HOT TOPICS:   Election 2014  |  Dairy prices   | Housing affordability                                                      RESOURCES:    Economic calendar   |  Rent ratio

The comment stream

Reader poll

What's the most likely election outcome?

Choices

No quick fixes for complex, deep-seated and serious housing affordability issues, Finance Minister English says; Eyes response to Productivity Commission

Posted in Property
See video

By Alex Tarrant

A lack of affordable housing in New Zealand is a deep-seated, complex, and serious problem for which there are no quick fixes, Finance Minister Bill English says.

But the government was determined to follow up on recommendations made by the Productivity Commission on housing affordability to deal with the shortfall, particularly in Auckland, he said.

The headline recommendation in that report was for the immediate release of land for residential development on the outskirts of Auckland and Christchurch to alleviate land supply and cost issues.

It also recommended the government should look at ways to reduce building costs and timeframes, allow for greater scale of residential building, and look for ways to allow for low-cost 'brownfields' development within city limits.

In Question Time in Parliament on Tuesday, English said the government was about to release a "multi-pronged work programme" in response to the report. See Alex Tarrant's July article, Wholesale changes to how government approaches housing affordability as it drops helping demand and focuses on supply side.

English said investment in New Zealand was skewed towards housing. Allowing for more affordable housing would mean the private sector was less indebted to foreign lenders, which would help get New Zealand out of a highly-indebted club of countries facing problems stemming from their external liabilities.

It would also help the government's finances by taking pressure off income-related rents and accommodation supplement payments, while having less indebted households would be beneficial for the economy.

English noted the largest opportunity to provide more affordable housing within Auckland's city limits was in the government's hands due to its land holdings for state homes. This follows comments he made to interest.co.nz on this in August

Earlier this year Housing Minister Phil Heatley announced a redevelopment plan for the Tamaki area in Auckland, in which Housing New Zealand owns 56% of the housing stock. The plan was to densify the area more by subdividing the current quarter and half-acre sections state homes sat on, with private enterprise and social housing providers contributing the funding.

Unaffordable

English noted this year’s Annual Demographia International Housing Affordability Survey showed that the cost of a median-priced house in New Zealand was 5.2 times median income, and in Auckland 6.4 times median income.

“Any ratio above 5 is considered unaffordable," English said.

For more on the Demographia survey, see the website of its New Zealand representative, Hugh Pavletich, http://www.performanceurbanplanning.org/.

“We share the Productivity Commission’s view that the housing market is not working properly. For example, despite demand for low cost houses, relatively few are being built, in part because of the very high cost of land, particularly in Auckland," English said.

“Constrained supply and high prices for housing in turn force high levels of household borrowing [which is] detrimental to households and the economy," he said.

More affordable housing would mean less debt owed to foreign lenders.

“We are ranked along with the heavily indebted European countries when it comes to that measure," English said.

Housing loans comprised 93% of household liabilities in New Zealand.

“[And] as rents rise, this pushes up the cost to government of income-related rents and [the] Accommodation Supplement. For instance, income-related rents are forecast to rise by 30% over the next four years, which will cost the government around NZ$200 million per year," English said.

Seven new residents for each new Auckland dwelling

English noted the latest Massey University Home Affordability report, which he said showed an improvement in affordability over the last 12 months in all regions except Auckland.

“Massey says that the reason prices are increasing faster in Auckland than other regions is because of an imbalance of new housing supply to meet demand from increasing population," he said.

The latest Roost Home Loan Affordability monthly report, compiled by interest.co.nz, shows home loan affordability worsened slightly in August as the national median house price rose again to near a record high, more than offsetting record low interest rates. Affordability deteriorated for Auckland, Wellington, Nelson/ Marlborough, Canterbury, Central Otago/Lakes and Southland because of higher median house prices, while affordability improved in Manawatu/Wanganui and Otago due to lower median prices. See more here.

In July, Westpac economists noted that over the three years to June 2011, for every new dwelling in Auckland, the city's population increased by seven new residents.

English also noted the latest Quotable Value report, which showed nationwide house values were up 1.8% in the last three months, and 5.3% over the past year.

“These reports confirm that even in a slow economy, housing affordability remains a deep-seated, complex, and serious problem. There are no quick fixes but the government is determined to follow up on the Productivity Commission report and make progress," English said.

Labour Party housing spokeswoman Annette King asked English whether he had seen comments from Auckland Mayor Len Brown that the council believed there was enough land to build 18,000 new homes right now, but needed a partnership with central government to provide up-front capital to build affordable homes.

“If so, does his government intend to put their money where their mouth is in their work programme, and help get these new homes built as soon as possible?” King asked.

English said the government was working closely in partnership with the Auckland Council around progress with the Tamaki redevelopment, which was “the largest opportunity for brownfields redevelopment within Auckland City."

“It is a novel suggestion that the government would provide capital for property development on the fringes of Auckland. We are working with the Council to...answer the question of whether the availability of those sections is sufficient to enable actual sections to be available for people to buy," English said.

“This is part of the complexity of the issue. Government is making sure it understands them properly by working closely with councils," he said.

See comments from Housing Minister Phil Heatley on the Tamaki redevelopment in the video below:

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

We welcome your comments below. If you are not already registered, please register to comment in the box on the right or click on the "'Register" link at the bottom of the comments.

Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current Comment policy is here.

92 Comments

bill is being disingenuous as

bill is being disingenuous as usual by trying to cast a fog over the a simple problem - "it's a deep-seated, complex, and serious problem for which there are no quick fixes". That's bulderdash. It's a simple problem of demand and supply.
To reduce demand slow immigration to meet available housing supply, fix all the tax loopholes and breaks on propertry speculation, bring back the core funding ratio that has been sidelined, reduce accomodation subisidies, make locals only able residential property etc...etc...
To increase supply loosen the draconian residential land supply restrictions in cities, stop all the gouging from the councils to do subdivisions, change accomodation subsidy to a supply side subsidy to build more houses etc...etc....
Simple as a ham sandwich. The real problem is National don't want to do it. 
 

also 60% of MP's own

also 60% of MP's own multiple/rental properties and therefore have a direct interest in housing NOT becoming more affordable.

that may be part of it

that may be part of it Vanderlei. However I think wtf has nailed it below. It's political cost they're most worried about i,e, losing their jobs by doing the right thing

Bang on but successive

Bang on but successive governments have let the bubble inflate to the point where they can't implement any of these without negatively affecting existing home owners. Better to do nothing and let it collapse of its own accord and hopefully blame it on something "out of their control"
 
Imagine the split in the population if a political party explicitly said we're going to implement policies which bring down property prices by 50%.

