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Labour and National propose major building densification law change, expected to see up to 105,500 extra homes built in the next 5-8 years

Property
Labour and National propose major building densification law change, expected to see up to 105,500 extra homes built in the next 5-8 years

The Government, with the support of National, is proposing to urgently change the Resource Management Act (RMA) to enable more houses to be built in cities.

It plans to pass a bill to make councils in Auckland, Hamilton, Tauranga, Wellington and Christchurch implement intensification requirements under the National Policy Statement - Urban Development at least a year earlier than the current requirement.

Councils will need to have their intensification policies and rules in place by August 2023.

This process will also enable councils to rezone greenfield land as residential, opening more land for development sooner. 

Secondly, the Resource Management (Enabling Housing Supply and Other Matters) Amendment Bill requires the councils listed above to adopt Medium Density Residential Standards by August 2022.

These will enable landowners to build up to three homes of up to three storeys on most sites (up to 50% maximum coverage of the site) without the need for a resource consent. Previously, district plans would typically only allow for one home of up to two storeys.

The proposed change will result in fewer resource consents being required and a simpler process that avoids notification when a resource consent is needed.

Exemptions will be made in certain areas with heritage or cultural significance for example.

Councils in Whangarei, Rotorua, New Plymouth, Napier Hastings, Palmerston North, Nelson Tasman, Queenstown and Dunedin could be required by Order in Council to adopt the Medium Density Residential Standards if there is an acute need for housing in their town/city.

Minister for the Environment David Parker and Housing Minister Megan Woods said the proposed changes will enable more medium density housing and cut red tape that acts as a barrier to development.

They estimated 48,200 to 105,500 additional dwellings could be built over the next five to eight years, above what was expected from councils implementing the National Policy Statement's intensification policies.

Parker expected the changes to see slower increases in house prices, not house price declines. 

National's Housing spokesperson Nicola Willis said the changes "make it easier for new dwellings to be added to existing sections in New Zealand’s major urban areas, increasing competition for buildable land, and reducing the complexity, cost and delays currently caused by the resource consenting process".

“Today National and Labour are coming together to to say an emphatic ‘yes’ to housing in our backyards," Willis said. 

National leader Judith Collins said the proposed changes are similar to those made under the National-led Government in Christchurch following the 2010/11 earthquakes. 

Collins said she approached the Government in January, suggesting National works with it on the issue. Then in April, she presented it with a proposed piece of legislation. 

Parker said the bill would be introduced to Parliament shortly.

"Making these amendments, while we are undertaking reform of the resource management system, speaks to the urgency of fixing the housing crisis we inherited," he said. 

Local Government New Zealand spokesperson Jason Krupp told interest.co.nz local councils hadn’t been consulted on the changes.

The public will have the opportunity to provide feedback on the proposed changes as the bill goes through the regular parliamentary process. 

See this fact sheet for more. 

We welcome your comments below. If you are not already registered, please register to comment.

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.

198 Comments

You cannot build your way out of a credit bubble.

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Exactly.

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I think you're missing the point Brock, which is densification vs urban sprawl 

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But can we afford it Yvil?

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Can we afford not to YDB?  We have a shortage of housing, do you not want everyone to have a roof over their head?

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7

Depends on your idea of a roof and whether it's leaking or not..

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We do not have a shortage of housing.  There are not 10k families in NZ living in cardboard boxes

We do have a credit/debt bubble issue.

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6

Whilst I agree with the sentiment of the housing shortage being overplayed - as it is more people wanting to own houses which everyone seems to think is some sort of fundamental right. There are still significant numbers of families living in emergency housing or multiple families in one house, so in that sense there is a significant shortage of housing. 

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4

Tell that to the people living 3 to a bedroom

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I think you're missing the point Yvil, which is to just ram more "population growth" down our throats.

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And make any talk of a fulfilling commitments to climate change a joke.

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Fulfilling commitments to climate change IS a joke.

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Brock, this new law is about providing more dwellings which are needed for NZ, it's  NOT about whether population growth is desirable or not.  When we accept NZ needs more dwellings, there are broadly two choices, building outward of city centres, creating new suburbs which grab arable land, create more and longer traffic commutes to town which means more pollution or building within the existing city by allowing more dwellings per land.  This results in a denser city which is generally more vibrant and good for cafés, restaurants and most business. It is a good law folks!

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Absolutely. Great new change for NZ.

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No carparks means not good for residents.

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A car thieves paradise coming soon to your area.

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Yvil,

Of cousre, density is a good thing to do, provided that:

- It is done in the right places
- It lowers housing costs
- It doesn't lower our standard of living
- It produces family sized dwellings instead of shoeboxes.
- It doesn't have body corporate problems
- It has sufficient green space provided nearby
- It's purpose is not just to warehouse more "population growth"

However, as this is New Zealand, you can bet your bottom dollar that it will fail on every single item above.

You are not going to replicate an idyllic European town centre in this country through blanket zoning of infill housing.  You are just going to end up with overpriced far flung car dependent slums on the far edge of town.
 

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Also supporting infrastructure for higher density such as roading (so traffic doesn't get worse if that's possible), sewage, water power etc. The pipes need to be fat enough

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You are not going to replicate an idyllic European town centre in this country through blanket zoning of infill housing.  You are just going to end up with overpriced far flung car dependent slums on the far edge of town.

On the money yet again 

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Brook 

 - will apply around rapid transit corridors in main centres  -  these are absolutely the right places to density 

-  will enable generous family sized houses given buildings  can be 3 stories high - eg allows 3 x 225 square metre houses on a 600sq metre section.  Assuming a garage of 30 sq metres, means a 195 square metres house. 

-  should allow green space on site given only 50% section building coverage. 

