Legislation that will fast-track housing developments has now passed into law

Legislation that will fast-track housing developments has now passed into law

The Housing Accords and Special Housing Areas Bill passed its third reading in Parliament today 63 votes to 56 and will come into effect Monday 16 September.

The main initial focus of the new law would be to enact the Auckland Housing Accord through which it is planned to build 39,000 new houses in a three year period in the Auckland region.

Housing Minister Nick Smith says he expects the Auckland Council to approve the accord next Tuesday and is talking about having special housing areas approved by Christmas that would be able to cater for 5000 houses.

Here is Housing Minister Nick Smith's statement on the new law:

“This new law will deliver tens of thousands of new homes. The increased land supply will help take the pressure off the over-heated Auckland housing market and help the economic recovery. It will enable tens of thousands of kiwi families to realise the dream of owning their own home,” Housing Minister Dr Nick Smith says.

“The game changer in this new law is the unblocking of the constipated planning system. It will enable plan changes and resource consents to be processed simultaneously. It will over-ride Auckland’s Metropolitan Urban Limit. It will enable low-rise greenfield developments to be consented in six months, when they previously took three years, and low-rise brownfield developments to be consented in three months, when they previously took a year.

“The Auckland Housing Accord will be the first to be recognised under this new Act. It will enable the Auckland Council to get on and consent the least contentious 39,000 homes of the 400,000 identified in its draft Unitary Plan, rather than waiting three years for it to become operative. The Government is also having discussions with other councils in high cost housing areas on how the tools in this law can assist in addressing the housing supply and affordability issues in their communities.

“The Labour, Greens and New Zealand First votes against this law contradicts all of the advice from the Productivity Commission, Reserve Bank, OECD and IMF that increasing supply is crucial to addressing housing affordability. Their opposition shows they are more interested in playing politics than working with the Government and councils on addressing the real problems affecting the housing market.

“The new initiatives in this law are just part of the Government’s substantive programme on housing affordability. We also have work underway to reduce infrastructure costs on sections, address the costs of building materials, improve productivity in the building industry, and reduce compliance costs. Our next phase of RMA reforms will require councils to plan for 10 years of land supply for housing. We have also announced initiatives to treble the number of Welcome Home Loans and expand KiwiSaver to help first home buyers save a larger deposit.

“Parliament’s passage of this new housing law today is a vital step to getting momentum and pace into residential housing development. Next Tuesday I expect the Auckland Council to adopt their Housing Accord and to notify their draft Unitary Plan. This new law takes effect the following Monday enabling the first Special Housing Areas to be considered. My ambition is to have sufficient Special Housing Areas approved by Christmas for at least an additional 5,000 homes.”

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19 Comments

Does anyone know where the special housing areas in Auckland are?

Quote: "It will over-ride Auckland’s Metropolitan Urban Limit".
 
Heaven forbid I nearly had an orgasm. I look forward to those more expert than myself decoding the political power behind this accord. That is, the degree to which it gives central government the power to over-ride Len and his Loonies.

.. now if they can just pass some special laws to bypass that bozo who's obstructing and convoluting progress down in Christchurch City .... " Bulldozer Brownlee " ......

Yes Andrew, ‘overrides the MUL’!!!, but might be a little too early to get that excited.

My understanding is that the Accord will highlight special areas within the present MUL that will be given priority.

Highlighting an even smaller amount of land will not make housing more affordable, even if it results in more sections/housing being released.

But I would be interested in knowing if land outside the MUL can now be more easily developed because of the new legislation.

Yep - that's the question. How will central government's power be used in practice. The ideal is for a developer to be able to approach government with a significant project, and have it approved...on *rural* value land, and whether Auckland council likes it or not.

New Zealand is the world leader in progressing workable solutions to the housing affordability issue.
As Kiwis, we should all be proud of that.
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don't know about that; it could just be the result of interest groups leaning on government and the media.
consider the musings of the  Savings Working Goup:
Clearly, there are serious questions to be asked about New Zealand’s economic policy and how we got into this mess. Why was it not better designed and managed, and more focussed, coordinated and strategic? Did the electorate simply get what it voted for, without realising what was really happening, or have New Zealanders not been well served over the years?
The SWG blamed tax breaks for property investors and high immigration for house prices.
Savings Working Group
January 2011
“The big adverse gap in productivity between New Zealand and other countries opened up from the 1970s to the early 1990s. The policy choice that increased immigration – given the number of employers increasingly unable to pay First-World wages to the existing population and all the capital requirements that increasing populations involve – looks likely to have worked almost directly against the adjustment New Zealand needed to make and it might have been better off with a lower rate of net immigration. This adjustment would have involved a lower real interest rate (and cost of capital) and a lower real exchange rate, meaning a more favourable environment for raising the low level of productive capital per worker and labour productivity. The low level of capital per worker is a striking symptom of New Zealand’s economic challenge.

http://www.treasury.govt.nz/publications/reviews-consultation/savingsworkinggroup/pdfs/swg-report-jan11.pdf
In an Australian context, the Productivity Commission – hardly a hot-bed of xenophobia or populism – concluded that any benefits from migration to Australia were captured by migrants and there were few or no discernible economic benefits to Australians.
http://www.treasury.govt.nz/downloads/pdfs/mi-jarrett-comm.pdf
 

There has been alot of slagging off at the National government around here , of late .... let's just see where the two major parties sit regarding this bill ... National promoted & passed it , enabling the government to force councils to free up land for housing development ...
 