The thing is wtf, most

The thing is wtf, most homeowners are sitting on notional gains that they haven't earned, just inflated the value of the property they're sitting on. How many have loans taken out into the inflated market? That's the real question in terms of any real economic damage. My finger in the air guess would be less than 10% of homeowners. 
The other side of the coin to this problem is economic devastation on a number of fronts. Housing is the single biggest cost in the household budget. See Statistics NZ Household expenditure surveys. By letting it inflate it drives many people into poverty. It also diverts the capital of the the country into an unproductive area, damaging growth. 
It's totally irrepsonsible of the government to let this carry on apace as they have been doing.

Your dam right rp. NZ

Your dam right rp. NZ property market is killing NZds peoples future.

Ban the foreign landlords,

Ban the foreign landlords, absolutely.
Allow builders to have "bulk approved" several simple floors plan for lower cost housing. The only reason then for more hoops to be jumped through would then be if the land these houses were being built on required special attention, say in the way of engineers' reports etc.
We have got to get away from the McMansion concept to be able to provide lower cost housing. Micro housing is another option, for one or two people. Modular housing as well, that can be easily added on to as families grow

Then why give Auckalnd

Then why give Auckalnd Council more power??

Hon Bill English sais

Hon Bill English sais incorrectly the affordability limit is 5, when it should have been 3.
 
I look forward to this long overdue majoe announcement.
 
Well done Alex for (again) a superb article.
 
Note too ... Rob Stock in the Sunday Star Times report of three Sundays ago ... GOVT TO TARGET CITY FRINGE FOR CHEAP HOUSING ...
 
 
Govt to target city fringe for cheap housing | Stuff.co.nz
 
 
http://www.stuff.co.nz/auckland/local-news/7780376/Govt-to-target-city-fringe-for-cheap-housing
 
 
There is further extensive background material at www.PerformanceUrbanPlanning.org and http://www.facebook.com/CantabriansUnite . there is a very long history to all this.
 
 
It is set out clearly what needs to happen with respect to Christchurch within CHRISTCHURCH: THE WAY FORWARD (specifically Section 4 Affordable Land ) ...
 
 
Christchurch: The Way Forward | Scoop News
 
 
http://www.scoop.co.nz/stories/AK1206/S00251/christchurch-the-way-forward.htm
 
 
 
 
Hugh Pavletich

Nice to see your efforts are

Nice to see your efforts are getting through to some extent though Hugh. Well done.

Roger - thank you for your

Roger - thank you for your kind comments.
 
A near 8 year 20,000 hours "political project" on this one - following on from others as noted in this brief bio below...
 
http://www.cantabriansunite.co.nz/Hugh-Pavletich/
 
 
We will know by the latest next Wednesday night.
 
 
The country cannot afford for them to fail again this time – as they did following thwe 08 election. This is their "last chance:”.....and likely New Zealand’s too ...
 
 
Hugh Pavletich
 
 

Was that " 5 " a slip of the

Was that " 5 " a slip of the tongue by Wild Bill , or do you think he's seriously ignorant of what the affordability index means ?
 
Hugh for PM , say I ! ..... time to roll out the Hugh P. Party !!!

GBH - Settle down old chap.

GBH - Settle down old chap. You know I lack "Wild Bills" charisma - for me to be a politician.  I had "charisma bypass surgery" long ago.
 
I think in oozing so much "Kiwi Charisma" (talk about the Passionless People) in delivering that speech in the Parliament, he inadvertently omitted the word "severely".
 
You just watch that "Dipton Passion" bubble to the surface within the week !
 
I have heaps of updated comments throughout this thread ...
 
Hugh Pavletich

as long as people are

as long as people are prepared to pay top dollar for a pieces of wood held together by nails then property will always be expensive.
the fact is that the price of a house in auckland will not come down even though they are overvalued by as much as 20 to 30%

There are two problems at the

There are two problems at the interface;
 
the need for farming, and the price per acre it can support, plus the sensible though that prime agricultural land (they're not making any more of it) should be protected.
 
Then there's the increasing cost/logistics of distance from hub, coupled with the increasing real cost of infrastructure. Councils rightly either require a subdivision to pay for itself (increasingly 'expensive') or for self-sufficient blocks (lifestyle type) to be self-contained service-wise.
 
Never again will we see Hugheys precious Multiple, and I suspect the Minister knows it. The Tamaki comment suggests so.
 
But if Big Dairy crumbles, then a re-look at small rural hubs (village/town) makes much more sense. The need to service the resulting smaller rural lots will require local-ler labour, which fits.

PDK – Murray Grimwood – sorry

PDK – Murray Grimwood – sorry to disappoint you old chap, but Pavletich and the Annual Demographia Surveys are going to be around for a very long time to come. The Demographia Survey is now seen as the “gold standard” for assessing housing affordability within the Anglo world. There were about 300,000 downloads of it in the first week following release late January this year with the 8th Annual Edition.
 
 
Go check out the Landcare research reported here on Interest Co back January this year, that found the numbers of lifestyle blocks has exploded these past 13 years nationally from 100,000 to 165,000.
 
 
These now “consume” about 8,700 square kilometres of our land area. Our urban areas are just slightly less than 2,000 square kilometres – slightly less than 0.70% of our toral land area.
 
 
This flight is mainly because people are being forced fro the cities in their quest for affordable land. The disruption costs are truly enormous.
 
 
And please don’t bore us about Loser Local Governments “problems” with infrastructure. These guys couldn’t run a bath. The MAJOR problem is that their costs are out of control.
 
The housing affordability problem at its core is a “Local Government Costs Out Of Control Problem”. We need to see some key structural changes made, so that these losers perform to an acceptable standard.
 
 
Hugh Pavletich

Out of control? rteally? and

Out of control? rteally? and yet when developers want to make 100%+ thats not out of control?
yeah right.
regards

Dear Steven,   If you are so

Dear Steven,
 
If you are so sure and confident that developers can make 100%+ on their project, why not try your hand at it ???
 
regards

Kin, Ive delt with developers

Kin, Ive delt with developers who have said this.
Besides which lets hear Hugh and the developers he knows deny they aim for such a profit margin.  They critisise other parts of the equation readily.....yet it seems stay silent on other just as bloated if not more so aspects.
No I dont do it as my skill set isnt in [project] management its technical...
regards

HughP - the fact that the

HughP - the fact that the Minister refers to you, reinforces that you are wrong.
 
He was recorded as mentioning 'sustainable growth', on a Nat Radio news clip not long ago, so that rules Bill English out, cred wise. There is no such animal as siustainable growth, and the media is overdue pointing this out.
 
Your problem is that the paradigm has changed, for reasons I've told you often enough. Looking backwards doesn't guarantee what happens forwards, and don't ever say you weren't told.
 