- should help to lower house prices by encouraging more supply. But government’s  immigration policy reset needs to support this type of initiative. 

 

 

 

 

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You are both missing the point.

Interest rates have very little effect on demand if supply is allowed to equal it in developer real-time.  To achieve equal supply to demand you need fewer land-use restrictions over all (not just some) land because the price of all land is set at the fringe. If you make it more expensive to build on the fringe, it causes all houses to be relatively more expensive going in.

This slope from fringe to CBD is the same for any city in the world, the only difference being the fringe value starting point. High fringe, relatively higher going in, low fringe relatively less of an increase going in.

You need rules that allow build up and out at the same time. This then allows the higher density to be truly more affordable, allowing those that want that type of lifestyle to be able to afford more closer in. 

The present less affordable system forces these people to the fringe and beyond, to where it is relatively more affordable. And if they choose to stay closer in, due say for work, it normally is at the expense of what they want for house size amenity.

This Labour/National plan is not inclusive enough for the system to work.

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It’s not just land that is a constraint… Labour and more recently, materials are as well.

potentially this law will put a lot of doubt in place for development as the demand for x or y development plays out.

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The point should be growth vs sustainability. We can't keep growing forever (and growth is very much a choice in NZ, controlled by the immigration lever).

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But. They believe in Modern Monetary Theory. Print and Inflate and then Tax your way out of debt!

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You cannot build your way out of a credit bubble.

Very true. But you can always tell the sheeple 'look over there.'

 

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In an unprecedented bi-partisanship, the two major parties that did all they could to not do anything about the issue for the last 20 years agrees to.. not do anything about the issue until 2023, after which a rule will change that might have some effect after maybe about 5 years..? 

I agree with BL.  The things that needs to be done are:

- Lending standards

- Interest rates

- Equitable tax treatments compared to other investments

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yep. confirmed.

building houses = NZ's econ development model.

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Yes indeed Xingmo. Just like China except plenty of people actually want to come and live here.

Look for an announcement shortly whereby mass immigration is resumed to build, then fill up, the newly built rabbit hutches.

Meanwhile, we get stuck with higher rates and congestion.

The economic model is one of using the land of NZ, to build for population growth.

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Manna from Heaven for the Developers.

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For the small scale cowboys it is. Lots of crappy 3 dwelling slums coming to a place near you!!!

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All sub standard potentially leaky homes ?

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wow my land just increased in value overnight, every action has a reaction

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Yep, an obvious unintended consequence.

Almost any property that is at least 300-400 square meters in area will shoot up 10-20% in value overnight. The median will shoot upwards again.

I have been calling this for a while, no one seemed to have any interest in my comments. Wasn't offended in any way, but I thought the lack of interest was interesting.

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HouseMouse, the median won't go up, it will go down.  Yes the value of a piece of land is going up as a consequence of densification but said increased value of land will now be divided into 3 dwellings, therefore the price of each dwelling will reduce

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Narrator: The price of dwellings didn't reduce.

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It will take 2+ years to build those new dwellings though so in the meantime the median price would increase.

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Yes and possibly by quite a lot 

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Wrong.

Look what happened with the Unitary plan.

Land values will spike higher because of the new development rights. Extra density almost always leads to a spike in land values.

In a year or two it might help moderate increases in median value. 'Might' being the operative word.

Did you listen to me and buy a development property or two?

 

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HM, I can only repost what I said above since you clearly didn't understand it (or read it properly), yes the land value will go up but the value of each dwelling will go down as you will divide the higher land value by 3 dwellings.

"HouseMouse, the median won't go up, it will go down.  Yes the value of a piece of land is going up as a consequence of densification but said increased value of land will now be divided into 3 dwellings, therefore the price of each dwelling will reduce"

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No I *didn't* misunderstand it.

It takes time for houses to be planned, designed and delivered. In the mean time, there will be a developer buying frenzy where the price of existing properties will be bidded up.

This will push median values up - get it????

In a year or two, if lots of townhouses are actually built then yes the median might stabilise or even fall a bit. But that's a big if, given rising costs of finance and construction costs.

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I think Yvil is not talking about a specific time frame but rather a trend. The trend is each dwelling's price will go down as supply catching up with demand. But because of this law, the land value will go up. 

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Hallelujah!  Thank you for someone to understand this quite basic principle

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So just like we have seen since the Unitary plan came in 5 years ago with all it's high density rezoning Yvil. That's really helped - NOT!!!

Go on, ignore all the evidence.

You should stick to running motel slums.

Won't waste my time any longer. Have a good day.

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The problem Yvil is that the lower land cost per dwelling only applies to new dwellings. Existing dwellings will have the underlying land cost go up with no additional dwellings on them, leading to the land cost per dwelling going up.

Over the 20-30 year term land value per dwellings will come down, but NZ simply does not have the capacity to build houses fast enough to reduce that time frame by very much.

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But there will be a significant lag until the densification actually happens.  At least until after the council rules are updated (2023 deadline).  And then it'll take time to build/modify the new dwellings etc.

I think HouseMouse's point is that there will be a more immediate increase in the median because single dwellings that sit on decent sized chunks of land will increase in value. Seems like a reasonable theory to me.

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Yes of course there will be a lag but this doesn't change that this law will lead to lower land values per dwelling, which is my first point which HM is debating

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I did not argue that, you're putting words in my mouth now.

See ya.

 

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Per square metre land values will go up.

Land value per dwelling is a meaningless and nonsensical measure.

If you want to buy a house with a bit of grass in suburbia, prices are going up.

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With local authorities / city councils, one needs to think in terms of decades (not years). 

They’re notoriously slow, unresponsive and wasteful.

TTP

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Look what happened with the Unitary plan.