... Labour opposed it . Shadow housing minister Twyford claimed it's not a bold enough initiative ... but a CGT is ! And first home buyers grants . Plus government built " affordable houses " ....
 
Labour are deeper in denial than an Egyptian swimmer .... completely out of their depth ...

I am STILL waiting for an apology from Labour for its gross negligence in doing absolutely nothing to address the exploding housing bubble wau back in 2002 … as illustrated by this Christchurch City Council Quick Facts Graph … look at it and weep …
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you can blame these high minded folk:
Both in New Zealand and globally, the best of the leftwing tradition has always rejected small-minded nationalism, xenophobia and racism. In fact, leftists of an internationalist tradition have always favoured globalization and getting rid of national borders and barriers to migration. Progressive advocates of globalization of course do not defend a handful of rich imperialist countries, including New Zealand, dominating the world’s economy, but instead advocate an integrated and radically egalitarian world economy where production is based on social need and not on private profit.
http://liberation.typepad.com/liberation/2012/02/guest-blog-post-john-moore-leftwing-xenophobia-in-new-zealand.html
What would those old labour people have thought of Harcourts Shanghai profiling $800m of NZ "products"?
http://www.stuff.co.nz/business/money/4622459/Government-policies-blamed-for-house-prices
There was NO WAY the real Labour people such as Savage and Lee were going to allow lower income Kiwis to live in rat-holes like the British. This in large measure is why many of them left there to come here … where people get a fair go.
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The quater acre pavlova paradise didn't sit annonomously in a sprawling metropolis where  60% of the land mass is devoted to cars.
 

I think Phil Twyford has made some fundamental intellectual errors on this isue. He can't admit to them (and doesn't) because he wants to keep his status in the Labour party.
I hope Labour's next leader will see him for the clown he is, and replace him with someone who can look at things freshly.

I do apologise for being a major contributor to the ammount of slag being heaped upon the  party of benevolence and understanding GBH.......................................not !
I agree with your observation that Labour could have aknowledged the initiative as positive and responded in a more inclusive manner  inso far as a Central Govt response to a difficult situation.
 But there in lies the politics of dance , the childishness of seeking the contrary to create point of difference in policy.
 Perhaps we are not living in such difficult times nationaly  after all as opposed to localised areas,  consensus often arises Centraly speaking in the most dire of circumstance.
 The conclusion I'm left with  is the nitpicking will be to the benifit of some while the loss of others...... tiresome is it not...?
 However, I will remove my own hand with my teeth should I waiver over the Nats tick box wondering if I should not just accept the Devil I know.
 I'm still thinking Labour will need a small miracle to unseat ....the living smug....but at this stage it is their( Nationals) contempt for the average citizenry I abhor, ......I want it checked.....why there is no place for humility in a decision making process I do not know, but I suspect it's more of a case of , no place for it in self interest.
Stay well Mon Ami.....could be worse I suppose, Joyce could be running the show, oh no wait, better i think ...  openly smug arrogant and indifferent ....to John Boys tutored version of it.
 

 I'm still thinking Labour will need a small miracle to unseat ....the living smug....
 
In this clip is (in my opinion) the small miracle;
 
http://www.stuff.co.nz/national/politics/9132870/Jones-wants-to-string-up-Key
 
Granted the Michelle Boag's and all the other stiff shirts of this world will see it highly offensive - but the masses won't forget the message.  Here I think is a man who can out Jolly the Jolly Kid - shake off the 'chardonnay socialist' label and as a right of left candidate, National can't attack him with the same anti-socialist rhetoric they are using against the other two. 
 
I also noted that Hone said he could work with all three, but that his heart was with Shane - whereas Te Ururoa Flavell said he could work with Robertson or Cunliffe but failed to mention Shane. All very interesting. The Greens of course are absolutely mum. Wonder what Winston's opinion is.
 

Gummy, and Hugh,
My clear understanding is that the bill has endorsed exactly what the Auckland City Council was asking for. They had taken years developing their Unitary Plan; but then didn't wish to wait Amy Adams' 3 years for any of it to be acted upon. Am happy to acknowledge that Smith has overruled Adams and passed the legislation to allow the plan to come into effect more quickly. If you see it differently am happy to listen to how so. What bits of the Unitary Plan do you see being overruled in practice?
I am not at all sure even then that the economics on a house by house work in terms of building too many affordable cheap but new houses. It's not obvious that building costs and exactly who pays development costs for what has yet been sorted. Nor what the eventual outcome will be in terms of new houses being built. But it does seem to be progress. I have some expectation that new houses (assuming they are built) will probably be mid priced even if not conveniently located; but will take pressure off some not very impressive older houses in terms of price. Sort of like the new and used car market.
 