It was always obvious that the Minister, the P Comm, and you, were in a line. Trouble was, they were all in the wrong'un.
 
Gonna be interesting watching the Minister juggling voters who think they're 'wealthy' 'cos of their 'house value', versus what you're aiming at, though. Oh the angst.... The Pollies won't go there...... watch thou for the fudge.

or indeed Treasury that

or indeed Treasury that neo-classical bastion of useless telling us all we are "wealthy" because of our home values and have heaps of "savings".
oh dear...
oh boy, when it dawns on joe and jane voter that they have to start seriously saving en-mass for their retirement and that they wont get much if any interest and that it will be at some risk....
Of course Pollies wont go there....its 100% lose....no one wants to tell that message. We've employed too many "positive people" who have no grasp of reality for too long to want to listen to anything else but spin and PR so we feel safe......
regards
 

But if Big Dairy crumbles,

But if Big Dairy crumbles, then a re-look at small rural hubs (village/town) makes much more sense. The need to service the resulting smaller rural lots will require local-ler labour, which fits.
 
Close to Frank Lloyd Wright's Broadacre vision for American urban expansion - although he placed alot of emphasis on the motorcar's place in that vision.  But he wasn't into large land holdings - 1 acre as the standard if I recall correctly - enough to provide your own services, to grow your own vegetables; keep chickens and perhaps a pig and/or a house cow.
 
It would be interesting to see a struggling small NZ town take such a planning approach. 

Animal lover - obviously you

Animal lover - obviously you are still confused about what a NORMAl and affordable housing market is .... after near 8 long years discussing these issues. Phew... some are slow learners.
 
here is the clear Denition off the front page of the www.PerformanceUrbanPlanning.org website ..... again ....
 

DEFINITION OF AN AFFORDABLE HOUSING MARKET
 
For metropolitan areas to rate as 'affordable' and ensure that housing bubbles are not triggered, housing prices should not exceed three times gross annual household earnings. To allow this to occur, new starter housing of an acceptable quality to the purchasers, with associated commercial and industrial development, must be allowed to be provided on the urban fringes at 2.5 times the gross annual median household income of that urban market (refer Demographia Survey Schedules for guidance).
 
The critically important Development Ratios for this new fringe starter housing, should be 17 - 23% serviced lot / section cost - the balance the actual housing construction.
 
Ideally through a normal building cycle, the Median Multiple should move from a Floor Multiple of 2.3, through a Swing Multiple of 2.5 to a Ceiling Multiple of 2.7 - to ensure maximum stability and optimal medium and long term performance of the residential construction sector.
 
May I suggest you commit the above to memory pior to Hon Bill English's announcement.
 
Hugh Pavletich
 
 
 

There are some quick fixes Mr

There are some quick fixes Mr English.
 
1. In ChCh focus on ways to relocate as many red zone houses as possible to land where extensive foundation systems are not required.  The average 250m2 modern home could be up and running on an alternate site for $100k plus land.  That means the cost of these homes could potentially be under $250k, versus a market price of $500k.  They need some plans in place, the powers that be are either blind to reality or incompetent.  Other properties could be shifted to regional South Island centres as well.
 
2. In Auckland sell all old state houses in the Central suburbs.  Don't try to redevelop these areas for public housing.  Replace these houses with brand new, quality public housing in the outer suburbs, or brownfields suburbs with vacant land in outer areas.  Some ex central states could be relocated and renovated.
 
There is ZERO net cost to the Government in doing this, as in ChCh the relocation of houses would be profitable, and in Auckland the building of new homes would be more than adequately covered by the sale of the existing ones on the open market.
 
In both cases it would definitely be a revenue boost for government, probably (as outlined previously) in the order of a billion dollars in benefit to the government per annum (through cash released in sales and extra tax revenue from the private expenditure and job creation).
 
Are the Nats so dim that they cannot see that there are easy solutions??

please go into politics

please go into politics Chrisj or hound your local MPs with this. These are great ideas.

2. In Auckland sell all old

2. In Auckland sell all old state houses in the Central suburbs.  Don't try to redevelop these areas for public housing.  Replace these houses with brand new, quality public housing in the outer suburbs, or brownfields suburbs with vacant land in outer areas.  Some ex central states could be relocated and renovated.
 
Why not instead - sell state housing stock in Otara and further out suburbs - as these properties would be affordable for private sector first home buyers and also attractive to rental property owners.  Then use those proceeds to intensify public housing on those government owned sections in the central suburbs.  That way the government-owned property valuations increase with the market for centrally located properties.
 
Why should government sell out of its best assets - and at the same time create the potential for future slums?  No where in the world has concentrated areas of public housing not gone down that slum route in the longer term.  Important to avoid that 'model' going forward.
 
 
 
 

Why would the Government want

Why would the Government want to reduce the value of the properties it owns by building new public housing in what are already desirable central suburbs?
 
The goal should be to turn Otara from a ghetto into a nice neighbourhood.  It owns most of the land, so building quality new houses in the area and refurbishing the rest could achieve this. Given the low density of these brownfields areas, it should be possible to add 20 or 30% more dwelling whilst keeping a garden suburb approach.
 
Imagine regeneration in Otara and Mangere into desirable neighbourhoods where state house tenants would want to live - it would do a lot to solve crime and social issues too.  A win-win at zero cost (paid for by the sale of state houses in desirable areas).

What are you going to do with

What are you going to do with a piece of Remuera land if you don't re-develop it??  Let it rot?

Do you want public housing in

Do you want public housing in Remuera, doublegz??  I say sell it on the open market.  $1.3m per state house could build 5 houses on state land in Auckland's outer suburbs.

In Christchurch the Govt

In Christchurch the Govt should buy land (an asset) and provide the sections on a 999 year lease at a very low rental to lessees to build on.  The Lessees should have the right to purchase over the term.

Why lease at all? Why not

Why lease at all?
Why not have the Govn purchase land at its fair agricultural rate as its at present zoned and afterwards re-zone it en-mass?
It has to be en-mass otherwise private land banks or developers will release it in small job lots to hold it up at a price they think ppl will pay.
Howerver that is just the start...
For instance this weekend I went and bought some 4x2 H3.2, Placemakers, $8.40 odd a metre, Bunnings $4.80 odd a metre and that isnt what a builder will be paying....its the retail price.
So one has to wonder how Placemakers can charge 100% clear above their competitiors price.
This also feeds into tools....
10 years ago I used to do "serious" DIY, at he end of my last project I could see a severe cost blowout in materials....it made no sense even with my free labour to continue significant improvements, there was no financial return.
So frankly house building is one of very fat margins end to end.....and that includes Hugh and his ilk who want 100% clear profit.
regards
 
 
 
 

English is fibbing , there is

English is fibbing , there is a lot they can do . The Nats need to grow some balls... and make some bold choices... take on the oligopoply in building materials supply industry, the anti-growth  lefties in Auckland City Council, the rorting by the councils on subdividing land, to name just a few 

Boatman - blaming the

Boatman - blaming the messengers, slanging off, and failing to ascertain the truth of matters, don't raise the level of the debate.
 