Land values will spike higher because of the new development rights.

Not true that the Unitary plan increased land values.

https://ourauckland.aucklandcouncil.govt.nz/news/2020/03/auckland-land-… 

See also https://www.aucklandcouncil.govt.nz/about-auckland-council/business-in-… .

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Most people are very ignorant when it comes to basic economics. 

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Including the ones who shouldn't be!

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Or the opposite. There’s been a premium on suburban sites large enough to subdivide within current rules… with the rules relaxed, that pool of properties is much less exclusive…

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There hasn't really been a premium. An awful ot of sites have been redevelopable under the Unitary Plan.

But it's a valid point, maybe in a year or two it might limit land value increases, but in the near term I think it's going to take prices further in to the stratosphere.

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It will be interesting to see how it goes. I live in a very average suburb that has seen property prices go even more insane than every where else, as there are lots of pancake flat developable sites, and there is only a small corner that is single housing. )I live in that bi where it’s quiet!) 

I do wonder if developers might start to look further afield for more value.  I can think of a couple of suburbs which have similar types of housing and closer to rail, but were predominantly zoned suburban or single. Surely they’d be more attractive as lower entry point? 

Hard to say. 

 

 

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It will be fascinating to see how this plays out - on the one hand land values will adjust to whatever developers can pay and still make money (potentially upwards pressure because larger or multiple occupancy developments will be worth more), on the other hand land owners could end up competing for buyers, which would have a downwards pressure. I am with you, I think the net impact will be land value increases - at least for the first few years.

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Hmm really? We have just under 500sqm which seems the perfect size for our 120sqm house to fit on.
 

Jamming 2/3 onto here would feel like a sardine can. 

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The fact that National has joined Labour in this initiative suggests that the developers lobby is happy for such increases to happen by themselves or to be created. It could also mean more construction in a hurry affecting quality of the houses and their long term durability and fit for purpose. Future is shaking.

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Do we know if they're going to do anything to increase capacity in the planning process?

Their new tax loopholes on 'new builds' have created massive tax incentives (likely to be north of six figures over the lifetime ownership period) to apply for Code Compliance on existing dwellings and convert these to 'new dwellings'. 

For example, I buy a property which is two dwellings on one property title, subdivide and create two new property titles with one dwelling each. Nothing has changed to increase the number of dwellings but after I send my resource consent to council and engage in that process I am left with two 'new dwellings' which qualify for the new loophole.

I expect there will be a lot of this type of behaviour which has now been incentivised. Councils are going to find consenting timeframes blow out even further as a result. Is there an answer for this? Has it been acknowledged as an issue?

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I doubt there are a lot of places with two full dwellings on one title. I'm not sure how keen the council would be to allow a minor dwelling to become a main dwelling. 

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Can also exploit the new loophole by knocking down an existing dwelling and building a new one in its place.

There are heaps of titles with more than one household unit on them already though.

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You have to calculate it if it has sufficient outdoor living space, front, side yards etc to qualify to become a separate dwelling. But you also have to increase its size in order to make it big enough in terms of living space to take it out beyond being a minor unit. 60m2 or 65m2 to be safe, some rules now use 65. You then apply for a certificate of compliance, pay a part development contribution (a legitimate minor unit has a 60% rating, so depending on new size, it may qualify to become an 80% or 100% of a household unit equivalent) and bobs your uncle. 2 dwellings on the site.

Next step, resource consent to subdivide. If desired.

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When all the cheerleaders crow about growth, I'm guessing they didn't mean growth in room to move? 

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Room to move in terms of walking up and down stairs.

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and the infrastructure to support this will be in place......when?????

if anybody needs to know what a disaster this will be - I suggest going to Sydney or Melbourne where there are regular electricity brown outs, Traffic Jams where it can take 1 hr to drive 10kms, sewrage problems and parking issues- all because they moved to medium and high density 10 years ago without supporting infrastructure.

putting more people in one area only works if you have the roads, electricity and water systems to support more houses and more people - otherwise your creating more not less problems.

 

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Its only really storm water and sewerage that are a problem. Excess people actually creates the solution to transport issues: public transport. 

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Because that's working so well in Tauranga, parts of Wellington and Auckland (especially on the North Shore) - you do know buses sit in those traffic jams with all those cars.

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Because  they aren't dense enough. It works well in Tokyo, London, etc...

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Exactly Cities with populations c.10m+ it works great. That's not really helpful in a NZ context though is it?

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I think we've been mislead to believe that public transport only works at mega-scale. My favourite city in the world is Bergen, Norway - population 285,000. They think nothing of tunnelling through a solid granite mountain to connect 30,000 people on the other side of the hill to their light rail network. Oh and you can cross the alps (from sea level to 1,237 metres then back to sea level) from Oslo on a comfortable commuter train that runs 4 times a day. It's just a question of priorities.

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Tell that to the people living in South East and North West Auckland, who are seeing thousands of houses added a year with no hint of the Light Rail that they were promised four years ago. Or the people in the North Shore who still have no upgrade path for the Northern Busway despite it being projected to hit capacity in the next 5 - 10 years. 

Your theory only works if Central Government has the capability and inclination to actually build public transport. At the moment they don't seem to care about anything unless it directly affects Wellingtonians. This has been Auckland's problem for decades, it would be insane to think it will suddenly change. 

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That light rail was only meant to be completed in 2021. 2021 isn’t over yet, so you can’t slam the government for failure to deliver, just yet. 

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Why is it central governments job to build public transport? It's a local and regional government responsibility. Problem is they are hamstrung by property owners unwilling to play the rates necessary to get it built that keep voting in councillors promising to spend as little as possible as infrastructure stagnates.

Central government is only getting involved due to the short sightedness or should I say ineptness of local government. Public transport, now three waters, what's next?