 

While any step to remove bureaucracy from the country is a good thing, I think many will be disappointed in the outcome of this bill. Like most property bubbles, Aucklands is blamed on a shortage of housing yet if you take a ride to the city limits you'll find plenty of sections forsale and houses that can be brought for much less than a central location. In the US prior to the GFC, housing shortages where the main stream reason for the ramp up in housing prices, as was the same in Ireland, Spain infact any where a housing bubble exists its always blamed on a shortage of houses.
The real reason that a buyer will pay an increasing amount for a property is not becasue they could not go else where to buy a similar sized house for less, they can do that today if they choose too. Its far more likely that this buyer pays the current asking price or bids up a price in an auction, because they believe that they are buying an asset not just a place to live. When a buyer thinks in terms of a house as a revenue generating asset he must be thinking its price will increase over time, which has been true for many years in central Auckland for sure and mostly true in outer Auckland. But will that be the case if large scale sub divisions spring up? How low will the price of a property need to be to induce a buyer to not purchase in say Onehunga and travel to Papakura and buy? Check the difference in prices for those suburbs today its probably around 20% ish, how big will that gap need to be to make new subdivisions in outer suburbs attractive? Or is there another reason for the continuing ramp up in house prices in Auckland? Maybe cheap money and the usual house is an asset thinking?

The thing to not forget is that if people can build their own new home, at non-inflated values, then they will do that for $200-300k instead of paying $400-600k for existing stock. You would be nuts not to. So you can't possibly get our kind of speculative bubble in the context where the new-build option is not choked off.
 
Dale: I like your note on 'true' affordable housing. This is why I believe it's so important to define affordability in terms of total build cost per-square meter. Otherwise you end up with people defining modified gagrages as "affordable homes"!

Stephen L – I agree in practise that the Housing Accord will achieve no more for affordable housing than what the MUL and RUB was going to achieve, ie nothing.

Affordable Housing was a last minute addendum to Auckland Plan.

The role of the MUL and RUB is to maintain the status quo, with the only ‘affordable’ housing being achieved by reducting housing size (higher density), and/or govt. subsidies for certain qualified people, both types of which are not true housing affordability.

LVR limits....sudden surge in new houses...possible interest rate increases....bursting bubble anyone????

”Decades of development and sprawl are rightfully blamed for the degradation of our quality of life, and for our near unbearable congestion. This has turned many Angelenos against development and into NIMBY activists ready to object anytime to anything. But contrary to NIMBY creed, we cannot do nothing. The path we are on is really an economic fiasco in waiting,” writes Mayer.
“In greater Los Angeles, we are using more than 60 percent of our land for our automobiles (roads, parking lots, landscaped buffers, traffic islands, etc.).” This, he says, is a recipe for economic disaster because a smaller proportion of the city creates value. He offers a vision of a new Los Angeles where the millions of dollars currently wasted in traffic can be diverted to a vibrant local economy and where quality of life is excellent.
“Imagine our city with bustling pedestrian zones, coffee shops, and corner stores, markets, plazas, and lots of housing options surrounding our public transit hubs. Then imagine those hubs separated by low-density areas filled with picturesque narrow residential streets, bicycle networks, community gardens, and parks. All could be connected with public transit, and all of this in our near-perfect climate, and you could still drive, if you chose to.”
“But we cannot achieve this by only making minor adjustments to our land-use laws based on the popular consensus of people who want to continue to drive yet want all the other people to get off the road. We need to change much more rapidly and radically and we must get people mobilized toward change. We must create grass roots “YIMBY” (Yes, in my yard!) movements that demand different solutions; that is really the challenge of our time.”
http://archpaper.com/news/articles.asp?id=6826

Hugh,
I wrote an email to Rodney Hide I believe it was back in 2006/2007 with an attachment to your demographia survey for that year that made it clear MUL's were the problem.
I said if nothings done I will stop my business/plans and instead pile into negatively geared investment properties as that's were the money seemed to be and were the rewards were based on law as currently set.  
It's been a long time coming... Thanks for your persistance in this matter Hugh

I think we also have an answer to the power of the future, thanks to this little phrase buried in HughP's comment river (he's such a Versatile chap):
 
"The REAL Labour people such as Savage, Semple, Lee, McMillan, Nordmeyer and many more of them, would be turning in their graves if they knew what the current crowd are up to."
 
So all we gotta do is hook a genny up, to harness the rotational energy of said spinning forefathers, and it might even beat PDK's waterwheels for output!