Housing shortfall estimates, the consents-to-builds conversion rate and plans for state-led house building in Auckland received a solid airing in Parliamentary Question Time on Tuesday.
Labour Party housing spokesman Phil Twyford kicked things off, asking Minister for Building and Housing Nick Smith how much Auckland’s housing shortage had worsened since the government’s 2013 housing accord showing a 20,000-30,000 gap.
Smith responded that annual housing construction in Auckland had risen from 4,000 in the five years to 2013, to about 13,000 now. “No one claimed that this more-than-trebling would occur overnight – we have achieved the accord targets and the longest and strongest growth in residential construction in Auckland’s history,” he said.
He then repeated Tuesday’s comments made by himself and Prime Minister Bill English that the National-led government was sceptical about official figures on any New Zealand housing shortage.
“Officials have advised me that depending on what assumptions are made, they may vary by as much as 50,000 homes,” Smith said. For instance, assuming a difference of 2.8 or 2.9 people per house makes a difference of 20,000 in the number of homes required, he claimed.
Twyford raised one of the PM’s favourite sound-bites during his eight-year tenure as Finance Minister: that this government would rely on “evidence-based policy” in its decision making. Was it not strange that Smith was not seeking better estimates of the size of the shortage?
“The best indicator of the deviations between supply and demand is prices,” Smith replied. Supply and demand are in balance in Christchurch, and progress is being made in Auckland, he said.
If that is the case, Twyford asked, how can Auckland be ranked the fourth most unaffordable city in the world in terms of price-to-income ratios?
Smith could not help a political dig: “The difference is that house prices doubled under the previous Labour government and they did nothing.” The current government’s reform programme is seeing the rate of house building grow from 13,000 per year to over 30,000 per year, he said, adding residential investment in Auckland grew by 27% last year.
Winston weighs in
New Zealand First leader Winston Peters could not be left out. Could Smith say why, in the five years to 31 October 2016, 13,676 fewer dwellings were built in Auckland than were consented, he asked.
“The Member’s figures are garbage,” was the reply. “If you compare the number of consents that are issued between the last two census, and the census data on the number of new houses that are completed, they were within one percent,” Smith said.
Both tabled documents to support their arguments. Neither seemed to. Peters’ document did not refer to the number cited. The key quote from Smith’s was that the numbers “show that overall, historically, new dwelling consents have predicted total dwelling numbers (as counted at Census time – occupied and unoccupied) to within 10% nationally and 5% in Auckland.”
The relationship between consents and dwellings nationally, with a lag of six months was 89% between 2006 and 2013, Smith’s MBIE figures showed. This compared to 92% between 2001 and 2006. (87% and 93%, respectively with a 12-month lag).
Meanwhile in Auckland, the conversion rate was 100% between 2006-2013 versus 94% in 2001-2006 (97% and 93%, respectively with a 12-month lag.)
Twyford stood again to ask Smith about the government’s intentions to increase the number of houses on state-owned land in Auckland from 27,000 to 69,000. With English’s comment Monday that the bulk would be sold to the market in the background, he put to Smith that there was no commitment from the government to ensure any of the new houses would be affordable.
Smith dodged Twyford’s point, inviting him to a tour of building projects in Hobsonville, Tamaki and Northcote. “Last year government agencies built more homes than in 25 years,” he put to the House.
Not to be denied extra comment on the numbers, Twyford issued a press release following Question Time:
Nick Smith has confirmed National has no plan to build 69,000 houses in Auckland, says Labour Housing spokesperson Phil Twyford.
In Question Time today, Nick Smith admitted that the 69,000 figure is only the theoretical number of houses that could be built to replace 27,000 existing state houses over the next 30-50 years. There is no plan to actually build these houses, let alone to ensure they are affordable for first homebuyers or kept as state houses.
“Bill English is buckling under the pressure. He’s got no answers on the housing crisis and is making up policy on the fly. Nick Smith has now admitted the government has no plans to build 69,000 houses.
“This isn’t leadership; it’s desperation from a Prime Minister who just wishes the housing crisis would go away but won’t do anything about it.
“At the same time, Nick Smith is trying to claim the housing shortage is ‘only’ 10,000-20,000 houses but he can’t back that number up in any way. The Government’s own documents say the shortage in Auckland is 30,000-35,000 and the nationwide shortage is 60,000.
“Bill English and Nick Smith are in cloud cuckoo-land when New Zealand urgently needs is practical solutions to the housing crisis.
“Labour will build 100,000 affordable homes for first homebuyers; we’ll stop the state house sell-off and build thousands more state houses; and we’ll lock out the foreign speculators who use our houses as gambling chips,” says Phil Twyford.