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"Central government is only getting involved due to the short sightedness or should I say ineptness of local government. Public transport, now three waters, what's next?"

Does local government set migration settings that adds population pressure? Light Rail started out as an AT project before Labour took it over post-2017 election. It takes some effort to get something this wrong, but you've managed it on both a logical and a historical basis. 

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The government should never have taken over the light rail, but they only did so because AT didn't have the funds for it. Local governments don't set immigration settings, but they do plan for where new housing should be, ensuring it is appropriately provisioned with water, sewage, local roads, amenities, and public transport. Why would public transport be something they offload to central government? It makes no sense.

 

There should be communication about immigration settings and how it will affect cities, but unless you're saying that all that infrastructure should be provisioned by central government as they control the immigration lever I don't get where you're coming from.

 

The funds have to come from somewhere, by putting on central government your asking it to come out of income tax, gst, and company tax, but that makes no sense when it's property owners that benefit the most from it in increased values.

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Yes, that is exactly what I'm suggesting. If central government wants to add a million people over 25 years then it has a fundamental and moral obligation to ensure that the quality of life for existing taxpayers isn't adversely affected by that deliberate policy decision. That includes provisioning for infrastructure so that the city isn't three decades behind population growth in terms of sewerage, transport and land availability.

And last time I checked, the citizens who are wearing the costs of having more and more people added in while central government pretended they came with no additional pressure on infrastructure are the ones who pay GST, tax and company tax. Carving out a portion of that to ensure they are not excessively affected by migration settings set by central government is an equitable outcome, unless the idea is that you can continue to foist costs and drain the living standards of a population and then look the other way when it comes to actually providing the basics for them to generate your income tax, GST and company tax that your core revenue is reliant on. 

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It's the property owners that reap the rewards through massively increased property values, so it's more equitable for them to make a contribution over income tax payers who as you say, bear a cost but don't reap a reward.

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I don't think it is short sightedness, just that central government has all the money. In our household for example, about $3k rates goes local (actually 15% GST of that goes central), and about $50k tax goes central (PAYE, fuel excise, alcohol excise, GST, etc). 

Until now central have spent it all on motorways in Auckland, and the result speaks for itself. 

 

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But that's the problem, why should our tax system be tilted so far away from property owners to income earners. It's one of many reasons why the way to make money here is to own property, not to have a normal job.

Imagine if a councillor said we're going to increase Auckland rates by 20% (~$400 million per year) to start paying for decent public transport. I doubt they'd get more than a tiny share of the vote, but that's what's needed. Funding is a zero sum game, if you want the infrastructure you have to get the fund from somewhere. For public transport its property owners particularly in the vicinity of the new stations that benefit the most due to increased property values especially with the NPS-UD that allows such increased density in the locations, so they should fund it.

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Agreed, but the democratic makeup needs to change for this to occur. Most people don't vote because it feels like the system is already rigged. Our current "left wing" mayor campaigns on below inflation rates increases for example. Property owners have more to gain from voting and so outnumber renters.

Also rates are much more in your face than tax. People continually complain about their 3k rates even though it is usually a fraction of their tax which they don't really see leaving their pocket. 

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I agree with the "in your face" comment. I always wonder if councils gave you say a 5% discount to pay your rates via direct debit weekly if people would be less fixated on rates increases. I think to most people 50-100 per week sounds a lot less than 2500-5000/year

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"For public transport its property owners particularly in the vicinity of the new stations that benefit the most due to increased property values especially with the NPS-UD that allows such increased density in the locations, so they should fund it."

Wow, no shit, if you starve somewhere of basic connectivity because you spiked demand and didn't cater for it, then yea, prices in the area go up when belated and usually tokenistically do something about it. If you leave it long enough, the cost blows out when it becomes a hugely expensive retrofit, like the Eastern Busway. 

If your suggestion is that Auckland gets back a proportion of the Income Tax, GST and Company tax it generated for decades prior to the mid 2000s that was disproportionately spent in other parts of the country at the expense of Auckland's infrastructure, that's a conversation I'd be happy to have. I'm sure we could come to some arrangement with very competitive interest rates. We'll even give you a discount on the bits of the Christchurch rebuild and uninsured risk we chipped in on as well.

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No issues with electricity, telecoms or mains water according to Jimbo.  Those networks all just sprout from the ground without huge expenditure apparently...

 

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Ikimpaul, yes there will be additional load on infrastructure but that is a result of population growth. This additional load on infrastructure is far better dealt with by densifying existing centers rather than by creating new satellite town

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This is very true.  Both parties continue to duck the question of what sort of level of population growth we want. The reality is most kiwi's aren't "anti-immigration" but don't see the value in just trying to fudge nominal GDP and keep wages low via very high levels of immigration - net migration averaging 50k a year over the last decade has been done with no planning or foresight and we are now paying the price.  

What was wrong with net migration averaging around 10k per year?  We sure as hell never had the highest levels of rental stress and homelessness until National drastically increased net migration (and labour just continued, despite campaigning on reducing those numbers).  Our annual net migration figures went from averaging around 10k per year to averaging 50k per year, but plan was put in place to develop the housing, infrastructure and services to support this.

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Seems relevant that house prices rose faster under Labour before National got anywhere near government, with relatively little spend on infrastructure while we paid down government debt instead. 

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Yeah that's what I am worrying about. There is nothing wrong to build more apartment to provide more supply for housing. But how about transportation, roads? How about carparks? How are people traveling to work? It is lack of planning from governments I am not happy about. 

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Labour has snookered National as this densification without resource consent will require councils to pay most if not all for sewerage and stormwater upgrades. As far as I'm aware the development contribution to sewerage and stormwater is part of the resource management consent. RMC will no longer be required, only the building consent. No RMC no development levy?