Those who warn of the ramifications of, and limits to, growth, do so for good reason. Time you did some homework.
 
Oh - and Councils don't 'rort', that;s spin/hype/bull. Every Council dollar is owned by the ratepayers; the economies of scale make Council (or a single/few entity) more efficient. They now face over $100 oil, where just a short time ago they were assured it would never be more than $30, ever. All they do, all they use, is based on that oil; there went Hugheys Multiple right there......

PDK , I am not blaming the

PDK , I am not blaming the messengers, Just read this comparison with my Nephews new house in QLD vs north of Auckland and tell me the Govt cannot facilitate to process of development .
I have first hand experieince of both the overpriced cost of building materials in NZ and the horrendous costs of subdividing a section .
I got an Albany based Land Surveyor to give me a fee proposal for the subdivision of my 6500 m2 land in Chester Ave Greenhithe , and I was blown away. The Auckland council fees are in the order of $60,000 not including a staggering $7000 for a water meter, plus another $6000 for wastewater reticulation  The water meter costs $200 to buy in Australia and the piping about $300 , how its ends up at $ 7000 has me lost, let alone $60k  
On the score of building materials , I helped a young family member build a small "Queenslander " 127 m2 two bedrrom steel framed  Kit home (Villa 2 by Kit Homes Australia )   outside Brisbane , all up for $57,900 , PLUS $33 000 FOR THE LAND ( flat and not waterlogged ) 
Thats right a 127m2 HOME AND LAND FOR UNDER $100K . His local council rates are $98. per month
SAME HOUSE OUTSIDE  AUCKLAND (WHANGAPAROA AREA ) :
LAND $290K
SIGNATURE HOME $ 187K
TOTAL $ 477,000.00  plus Auckland  council rates 245% more than the Brisbane property
GO FIGURE !
 

...I'm with you boatman, and

...I'm with you boatman, and with you snippy. English is a b.s. artist.
Remmber his claiming he didn't have a house in Wellignton so he could claim expenses grants...his house was owned by a trust with his wife as beneficiary.  

  Cheap fringe sprawl houses

 
Cheap fringe sprawl houses are actually expensive to live in:
 
" ...  The inclusion of transportation costs affects  the relative affordability of many metro areas.  For example, housing costsin the Houston region are comparatively affordable as a share of income, ranking eighth out of the 25 regions examined.  When transportation costs are included, however, Houston drops into 17th place, as one of the less affordable regions for the combined costs of housing and transportation.  In contrast, metro areas such as San Francisco, Boston, and New York are some of the least affordable regions for local moderate-income households when just housing is considered, but are among the most affordable when housing and transportation costs are considered together."
 
http://www.cnt.org/repository/LosingGround.FINAL.pdf
 
Freeing up fringe land doesn't neccessarily mean cheap housing. Transportation cost are not going to go down.

Lots of areas however do not

Lots of areas however do not have rail links...and many ppl prefer to use a car....at least for now.  However I find it interesting just how hard it is now to park near my station these days with commuters filling the roads. Also the numbers of ppl on ten trip tickets as opposed to monthly....just why is there such a trend.
regards

Bob - cities are polycentric.

Bob - cities are polycentric. Think of them in terms of a collection of villages.
 
Christchurch is still funcyioning remarkable well without a Central Business District at all - and dear old Bruiser Brownlee is just finishing off what the earthquakes failed to desroy - with his seriously dopey Central Blueprint.
 
The guys 'in the know" Im communicating with simply just cant believe how the costs of the forced land aqquisitions are "blowing out". It all involves a lot ,ore than just "land" of course. The media guys really do need to talk to people in the know on these issues. The whole thing is a complete circus - which will be "trashed" once ratepayers learn the real numbers.
 
That is - when politicans (both central and local) start treating people with respect by telling them the truth.
 
Hugh Pavletich

Indeed transportation costs

Indeed transportation costs will be going up.....if only relative to earnings.....
Surburbia is dead....
 

  In life, it is much easier

 
In life, it is much easier to live with our own imperfections than it is to live with someone else’s. The faults which we never noting in ourselves test all our patience, tolerance and understanding when we see them in others.
 
In our housing policies we seem to have forgotten this basic fact. As it becomes more difficult for people to participate in making their own homes, the level of satisfaction which people get from those homes will decline.
 
To give people access to money, while at the same time denying them access to the opportunity of solving their own problems, is to turn them into slaves of and economic system. We need to ask who our houses are really for.
 
Problems also double in size every time they are passed on to someone else. The costs may be hidden but someone somewhere, eventually has to meet them. If, for example, you can solve a problem yourself, it will always cost considerably more to get your local council to solve it for you. Eventually someone, through rates, will pay very much more than the job should have cost. Stop and think before you next reach for that handy telephone.
 
Problems also become more difficult to solve when they are passed on to someone else. There is a tendency to misunderstand the problem, or even to forget where it all began, as administration experts take over. There is a tendency to use grandiose solution when simple ones would have been adequate, and probably better.
 
New Zealand has had a wonderful tradition of being a nation where people did things for themselves and solved their own problems.
 
If they did not know the answers, they had the courage and the initiative to go and find out. If they did not have the skills, they went out and acquired them. Looking now at the endless miles of “executive subdivisions”, you wonder where all the New Zealanders have gone.
 
We are degrading ourselves by becoming a nation which expects something for nothing. Our housing problem really begins and ends at home.
 
The Human House, Tony Watkins-Architect.

Why should there be

Why should there be development at cost? why cannot there be a profit? 
Just where is the profit being made?  
regards

Who are the ugly people in

Who are the ugly people in these videos, and are they still dressed by their mothers who are now blind?

Sigh.  Dis 'ere thread has

Sigh.  Dis 'ere thread has already attracted some doozies.
 
The Torygraph link's now rotted (can I make a Leaky Site claim fer That?) but the horrid mixture of drivers in the affordability issue is well known, and the 'solutions' are gonna involve Pain fer some.
Taking the drivers one by one from the original article: -
1."license housebuilding, so that no one could build a new house without a licence, or even rebuild an old house or a redundant barn." 
 
Well, we have the Licensed Building Practitioner scheme now, and it's all interlocked with consents, mortgages (try telling yer Bank you are a self-build!) and insurance (ditto).  Pure credentialism, and all in the name (to quote the brochure) of 'to provide a building and housing market that's both skilled and productive". 
 
