Government and Auckland Council announce 10 'special housing areas' with over 5000 housing sites

Great to FINALLY see this sort of action, of course 2-3 years late, but better late than never.

Bouquet to the Govt.

more housing where housing is already cheap and demand from first home buyers low.  Not very logical..

About time!  

The old Manukau and Waitakere city councils (now Auckland Council) were the two biggest land bankers in Auckland region.  Good on ya govt.

"The End of Suburbia"

Young people are shunning the suburbs in favor of the hustle and bustle of city life are leading the charge in the "reurbanization of America," said real estate mogul Sam Zell.

"The young people in America are being drawn to these 24/7 cities. The last thing they want to do is live in the suburbs". "In that respect, the demand for housing in urban markets is increasing."

The demand for the suburban life had been driven mainly by safety and schools. "If you want to see the end of suburbia, all you need to do is make the school systems in the cities triple-A and why would anybody live in the suburbs" end-of-suburbia-nearly-upon-us

two otherguys

nice in theory, but a major problem is the affordability of inner urban townhouses. Only a limited proportion of youngsters will be able to afford such locations, even if many would like to buy there 

Well done little Johnny & the Gnats ... makes a change of pace from the previous government , who sat around having endless yak fests , but never actually achieved anything tangible out of it ...

... grand to see some action , at last ...

Here's what the Labour Party made of the announcement:

Govt creates McMansions not affordable homes

The Government’s planning announcement offers little hope for first home buyers but developers will be laughing all the way to the bank, said Labour’s Housing spokesperson Phil Twyford.

“What we are likely to see is row upon row of McMansions. First home buyers and middle income families have been thrown a few crumbs as only up to 10 per cent of the promised 6,000 homes will be in the affordable range. Currently five per cent of new builds are classed as affordable, so this will make little difference.

“Given that Auckland house prices have increased by 13 per cent in the past year, the Government’s affordable homes hype is just a token gesture.

“Property developers will continue to build high-end homes.  Why would you build a house for $400,000 when you can build one for $800,000 and double your profit? 

“Who will buy these new homes?  Eighty per cent of first home buyers say they cannot afford the 20 per cent minimum deposit imposed by the Government’s new home mortgage lending rules. That rules them out.

“On the other hand, according to the ANZ Bank’s latest survey, 92 per cent of property investors say the new lending limits won’t affect them.

“National just doesn’t get it. Opening up greenfields land for property developers to build McMansions won’t give first home buyers and hard working families the break they are looking for.

“National’s planning announcement does nothing to address the underlying factors that make new homes so expensive: excessive profit-taking by land bankers, poor productivity and bespoke building practices in the building industry, lack of competition in the supply of building materials, and a property market over-heated by property speculation.

“Labour’s KiwiBuild policy is a bold and comprehensive approach to the housing crisis. We will build 10,000 affordable homes every year for 10 years. Building at scale will allow factory-built production, and bulk buying of building materials will drive down costs. Using the Crown balance sheet will allow Government to forego the developer’s margin and lower land costs while delivering high quality master-planned mixed income developments,” said Phil Twyford.

The New Zealand Bankers' Association had this to say:

Land for more houses good for Auckland housing supply

A joint government and Auckland Council move today to make land available for 6000 new affordable houses in ten more special housing areas has been welcomed today by the New Zealand Bankers’ Association as a positive step in addressing the housing supply issue in Auckland.

“The big issue in the Auckland housing market is a lack of supply. Freeing up land for housing is a move in the right direction to help improve supply where it’s needed and alleviate pressure on house prices,” New Zealand Bankers’ Association chief executive Kirk Hope said.

“Credit growth is currently around 5.4%, which is not high. The availability of credit is not driving Auckland property prices – it’s the lack of supply. Today’s announcement is a constructive move to address the supply challenge.

“We have the opposite problem that parts of the United States and Ireland had a few years ago where an oversupply of housing contributed to a fall in property values resulting in negative equity for many home owners. That’s not the New Zealand experience.

“Addressing the supply issue may also reduce pressure on the Reserve Bank to use tools like low equity lending restrictions in an effort to maintain financial stability,” said Hope.

Ireland had a swelling population of polish who came over to work while ireland ecomony was good... extra housing went up fast to accomodate them (sound familia?), then all the polish left, even leaving their empty cars at the airport at time... result.. more houses then people and house prices plummet....

Lets hope we really do have a supply problem and not just a speculative bubble behind the auckland house prices... More houses at this time will just make for a bigger fall in prices if it is a speculative bubble... (doesnt need to be driven by credit, just means people happy to pay way above fair value on hope that price keeps increasing...)

About 75 of those houses are a location where the residents might not each need their own car. Say 2 people per house that's another 9,850 extra cars dumped into Auckland's already overloaded roading network to keep the inner suburb NIMBY's happy.

So the $1billion economic loss to Auckland region each year due to traffic congestion just gets even bigger. The whatever many tons of CO2 dumped into the atmosphere gets bigger too etc.etc....yay

Watching Smith & Brown together is erringly familiar ….