It's likely the three waters will now become more attractive to councils who have to make up shortfalls in upgrade costs.

I think National is opposed to the three waters.

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In a lot of places the development contributions are triggered by the resource consent or the building consent, whichever is first, so it gets charged regardless. If not, councils will be all over this to make sure they have policy in place for it when these changes come into effect.

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That's right but Reserve Fees/Contributions (different to Development Contributions) are paid on resource consents; e.g.,

http://www.huttcity.govt.nz/Services/Building-and-resource-consents/Bui…

DCs go toward reticulated infrastructure (the three waters) - whereas reserve fees go toward social infrastructure (playgrounds, bike paths, parks and reserves, etc.).

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Do you remember the 2 fat slags from VIZ comics?

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Wow, that presser has to be galling for Collins. Knocked down a peg presenting with Woods with Ardern nowhere is sight...

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Seems to be a big change in direction recently though from National. I think they now realise that National need to be the very similar righter-wing alternative to Labour, not the polar opposite hate everything Labour do party. 

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The Nash Equilibrium, National are starting to get it at long last. To beat Labour they need to move to the left, not right.

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This doesn’t do anything to make housing more affordable.

The government continues to ignore that the only way to produce affordable housing is to accept the financial loss of selling a home below cost. National are fools to attach themselves to this announcement when they have no way of producing the supposed outcome.

So you can build three three-story houses/apartments on a section? A wealthy family can simply decide to build one three story house on their section. Now their $1m home can be worth $3m.

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Exactly.

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Yes it does make land cheaper.

A piece of land is worth $500k

That piece of land is now rezoned to build 3 dwellings and as a result the value of the land goes up 50% to $750k

But one can now build 3 houses on that $750k land so the land price per house has halved to $250k

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They didn't teach you economics at architecture school did they.

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No but I did study Urbanism, which is what this article is about.  Would you like to point out more precisely what is wrong about my economics above rather than making just an unsubstantiated slag?

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We don’t measure land price by how many houses are on it. We measure it by how expensive the land is. In your example the land price increases 50% because of it being subdivided. That means the land price increases 50%. 

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It depends on whether you are talking about land price or section price. I agree with Yvil (for once), section prices are all that really matter to people wanting to get into the housing market. (but land prices are what makes existing land owners rich). 

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Land prices go up only when there is potential to develop. Once the allowed three dwellings are done, future land value increases would be not that high. 

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This has the potential to be a massive own goal. This takes significant pressure of the central areas affected by the UPS which had to allow much higher building heights, which was focused around transport routes and areas that had the infrastructure to support them.

Commonly held wisdom also suggest central sites need much higher limits to make the cost of land worth building on, so all this has done has meant intensification is more likely to happen in areas where land is cheaper and that may not have any access to rapid transit at all.

On the face of it, it seems like a good idea. But scratch the surface and there's a decent chance we may just end up adding density to the areas that can't support the population burden they already have.  

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Also means less areas for groundwater to soak when the density of housing is increased, and with the increased extreme flooding events we keep seeing, get ready to amplify that even more.

Flooding in some towns will definitely be made worse by this.

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Exactly, massive own goal.

Why build multi level apartments near train stations when you can do quick and nasty 'build and runs' on tiny suburban sections anywhere?

What a joke.

 

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Forgive my ignorance, but does this just mean that sections that are already developable no longer need resource consent to go up? 

Or also that sections that are in single housing zone can also be developed? 

Stuff’s article implies the former, the fact sheet the latter. 

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Resource consent is needed only if your plans are outside the existing planning rules, if they are within the planning rules you only need building consent. So I assume it means you will no longer need resource consent to build 3 houses on any site (just building consent)

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Won't need resource consent if you comply with 3 storey height and 50% building coverage, and build no more than 3 houses.

Will be interesting to see if they have any other rules  or if that's it...

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The part of this which I do not understand as yet is whether these 3 houses will then all be on the one property? Or do these rules mean that you can subdivide without resource consent and have them on separate freehold properties?

Having 3 on the one property would come with issues such as not being allowed a free fibre connection to each separately, having to assign an address to each which is not recognized by council, getting a separate water connection to each etc. May not be insurmountable but a hassle nevertheless. eg I had to have 3 goes at getting a separate fibre connection to a legal second dwelling. (Using the spare from one was not acceptable to me: a spare is a spare in my book). It did eventually happen but still don't know what changed or why it went ahead.

Another thing: 3 stories does not necessarily mean more dwellings. Many will presumably just be massive houses. In Ak the unitary plan says that you can have 3 houses per site already as of right.

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Good question. Will it allow an as of right subdivision approval, or do you get the land use rights then have to go to council for subdivision approval?

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There would have to be wouldn't there? Height to boundary etc? 

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Nope there doesn't have to be, govt is making the rules. But they might *potentially* have a height to boundary rule.

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I assume this change only prevents councils applying maximum dwelling rules. All other council planning rules still apply. 

If it is anything like the original NPS it will be more like a requirement for the council to change their current planning rules to enable this. 

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Thanks JimboJones.  I guess what I meant is do single housing zone houses suddenly become developable? 

We live in a single housing zone, it’s quiet and suits us, we’d probably move further out if that is the case.  

 

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I assume so, otherwise what’s the point?

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"Further out" probably needs to be outside the city to prevent this happening.

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Yes I think this will consequently push the value of rural and private, larger blocks up.

 

Exactly what I've got with no rear neighbour and can't be built in/ out. 

 

I'm guessing huge swathes of NZ will soon be covered with oodles of nasty little boxes jamming people in next to ea other. Who will willingly live in or buy these? Are they intended for owner occupiers or renters? 