What it is actually doing is setting up another Guild, to shut out self-builds and other attempts to exercise that basic human right - to construct your own shelter.  And one only has to mingle just a little with the actual folk doing the building - the hammer hands, concrete placers, plasterers, painters, scaffolders and roofies - to realise that adjectives like 'Skilled', 'Productive' etc are rarely needed. 
 
The short-term way around it is to factory-produce homes - the 'flat-pack-home' - and to type-approve them (thus dodging issue #3, below) and assure Quality Control.  Then bolt them together on site in a matter of days (with trained factory staff, not the usual bunch of drug-addled hammer hands employed by LBP's).
The longer-term way is to tear down these Guild walls and let folks build themselves if they have a mind to.  After all, a goodly percentage of Christchurch was built this way (remember Norm Kirk's vaunted house???) and chimneys aside, no-one died from dodgy self-builds or DIY structural failures in the whole city.
 
2." encourage developers to maintain large land banks in order to benefit from rising prices". 
 
Well the Productivity Commish nailed this one too:  the Rural-Urban land multiple is around 10 in Auckland.  But to unwind this means a nominal, massive loss in value for said land-bankers.  And a loss in collateral for their backing financial institutions.  And a reduction in the lending they can therefore do, and.... a whole financial domino effect  Like I said, lotta Pain in this one!
 
3." leak out new permissions only after long periods of delay.". 
Well, and ol' Rees-Mogg should have added, 'and lots of fees, levies, contributions, and did I mention Fees' on top.
Councils now have power over so much of the regulatory aspects of housing and building (a partial list: - land prices (via zoning) - land developmnent (via consents and taxes) - housing design (via consents, design rules) - housing build (via inspections, requirements) - continuing use of house plus land (via Plans, consents and permitted uses) that their ordinary operations, in puddling through all of the above, have a major economic impact on the lives, businesses and prospects of anyone enmeshed in their gears.
And Councils have no idea of, let alone penalty for causing monetary loss because of, the time value of money.  
They have no idea of the principles of monopoly (who else runs the sewers, roads, stormwater?). 
They take no precautions against the ancient abuses arising from this - they employ staff on salaries, who are completely disconnected from quantum or quality of output, and who thus experience precisely zip/zilch/nada of the consequences which would follow in the business world (termination, bankruptcy, or at the least, serious loss). 
They are able to compulsorily demand fees for services (or no consent, buddy), rates (or we'll sell the place from under you), and levies (or no subdivision, you 'orrible greedy developer).
Thus they wander serenely about the landscape, causing economic havoc in their wake, and congratulating themselves on a job well done.
Easy to say all this (especially when yer copy it from an old blog post), damnably hard to Fix.  One tends to a Kalashnikov solution, but where ter get all the magazines ye'd need?
 
4. "combine this with an unlimited flow of mortgage credit and relatively low rates of interest."
'nuff said - there's the petrol on the fire.
 
So, with this leetle bit of background in fronta yis,
 
Common Taters, Discuss!
 

So, without a massive

So, without a massive paradigm shift, we're f#*ked? 
 
Time to rethink all economic theory or just throw it out the window?
 
"The signigicant problems we face today cannot be solved by the same thinking that created them" - Albert Einstein

Add a non-competitive

Add a non-competitive building/building supplies industry plus this nice little snippet from Eric Crampton here , a tighter building code than, say, Aus, 'cos we have earthquakes and bingo it's the death of a thousand cuts. I suspect Bill is only finally admitting reality because he needs to soften us up for the fact there is no silver bullet and tinkering won't cut it.
 
I am yet to hear the definitive answer on housing affordability from someone without a vested interest (sorry, Hugh, giving your publication a Latin name doesn't make it authoritative) and keenly await one.

I think housing is 40 to 50%

I think housing is 40 to 50% over its fair value based on the cost to wage ratio of 3 to 1.
We simply spend too much on housing.
Were I differ from hugh is he thinks like a libertarian...hence its the Govn/council/regs fault and not stupid speculation fueled by preditory banks lending cheap money.
I do think sections are over-priced but thats based on what ppl think a section is worth when they see the costs of homes on a similarsection....its simply greed and they can get it because of the shortage.
Labour is over-priced because there are too few builders....
Materials are clearly over-priced, no competition.
tools are clearly over-priced....effective monopoly by the importers.
finishing goods are of poor choice and over-priced....
All the above I suspect adds 100% to the actual build cost....
regards
 
 

the Nats have been in power

the Nats have been in power for what 5 years and this is the best they can summon?
the urgency required has not been forthcoming. Nz will pay the price

....yes it's unbelievable

....yes it's unbelievable Matt. We're heading for 3rd world status here I think. I think we have to vote these clowns out. Too busy with selling assets for their freinds to benefit with big fees, instead of fixing the real problems of the economy.

The problem is the economy as

The problem is the economy as we know it isnt fixable,
http://aspousa.org/2012/08/commentary-peak-oil-declining-eroi-and-the-ne...
I dont for a moment think the Pollies are so stupid they are not aware....or yes if they are not aware by avoiding looking, then they are not fit to govern.
At some stage the **** will hit the fan, so I suspect the Pollies are trying to claim ignorance so they are thoughht of as a blameless......
regrads

Matt in Auck - you are spot

Matt in Auck - you are spot on. This is their "last chance" to sort the problem properly - with a focus on land sipply and proper infrastructure financing (along the lines of the Texas MUDs).
 
If they fail to do this - this country is "toast" - as it simply cannot afford to allow the current bubble circus to ramp the Auckland Multiple north of 9 , Christchurch 8 and the rest following on the "bubble ride". Pumping say a further $200 bubble value in to ot incorporating a further $50 billion of bubble mortgage debt (about 25% of it is "mortgage devt fueled" in the Anglo world). Doing a destructive Greece / Spain / Ireland to the country.... because of sheer political negligence and stupidity.
 
Far better to build out of it rather than bust out of it.
 
They know full well too that affordable new fringe stock is going in to the affordable US markets for about $US600 per square metre ALL UP - here north of a stratospgeric $NZ2,500 plus ALL UP per square metre.
 
The industry productivity / pricing is currently a shambles.
 
Already 2 /3 rds of Australian major metros are more affordable than Christchurch and Auckland - with the gap widening - refer Schedule 2 of this years Dmographia Survey www.demographia.com - bearing in mind it is based on 2011 3rd qtr data. Make the necessary adjustments guys. The "gap" has worsened since).
 
We are back on the road to reality guys.
 
Hugh Pavletich

...that's pretty much it Hugh

...that's pretty much it Hugh in terms of the road ahead. Blow up a few hundred billion more in bubble debt, and it is going to end in tears for all NZ'ders. We will, as you say, be toast...for a long time, if not permanently 

rp - My BIGGEST concern is

rp - My BIGGEST concern is whether or not we have politicians in there capable of articulating the issues effectively - across the political spectrum.
 
