then everyone will see that we were right all along."

Or maybe the government is thinking: "a lot of people are wealthier because we did nothing to stop the mania, and let's keep doing that, because those people really like us, especially on election day".

What will happen, everyone asks? Will there be more lovely capital gain? Will our kids be able to afford a house?

Will we ever see the inherent contradictions in those two expectations?

The Reserve Bank cleared its throat this week and reminded everyone: interest rates can go up. They didn't have to spell it out: what might that do to highly stretched people? The jaded part of me thinks a correction might do us good. My more human part thinks: there would be a lot of hurt in that.

The best solution seems to be an abundance of affordable apartments, all over the city. A new kind of home for a new generation.

But can they be affordable? Or will they go in just the same direction as today's ordinary Auckland houses? Looking at everything we know about how people behave in the auction rooms on Friday morning, how much do you want to bet the market won't carry apartment prices skywards?

Can we not be more like Singapore, where the government takes the sort of active role that ours did after the depression? What's so wrong with saying "we're going to step outside the market because the market is completely dysfunctional."

This spectator government has failed us. Homes are unaffordable. You cannot just shrug, you cannot just leave it to the market. You cannot, because that is how you end up with million-dollar mortgages.