 

Once again, I'd like to know what both sides of parliaments end game is, what is the plan, where do they want us to be heading and what is the vision? 

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Developments in Milwater and Silverdale are as you describe chillbin boxes all the same right next to each other. They are also all the same color, white with black roof. As to who lives in them, well all the agents selling them are Chinese.

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Great!  We absolutely need densification over endless urban sprawl. This leads to less traffic, less pollution, less grab of arable land, denser and therefore more vibrant city centers

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100% agree, but it does little for our current housing debacle in the short term

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It might be enough to reduce the fomo and narrative of property as a one-way-bet, and the effect could then be immediate. (Why should I go out and offer 800K on a 2bed unit this summer when in 2 years time there might be half a dozen new townhouses sitting next door).

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This does little to encourage intensification in central areas - arguably it does the opposite by making it easier to develop across the whole region. If you're a developer, do you gamble on a project in the inner city, with high land costs and well-funded NIMBYs all around you, or do you do a bunch of projects in the exurbs on a smaller scale where the land is cheaper? 

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Bingo.  All the dense development is happening on the far outskirts of the city.  Its lunacy.

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My absolute favourite: Hobsonville Point, poster child of medium density living, where you'll pay $1.4m for a three bedroom terraced home and parking is minimal, took about five years to get a ferry service on weekends. 

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That is currently true as the rich Nimbys in Auckland Isthmus suburbs applied pressure to prevent any rule changes in their neighbourhoods. Hence why most of Epsom, a suburb very close to the city centre, is zoned one house per section (and sections are often over 1000m2). Not any more I guess...  I assume Act do not support this policy due to the Epsom factor despite it being everything they should stand for?

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Very few houses in Epsom have 1000sqm to themselves anymore. Not a lot of town houses, I give you that, but it has certainly been infilled a bit over the last 25 years. Exclusive school zones end pushing up land prices are a pretty good incentive for existing home owners to subdivide where possible.

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Exactly. Imagine if "where possible" wasn't being limited by the council to "protect" them? It should be all 10 story apartments IMO. 

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Funny, Ponsonby, Grey Lynn, Mt Albert or any of the other electorates never have to face this question despite being equally if not more central than Epsom. 

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Epsom has a lot more single house zone, a lot more large sections, and a lot less density. But yes it applies to all of them too!

Realistically a single house zone just shouldn't exist near any large city's centre. If you don't like people near you, the city centre is probably not the ideal location to live. 

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Frankly I've never understood why the Outer Link Bus route wasn't used as a 'this is where we intensify' ring. If you want the treats like frequent turn up and go transport, you've got to be prepared to play the game.

If not, fine, redeploy those services to outer suburbs with far less utilities and transport options. This is why I liked the UPS so much. This latest change severely waters that down. 

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There's something we can definitely agree on. I do worry that they'll under-deliver on infrastructure, although that could only be by design if it's the first thing to spring to mind to practically everybody on this site.

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Anything that boosts the supply of housing is virtuous - especially in Auckland and Wellington (and certain other cities such as Palmerston North).

The acute shortage of houses of a few years ago has now turned into a chronic shortage.

Despite the forecasts over the past 25+ years of a "crash" or "major correction" in NZ house prices, no crash has happened. House prices continue to increase.

Because property ownership/investment is such a deeply-entrenched goal of NZers - and because NZ has become such a popular/sought-after destination abroad - the more new houses that we can build the better.

TTP

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Building more houses is a fine goal. I’d love to see what they are going to do about poor infrastructure, lack of supplies, lack of skilled workers. 

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Another substantial transfer of wealth to landowners, likely tax free too if you've had the land for a while or do new builds.

 

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Yep more windfall gains! If you have a section that's at least 300 square meters, it's probably increased in value by at least 10-20%.

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It's probably increased by 50% but since you can now build 3 dwellings on it, the value per dwelling has halved, wonderful isn't it?

Land $500k + 50% now = $750k / 3 dwellings = land price $250k/dwelling  win-win

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This is another blundeelr by this government which has no clue what's going on in NZ. In 10 years, this labour government will be responsible for creating slums in NZ. Just stop the flow of free money in the market and everything will fall in place. People should only be allowed to buy what they can afford and shouldn't be let to use leverage on equity which is a false economy. 

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Most of these dense new builds are quite nice compared to the old uninsulated land hoggers. And this rule change will enable it to happen in better places than the current Nimby inside-out planning rules of Auckland. 

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The quality of what is being churned out today is absolute rubbish and they will be had it in a couple of decades. All that damned polystyrene under them, all the garbage fixtures inside, nothing will be reusable. They are going to create a massive problem in a very short time

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I'm a bit slow today, please bear with me. So my 630sqm walking-distance-to-Wellington-CBD property with a 100sqm house on it just went through the roof, right? 

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Siri, show  me a clear signal the government intends to go back to 50,000 p.a. net migration as soon as possible. 

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This new law is about providing more dwellings which are needed for NZ, it's  NOT about whether population growth is desirable or not.  When we accept NZ needs more dwellings, there are broadly two choices, building outward of city centres, creating new suburbs which grab arable land, create more and longer traffic commutes to town which means more pollution or building within the existing city by allowing more dwellings per land.  This results in a denser city which is generally more vibrant and good for cafés, restaurants and most business. It is a good law folks!

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It's not a good law.

As others have said, it will disincentivise apartment development near train stations and centers.

It will incentivise lots of shitty 3 unit development all over the place in a totally incoherent pattern.

Density makes sense if it is focused and well located.

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That's absolutely untrue

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So you think lots of crapoy 3 townhouse developments scattered widely and ad hoc  across a suburban area, remote from services and public transport, is a good thing?