After all - it is a basic human rights issue - and partisan politics has no part to play in it. And God help them if they do - because I will (to quote what Michael Joseph Savage said on his deathbed about John A Lee) "make their lives a living hell".
 
Contrary to what Bill English has said, there is nothing at all complex about these issues (bureaucrats are "gifted" at making the simple - complex - ask the guys  in  "confusers are losers"Treasury "how" for example). The numbers speal for themselves - and they are simple. Super simple.. Translating political speak in to plain English for "complex" means "requiring effort and thinking from a politician".
 
So we sure need plain English from Bill English. Not painful English !
 
And as for Phil Heatley......is he at some stage intending to be Minister for Housing..... or just going to stay in cruise mode (basking in the glory of the transient job - for what it's worth) as Minister for State Housing - parroting the tedious scripts Housing NZ CE Lesley McTurk prepares for him?
 
It should be him - bot me - articulating these issues.
 
I was described by a senior politician recently I understand as "rude but right". Again.... translation from political speak is required for the word "rude". To paraphrase President Harry Trumans famous quate "They think Im giving them hell - but Im only giving them the facts - and they think its hell".
 
Truman had originally said "They think Im giving them hell - but Im only telling them the truth - and they think its hell". As the chosen people and the shining light on the hill and al that jazz I will leave the Americans to use the word "truth". This humble Kiwi will settle for the word "facts" as I am devoid of the required piety !
 
Interestingly, the "parting shot" I had from the great Urban Planning Professor Solly Angel (author of the recently released important work "Planet of Cities" and contributor for an earlier Demographia Housing Survey) when I was leaving after meeting with him in Manhattan was "Always talk truth to power Hugh". Some of the best advice I ever had. I have enormous admiration for Solly and hope we can get him out here to New Zealand at some stage in the near future.
 
Hugh Pavletich
 

keep up the great work Hugh.

keep up the great work Hugh. This issue so toxic for the country, especially our young people, it has got to be sorted. If the politiicians lack the will, they need public prodding as you've been doing. Those of us who understand the issue appreciate your good work

I don't think New Zealand

I don't think New Zealand house prices in the cities will rise much more to get too concerned about in 2013. NZ will probably get down graded next year and our borrowing cost may rise as a result of this in the second half of 2013 due to being downgraded.Once they have built 500,000 homes in Christchurch then rents and house prices could well head south.

Please a leetle

Please a leetle reality.
 
160,000 rateable properties in Christchurch
10% stuffed, say 16-20,000
40% a bit of Gib work needed
50% not worth worrying about the small amount of paint wrinkling or chips on the SUV.
 
Ye'd be hard-pressed to find 500,000 buildings in the entire South Island.
Sigh.

Waymad - my understanding is

Waymad - my understanding is that there are something like 15 - 17,000 houses in ChCh to be demoed with a further 15,000 with damage of in excess of $100,000 . Total original residential stock in the order of 150,000, I note a statement from Labour recently that they will be distributing 135,000 Survey Questionaires to Christchurch residents.
 
I got the above numbers indirectly. they werre apparently generated by Beacon Pathways research. Media should communicate directly with these people for clarification / confirmaton of the numbers.
 
Hugh Pavletich

2006

2006 Census
 
http://stats.govt.nz/Census/2006CensusHomePage/QuickStats/quickstats-abo...
 
134,721 occuppied dwelling in CCC territory.
 
Maybe 4,000 built up to 2010.  7,000 red zoned.  About a further 15,000 uninhabitable or to be demolished.  Puts the number of dwellings left at about 117,000 in CCC.  Probably a further 14,000 left in Waimakariri and 12,000 in Selwyn - total 26k say 18k in greater ChCh. 
 
Total in greater ChCh then 117k+18k=135k so Labour are about right.

Bank borrowing is at the

Bank borrowing is at the heart of the house affordability problem; they basically run the property market. one borrows as much as one can to compete and out do other bids to buy the dream home.
Lets hope the government and council act soon to make housing in Auckland attractive and affordable to younger generations to stay and strive.

2 tooth - you are spot

2 tooth - you are spot on.
 
If English and this Government fail again this time - as they did following the 2008 election - young people would be well advised to pack their bags for Australia where 2 / 3rds of the major metros are more affordable than Christchurch and Auckland (refer Scedule 2 Demographia Survey).
 
Then the politicans can focus on turning New Zealand in to a Rest Home.
 
Hugh Pavletich

Lets cut to the chase , if

Lets cut to the chase , if the National Goverment cannot facilitate the development of the Country , then we need to remove them at the next election and replace them with a Government that can .
 

... and the alternative will

... and the alternative will make things better , a government to facilitate development of the country : Labour - Greens & NZ Fiirst ?
 
Ah ha ha de haaaaaaaaaaaaaaaa !...... scuppered ..... you're sunk , Boatman    ... glug glug gurgle glug ....

Okay you have a point , but

Okay you have a point , but we do need a Government that gets on with it .
National are frankly a disappointment , but a Labour- Greens- First coalition would be a disaster

Okay you have a point , but

Okay you have a point , but we do need a Government that gets on with it .
National are frankly a disappointment , but a Labour- Greens- First coalition would be a disaster

have a listen to S Joyce in

have a listen to S Joyce in the gen debate today for a nice little summing up of what a GreenLabour nilist govt will be like - a real snorter

Boatman - Wee problem with

Boatman - Wee problem with the replacement Government option.
 
The current Labour performace would suggest that they should seriously consider merging with the Foundation for the Blind.
 
Due to a lack of effective leadership, Labour is still hopelessly internally conflicted. The old guard from the Clark / Cullen era should have been parked up in Rest Homes well before now by the so called "aspirational" David Shearer.
 
Kate below is clearly experiencing a little amnesia - because it was the 02 / 07 unnecessary inflating housing bubble that led to the explosion in bubble Government revenues / expenditure. So in essense, the current National Coalition Government is being required to sort out the former Labours Coalition mess. Labour was absolutely hopelesss through that era - and safly still is.
 
Hugh Pavletich

My reading of NZ history is

My reading of NZ history is that the only reformist governments in NZ have been Labour ones.
 
And I just don't think ANY colour of Government - be it multicoloured or a clean sweep by one colour - could be ANY worse than this present one.
 