Interesting view on urban design and cities.

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"The Government, with the support of National, is proposing to rush through an urgent change to the Resource Management Act (RMA) to enable more houses to be built in cities"

Note the words "in cities" not suburbs

and to answer your question, yes I think any law which makes it easeier to provide accommodation which is badly needed in NZ, is good

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Wow...what a knob.

Cities include suburbs...

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Why is it untrue? Why focus on risky and costly apartment developments in good locations when you can do lots of ad hoc 3 townhouse development anywhere without needing resource consent?

It totally disincentivises good quality apartment development near centers and train stations.

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Isn't this in addition to the existing NPS?

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yes but it comes in sooner and why bother with the cost, hassle and risk of building apartments near train stations when you can do quick and nasty 3 dwelling developments on small sections anywhere,

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It will come down to demand I reckon, which sounds like a pretty good outcome to me. If people prefer "nasty 3 dwelling developments on small sections anywhere" then they will buy those. I get a feeling both types will be popular. 

Until we have too many houses in Auckland, I estimate we are not far away. 

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Developers still have to *sell* the dwellings.

A townhouse close to train stations, etc., will still be easier to sell than one on the fringes.

Granted, in the current market, people will buy any old crap and those details are irrelevant. But all else being equal it will still make sense to intensify more where the amenities are, because people will pay more for those developments.

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https://sleepyheadestate.co.nz/

Take 'jobs to the people' and not 'people to the jobs'?

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Interesting, government bipartisan efforts to save developers, right after Stats NZ just released the CPI data yesterday, the timing of this couldn't have been better.

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Great. Yet another million dollar handout to land owners. Well done Labour! When people thought there was no way to make inequality deeper, you managed to do it again!

This also makes infrastructure issues much worse. Two birds with one stone! Any chance Twyford was behind this?

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People need to be housed. 

The popping of champagne corks, and the ting of long stemmed glasses. As the propertied classes met this decision with hearty approbation!

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Comment section surprises me.

Are we saying that the government should have done the opposite and made intensification harder?

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Well said Simon Ro, to my amazement you seem to be the only one so far who understands urbanism and the point of this new law

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No, we're saying they should have stuck to their original NPS plan and focused intensification on the areas with the infrastructure already in place to support them, in central locations.

They've effectively undone this today.

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Comment section surprises me.

You must be new here ! 

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There are two reasons to beware of this proposal.

1) Name one Govt. (National and Labour over the last 2 decades) action that has resulted in housing becoming more affordable on a like-for-like basis? In fact, it is easier to put a case forward that their very actions do the opposite. The trend is not their friend here. And:

2) If you understand land and development economics, it is quite obvious to those of us that do, what the flaws are in their system. And it is just as much about what they don't mention as what they do, in that they don't even know what questions to ask. 

I could write a book on why this won't work, but others already have. Read some Alan Evans, and Alain Bertaud.

 

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I support the idea but it doesn't go far enough.

A really well designed city like Barcelona has a population density of 16000 people per square kilometer and a hotchpotch like London or Paris around 5000 people per square kilometer. Unfortunately Auckland has only about 1200 people per square kilometer so even if the city limits where held the population would need to more than quadruple which will never happen.

We actually need to redevelop Auckland starting with a bulldozer. Auckland can never be infilled sufficiently because it's just sprawled too much.

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Any development without carparks is, in the long term, an undesirable slum in the making. How National can agree to this beats me. 

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Ponsonby is a development of small close together houses without car parks. Slum? Maybe 50 years ago that thinking was valid. 

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Ponsonby used to be cool

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Bring back the Gluepot

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Had some great days there in the early to mid 90s. Ponsonby has lost much of it's soul.

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Who wants to live cooped up like a battery hen? The sort of people that we would want to hang on to and contribute to our economy, will aspire to something better than this.

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No one "aspires to something better" in Tokyo, London, New York, etc? No one is forcing anyone to develop their property, just giving them the right to (and allowing supply and demand dynamics to a very broken land market).

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A step in the right direction. Although it will inflate land values on those sections where the new rules apply.

And the supporting infrastructure must also be the immediate priority. Apart from that being done, all good!

 

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It could also deflate land prices in places where the rules already apply as those places are no longer so special. Some South Auckland places are getting stupid prices just because of their planning rules. 

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Exactly. Average suburban properties are now getting $5m+ in places like Manurewa because they're big enough to have units built on them. With densification possible across the whole city, I don't think that looks like a good buy anymore (if it ever was...)

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"Govt unveils surprise law change..."

I imagine this law change isn't much of a surprise to the developers who have acquired a significant number of properties at (seemingly) ridiculous prices over the last 12 months.

Curiously, I'm not convinced this will cause much of a change to land prices in areas where this will apply.

It feels like the upside is actually going to be in areas where it doesn't apply, as people will always pay a premium for the privilege of not living in what will inevitably become a socioeconomically depressed area within 10 years. Such areas will also have a lower turnover of stock, meaning a supply and demand imbalance while the areas that intensify will have a higher rate of turnover and be more sensitive to cycles.

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I really have trouble believing that the demand is due to fundamentals:

https://figure.nz/chart/Zm0drr8mzoKOUebS-kszm8NVFhm00CWRr

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Ssshhh! Don't let the facts ruin such a profitable narrative!

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Land Price / house price will shoot again and new ghetto build build on them will sell for million plus. 

Is government helping or boosting ponzi.

If sincere should release land in far off suburbs at low price to solve the crisis. 

Release land ( section between 400sq Mt to 700sqmt) with infrastructure between Auckland and Huntly as that only can help otherwise land / house price are bound to move upm

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Well done National for proposing this solution, well done Labour for listening and agreeing to it !