A picture tells a thousand words;
 
http://www.interest.co.nz/Charts/Government/government-debt
 
 
 
 

There is a saying I quite

There is a saying I quite like, "never fight a battle unless you have to and never fight it unless you can win it"
Fraid I cant agree with you....the NZ economy is actually not bad....unemployment is half the USA.....housing is still about even unlike the USA say with is 30~40% down....with lots of homes under water...
regards

steven, NZ's economy is

steven, NZ's economy is better mainly because business/private sector has responded more responsibly to the GFC than it has overseas.  Unlike the US - we do not have small business/corporates holding onto huge cash reserves. 
 
Debt reduction is happening in NZ (see current account tracking) - but not in NZ government and where this government is cutting costs it is in all the wrong places.  Take police, for example - their contribution to the recent alcohol reform bill was to tell government that alcohol is a mitigating factor in 50% of all their work.  Rather than deal to alcohol consumption - this government is dealing to the Police budget.  Crazy stupid is really all one can say about this government. 
 
 

and the alternative is? a

and the alternative is? a failure who doesnt even get up to HC's standard?
oh yey....
:/
Lets be succinct, at least with National we are not deep in the spend our way out on stupid ideas and project scenario doggy doo doo..."oh cr*p that didnt work, why is our borrowing going past 7% like a ICBM".....circa 2015....
regards

Lets be succinct, at least

Lets be succinct, at least with National we are not deep in the spend our way out on stupid ideas
 
steven, so you are saying the the Roads of National Significance program isn't a stupid idea? Because that's where all the new money (i.e. their big idea for a stimulus program) is going.
 
 
 
 
 

Massey Prof Spoonley says it

Massey Prof Spoonley says it below (Radionz 23rd Oct 0932am)
http://www.radionz.co.nz/national/programmes/ninetonoon/audio/2536281/what-will-nz's-demographics-look-like-in-the-next-50-years
Immigration is the major problem in Auckland.
It is no coincidence that most of the new arrivals do not go beyond Auckland and if they do to meet their obligations, they go to Auckland as soon as they can.
Also overseas investors should not be allowed to own residential property in Auckland but if that is impossible then at least if they are allowed, it should be for their personal exclusive occupancy and they should not be able to rent it out.
Certainly no non- citizen ( that includes those with residency only) should be allowed any property other than for exclusive occupancy
 

IMF saying European banks

IMF saying European banks will need to sell $4.5 trillion in assets through 2013
"The International Monetary Fund said European banks may need to sell as much as $4.5 trillion in assets through 2013 if policy makers fall short of pledges to stem the fiscal crisis, up 18 percent from its April estimate."
I see, firesales anyone?
http://www.businessweek.com/news/2012-10-09/imf-says-european-banks-may-...
uh huh....
regards
 

Oct. 9 (Bloomberg) -- Wells

Oct. 9 (Bloomberg) -- Wells Fargo & Co. was sued by the U.S. government over claims the bank committed fraud by making reckless mortgage loans, according to a complaint filed in Manhattan federal court.
http://www.businessweek.com/videos/2012-10-09/wells-fargo-sued-over-alle...
regards

US housing deleveraging or

US housing deleveraging or defaulting?
"It's no secret there's a huge shadow inventory overhanging US housing, and now it comes out that those great new home numbers are not what everybody would like to think they are."
8><----------
"In other words, instead of actual responsible behavior of paying down debt, the primary if not only reason there has been any "deleveraging" at all at the US household level, is because of excess debt which became insurmountable, not because it was being paid down, the result of which is that more and more Americans are simply handing their keys in to the bank and walking away, and also explains why the US banking system is now practicing Foreclosure Stuffing, as defined first here, as the banks know too well, if all the housing inventory which is currently in the default pipeline were unleashed, it would rip off any floor below the US housing "recovery" which is not a recovery at all, but merely a subsidized bounce, as millions of units are held on the banks' books in hopes that what limited inventory there is gets bid up so high the second housing bubble can be inflated before the first one has even fully burst."
http://theautomaticearth.com/Finance/us-hyperinflation-is-a-myth.html

Interest only loans clamp

Interest only loans clamp down in UK, tough requirements on first home buyers and hard line on those aged 50 plus looking for a mortgage:
http://www.telegraph.co.uk/finance/personalfinance/borrowing/mortgages/9...
Mark Harris, of mortgage broker SPF private clients, told the Daily Mail the new rules would pose further difficulties for those struggling to get on to the property ladder – with many already delaying the move until the age of 35 because of problems getting finance.
 

Meanwhile in NZ more mortgage

Meanwhile in NZ more mortgage approvals being granted than ever before, mainly interest only basis and predominantly to people 50 plus purchasing investment properties. Those with equity get richer and supply problems particularly in Auckland will see their wealth escalate further.

The debates around housing

The debates around housing supply in Auckland seem to be characterised by claims that it is the fault of one sector or the other, and short on analysis of information on how much supply there actually is.  There is in fact zoning capacity for far more than 18,000 dwellings in Auckland.  That is the Council's estimate of 'unconstrained greenfield land' (i.e. zoned land with infrastructure) on the edge of the main urban area.  The total zoning capacity is something closer to 190,000 dwellings according to Council's calculations.  Most of this is in the existing urban area.  And before people leap to the conclusion that people dont want to live in 'high density' bear in mind that over the last decade or more, 80-90% of housing in Auckland has actually been 'intensification' (apartments, terrraced houses, 'back-lot subdivisions' etc). And over recent years it is inner city houses that have seen the dramatic increase in value - peripheral areas have seen relatively flat prices. This is partly a reflection of supply since the ARC's growth strategy, but also reflects demographic and societal changes (like cities all over the western world, people are less and less drawn toward dormitary suburbs that they percieve as 'lifeless' and require long and expensive commutes to work).
So what does this mean in terms of addressing housing supply constraints? There is probably a need to increase the supply of greenfield land, so that we get that sector moving.  But it in the drive to get cheaper housing, we need to make sure we get quality development as otherwise there may not be much demand for development in these areas.  But perhaps even more importantly we actually need to get the zoning capacity in the places people want to live in the existing urban area.  Too much of the '190,000 dwellings' of zoning capacity is in places with next to no market demand.  This will take some serious political leadership as it means taking on the age old resistance to change in affluent suburbs - NIMBYism as it is often coined.  