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The other big issue is they WON'T be affordable, or anything close to it. 

A 3 x 3 bed townhouse development on a 400 or 500 square metre section in Auckland, once you have factored in inflated land value, development and build costs, profit margin and GST, will need to sell for more than circa $1.2 million, and that is in a low-medium value location.

If they were 2 beddies they would need to sell for at least 950k.

So, nowhere near affordable, and there will be limited demand at these price points, especially with increasing interest rates, possible DTI etc.

So I take back my concerns about crappy outcomes - it won't be a big problem because not that much development will occur.

It's a big fail.

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The word affordable is also linked to interest rates and wages. As interest rates rise and wages stall,  houses at existing prices become less affordable,  unless they fall in price. 

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The way to test these good-sounding ideas is to measure the results, assuming the Govt. knows what a good result looks like.

And the result should be, on a like for like basis, the housing built because of this new rule is of better quality and is more affordable.

So far there is no change that they have made that meets this test, ie all housing is generally of poorer quality and less affordable.

And there are so many unanswered questions about this proposal, that by the very nature of them being unanswered, means that it will more than likely fail, as have all previous attempts by them have.

There is not enough time or room on this post to go over the possible failings of their proposal. 

But I'm sure (am I?) this is just a brief announcement and all the detail for how the whole system will be delivered and work will be released next.

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Isn't it putting potentially a lot more load on existing infrastructure?. Planning rules are there for a reason and councils have to plan for infrastructure. Why not increase green field sites, as new sections are artifically constrained due to people landbanking. Covenants also prevent many people subdividing their property anyway,  so they can't build a house on the back of their section, even if they have a large section. 

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Yes, and you are hitting on exactly some of the many obvious questions their plan fails(yet?) to address.

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Great, now whos going to build them? And with what?

 

There's plenty of developers, investors, planners, architects, engineers, interior decorators, exterior decorators, landscape designers, services designers, service engineers, geotech, surveyors and lawyers. Unfortunately their endeavours are worthless and none of them produce anything of any substance if there is no-one ready to pick up the shovel or hammer, and there is no concrete or wood to shape into a habitat. 

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How on earth did someone figure Nelson / Tasman was a tier 2 area. Hamilton has 10 times the number of rentals advertised compared with Nelson / Tasman. But it’s population is nothing like 10 times bigger. Their building consents / 1000 population is way lower also. Tasman is consenting 10 dwellings / 1000 population same as Auckland. 

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I think the value of my student flats all just went up 500k. Cheers JA

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Yay more slums...We need to release land don't we?

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Good old fashion land banking is back!

Be quick!

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You are far too slow.

Savvy investors were in, hunting for property last year when the NPS-UD came out.

I helped my uncle get a property in Wellington that will probably be twice it's value by mid next year.

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Will this at least mean the good quiet people of Dunedin and Invercargill might once again have a chance to afford a modest local home at a price equitable to their meagre wages without having to bid against 5 pairs of brash and ruddy boomer 'investors' from Auckland, glossy and plump with their untaxed windfall equity, pockets stuffed with thrice leveraged, Government subsidised, bank printed credit? 

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I guess we're about to see all the beautiful established suburbs ruined with ugly out of place monstrosities.  The view of the ocean that you paid handsomely for will be replaced with a vista of the neighbours toilet window. 

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History is lovely. I'm the first to admit I have an obsession with character homes, but protecting the old at the cost of the new is totally unhelpful NIMBYism.

City centre has the established infrastructure (mostly) for development and the convenience that the majority of people need so they are not spending huge portions of their lives commuting.

Move the big old houses out to a lifestyle block in Whitford / Kaukapakapa. Anyone that can afford to own those properties in the first place can afford to downsize and stop working in the middle of town.

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To me it seems they want the main roads and areas not adjacent old shopping centres are excused. The bill only mentions three business zones and their adjacent zones

But I may be confused

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It's clear that rapid population growth via the importation of people is pretty well baked in.

Madness if you ask me.

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There is a parallel issue that the Govt. fails to address when they make these type of sweeping changes, that is, their breaking of the social contract they make with individuals, or in this case a street or suburb wide community.

And the social contract was, we, the individual/community, will hand over to you the management of our neighbourhood (which we will pay you to do via rates) on the condition that you manage it for our benefit.

In past history, prior to the need for community-wide management, individual owners on a handshake agreed to the terms of how their neighbourhood was to develop. and then as this grew turned into managed communities and then citywide. 

The trouble with this type of growth, as more people are involved, the less that individual needs are met by the bureaucracy.

And this need is hard to meet, not only because as individuals you become just a cog in the machine, but Govt. manages in such a ham-fisted manner they lack the skills to manage for both the individual and common good, which are not necessarily incompatible binary opposites.

Thus it's not that the increase in density is bad per se, but it's the way they are doing it that is the problem, and also points to a wider poor governance issues.

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The more people there are, the less personal choice is able to be catered for. 

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Not if all those people with the same personal choice decided to live next to each other and form their own community with their own rules, which in effect were the first reasons historically for people to get together.

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Could someone help me understand all of the benefits (intended or unintended) of this change for someone who already owns a section that could potentially (speaking in a physical sense rather than a legal sense) fit three homes on it? I am not in this position myself, but I'd like to know the different ways this would benefit the current owner of such a property. Perhaps a working example could be provided?

If i was the owner of a property which has the theoretical space for 3x 3 storey homes:

1) The development potential of a such a property increases due to the new change in zoning
2) The cost of the land increases in response to the new development potential
3) The cost and time to get to the point of building consent reduces

Apologies for these novice questions.

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The relationship between density and unaffordability, ie more dense less affordable.

https://www.newgeography.com/content/007221-higher-urban-densities-asso… 

 

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