The debates around housing

The debates around housing supply in Auckland seem to be characterised by claims that it is the fault of one sector or the other, and short on analysis of information on how much supply there actually is.  There is in fact zoning capacity for far more than 18,000 dwellings in Auckland.  That is the Council's estimate of 'unconstrained greenfield land' (i.e. zoned land with infrastructure) on the edge of the main urban area.  The total zoning capacity is something closer to 190,000 dwellings according to Council's calculations.  Most of this is in the existing urban area.  And before people leap to the conclusion that people dont want to live in 'high density' bear in mind that over the last decade or more, 80-90% of housing in Auckland has actually been 'intensification' (apartments, terrraced houses, 'back-lot subdivisions' etc). And over recent years it is inner city houses that have seen the dramatic increase in value - peripheral areas have seen relatively flat prices. This is partly a reflection of supply since the ARC's growth strategy, but also reflects demographic and societal changes (like cities all over the western world, people are less and less drawn toward dormitary suburbs that they percieve as 'lifeless' and require long and expensive commutes to work).
So what does this mean in terms of addressing housing supply constraints? There is probably a need to increase the supply of greenfield land, so that we get that sector moving.  But it in the drive to get cheaper housing, we need to make sure we get quality development as otherwise there may not be much demand for development in these areas.  But perhaps even more importantly we actually need to get the zoning capacity in the places people want to live in the existing urban area.  Too much of the '190,000 dwellings' of zoning capacity is in places with next to no market demand.  This will take some serious political leadership as it means taking on the age old resistance to change in affluent suburbs - NIMBYism as it is often coined.  

Immigration and hot money has

Immigration and hot money has to be contributing to the Auckland demand.
If any further evidence is need, just look at #7 in today's 10 at 10 in relation to Cyprus
The number of Russians visiting Cyprus has tripled in three years to more than 400,000 and many do not intend to go back. The official estimate of Russian residents here is about 50,000 but double that seems nearer the mark. Aside from the appeal of an agreeable climate and a low tax rate, the Russians' penchant for cash transactions prompts widespread suspicion that the island is becoming a giant laundromat for red-hot rubles. Cypriot authorities deny this.
The Russians' location of choice is Limassol, a 45-minute drive from Paphos, where there is a Russian-language newspaper, a Russian-language radio station, two Russian-language schools and enough prostitutes from former USSR states to keep the Red Army tied down, as it were, until Christmas. And the Chinese are keen too.
The Russians, quite correctly, view Cyprus as a convenient backdoor to the European Union – and they are not alone. The Chinese have also started arriving, encouraged by what they regard as an incredibly low bar to immigration. Forget all those tricky visa forms, for anyone prepared to spend €300,000 on a property in Cyprus there is the bonus of eligibility for permanent residency. Once this is achieved, the owner is entitled to move anywhere within the EU. For the price of a shoebox in Shanghai, Cyprus is offering a gold-card travel pass and much more besides.

Doesn't get any traction does

Doesn't get any traction does it Basel? For very good reason which I don't need to spell out anymore.
 
Not so very long ago New Zealanders and Australians could "freely" travel back and forth between the two countries without restrictions, without passports, without visas. BUT, when Honkers reverted to Chinese control those Honkers got out en-masse to new zealand with suitcases full of cash, because, it was harder for them to get into Australia. It soon became evident immigration and currency controls into new zealand were less tricky, and once citizenship was obtained, off to australia. BUT australia woke up to that and imposed full immigration controls and passports and visas, on EVERYONE, where none had been required before. YEP, life has changed. The few have changed it for the many. And are still doing so. New Zealand is still being used as a back-door into Australia. With a little bit of vivid imagination it shouldn't be to hard to come up with a clue as to why a certain corpulent german businessman came to nz rather than australia.

Well icono, I would not have

Well icono, I would not have known about one large German if he had not been even larger than life and on TV courtesy of incompetent state actions.
However malls and streets with majority of the faces being new arrivals is something that becomes much more obvious. In particular the sheer numbers of older unemployables having made no contribution to our taxes are about to compete for our limited hospital beds and rest homes and  is deplorable.
What is more deplorable is inaction by the politicians both national and local.

To Hugh, thanks for all your

To Hugh, thanks for all your efforts to solve the housing affordability problem. I broadly agree with you, having recently returned to Christchurch I think it is stupid that residential land is so expensive when you have farm land only 10 kms or less in some areas from Cathedral square.
Obviously the solution is to rezone that land to residential with some sort of rules, incentives etc, that houses are quickly built on it.
Where I differ from you is that I do not see the libertarian Houston model as the solution. I would prefer stronger local government along the lines of Northern Europe where the local municipalities have a greater tax base, say income tax as well as rates. And then being able to fund transport and other housing related infrastructure that i think most kiwis want.
I think local government is unfairly maligned in New Zealand about the costs of consents.They have no choice about the matter. The Resource Management Act dictates that local governments must charge the full cost for all new developments. This is Rogernomics neoliberal thinking that public goods, like roads, sewage, public transport etc, must be charged to the end user, in this case property developers who pass it on to new home owners.
I believe local government want to provide these public services because that would benefit the wider community. Local communities could retain and attract young people, many of whom are highly skilled after receiving 20 plus years of public and private investment.
But not only is local government legally stopped from doing this but they are also fiscally prevented. Rates is a very limited revenue source. Most local or state governments in other parts of the world have alternative and bigger sources of revenue. You can see this argument running in Auckland where the voters for the new super city voted for the candidate who promised higher taxes and better transport infrastructure and central government will not allow the super city a regional petrol tax.
Ultimately the problem comes down to central government politics. They could reform the system, they could give local governments freedom like they have in the US and Europe and we the voters could decide if we want a Houston or a Copenhagen, Helsinki or what ever.

To Hugh, thanks for all your

To Hugh, thanks for all your efforts to solve the housing affordability problem. I broadly agree with you, having recently returned to Christchurch I think it is stupid that residential land is so expensive when you have farm land only 10 kms or less in some areas from Cathedral square.
Obviously the solution is to rezone that land to residential with some sort of rules, incentives etc, that houses are quickly built on it.
Where I differ from you is that I do not see the libertarian Houston model as the solution. I would prefer stronger local government along the lines of Northern Europe where the local municipalities have a greater tax base, say income tax as well as rates. And then being able to fund transport and other housing related infrastructure that i think most kiwis want.
I think local government is unfairly maligned in New Zealand about the costs of consents.They have no choice about the matter. The Resource Management Act dictates that local governments must charge the full cost for all new developments. This is Rogernomics neoliberal thinking that public goods, like roads, sewage, public transport etc, must be charged to the end user, in this case property developers who pass it on to new home owners.
I believe local government want to provide these public services because that would benefit the wider community. Local communities could retain and attract young people, many of whom are highly skilled after receiving 20 plus years of public and private investment.
But not only is local government legally stopped from doing this but they are also fiscally prevented. Rates is a very limited revenue source. Most local or state governments in other parts of the world have alternative and bigger sources of revenue. You can see this argument running in Auckland where the voters for the new super city voted for the candidate who promised higher taxes and better transport infrastructure and central government will not allow the super city a regional petrol tax.
Ultimately the problem comes down to central government politics. They could reform the system, they could give local governments freedom like they have in the US and Europe and we the voters could decide if we want a Houston or a Copenhagen, Helsinki or what ever.