"No question now, what had happened to the faces of the pigs. The creatures outside looked from pig to man, and from man to pig, and from pig to man again; but already it was impossible to say which was which."
- George Orwell, Animal Farm, Ch. 10

The irony is, as these sectors grow, they have incurred skills shortages which in turn has increased demand for skilled immigrants. The Department of Statistics ‘Long Term Skill Shortage List’ of 28/3/2006 includes carpenter/joiner, plumber, electricians, fitter and turners, fitter welders; all indicative of a nation building its construction/property sector. There is a danger that a sector of the economy is being augmented that is totally reliant on a small domestic economy. Not only do these industries have limited potential for per-capita growth but ‘deriving growth via factor inputs such as labour places pressure on infrastructure such as transport and land supply, and ultimately have a further negative impact on growth (ARC 2005). Finally, as the sector gets larger, it gains in lobbying/political strength and can lobby for immigration regardless if it is the best interests of the economy as a whole. This could be seen in Canada where the development industry has lobbied hard for high sustained immigration levels (Ley and Tutchener 2001).

• Nick Boles warned that young people are being prevented from buying homes

• He said that the arrival of 2million immigrants in last decade has left housing shortage

http://http://www.dailymail.co.uk/news/article-2332449/Now-houses-better-green-fields-minister-says-immigration-driving-home-prices.html#ixzz2hAD1pnRS

Unlike Auckland:

While oil made Houston boom, a more complicated set of factors made it sprawl. State annexation laws allowed the city to aggressively absorb surrounding areas, earning it the nickname of “the blob that ate East Texas.” A mechanism exists that allows developers to easily create quasi-governmental authorities to finance far-reaching utility extensions. Meanwhile, it’s always been cheaper for developers to build horizontally than vertically, and because Houston faces few physical impediments such as rivers, lakes or mountains—save for the Gulf of Mexico 50 miles to the southeast—there isn’t any physical reason stopping them. “That’s one of the reasons you don’t have a massive number of high-rises,” says Ric Campo, CEO of the national real estate firm Camden Property Trust, based in Houston. “It’s all about land availability and cost, and it costs a whole lot more to go up than out.”

 

 

What is changing is Houstonians’ attitude toward urban life. Historically, as Rice University’s Kinder Institute for Urban Research succinctly puts it, Houston has been viewed as "the most sprawling, least dense, most automobile-dependent major city in America." And for many years, Houstonians seemed to be perfectly content with that. But there’s evidence that’s no longer the case. The institute’s annual survey of Houston-area residents last year found that half the residents of Harris County, of which Houston is part, would prefer to live "in an area with a mix of development, including homes, shops and restaurants" as opposed to a “single-family residential area." Even if you look at the farthest parts of the metro region—the nine counties surrounding Harris County—more than 40 percent of residents prefer the mixed-use option. The results, which are also reflected in recent development patterns, have city leaders, developers and advocates for density buzzing. "It’s not a flash-in-the-pan trend," Campo says.

The trend seems to be driven by three factors: young adults who are less attracted to suburbs, rising transportation costs, and a concerted effort by Mayor Annise Parker and her predecessor Bill White to promote amenities in the city and especially its core. Houston, of course, is by no means the only city experiencing a renewed interest in urban living. But it may be the most unlikely, and the trend is especially notable given the poor reputation Houston has historically had in the urban planning field. Now, city leaders are trying to respond to market demands they didn’t encounter just a short time ago. As the Kinder study notes, "the challenge today is not in finding residents who want to live in more compact, urbanized communities, but in building places across the region that can accommodate them."

http://www.governing.com/topics/urban/gov-houston-urban-revival.html

 

The real question. Wesley College, a urban housing development. I spent 5 long years there, it's been at that location since 1924 and in existence since 1844. Is it now going to be rubble?

Contrary to advice to NZ Government, it the rest of the world immigration puts up house prices.

.........

Recent evidence from country studies on house prices suggests that the im-

pact of immigration on local house prices is a global phenomenon. Saiz (2007)

estimates that an immigrant inflow equal to 1% of a city’s population results

in a 2% increase in house prices for U.S. cities. Gonzalez and Ortega (2009)

show that the price effect through immigration is higher for the Spanish

housing market. Akbari and Aydede (2009) instead find muted immigration

effects for the Canadian housing market. Stillman and Mare (2008) uncover

a separation result between migrant groups. They find that the inflows of

returning New Zealanders are related to rising house prices but that inflows

of new foreign immigrants are not.

A striking feature of these spatial correlations - the correlation between

house prices and immigration across local markets - is that they coincide with

episodes of high house price inflation and pronounced immigration flows at

the national level. Gonzalez and Ortega (2009), for example, consider a boom

episode where Spanish house prices grew annually by 17.5% and the foreign-

born share in the working population increased from 2 to 16% between 1998

and 2008. Similarly, Saiz (2007) examines a 15-year episode where prices for

new single-family homes grew annually by 6.3% and the 10 largest American

immigrant cities recorded levels of new legal immigration of 13% of the initial

population.

Conclusion

We find that an increase in immigrant flows equal to 1% of the total popu-

lation in each district is coincident with a 2.7% price increase in Swiss house

prices for single-family homes. The short-run estimates for an environment

of low house price inflation are consistent with international evidence found

for episodes with higher house price inflation. The results show that rent

control and low home ownership rates, distinct features of the Swiss housing

market, do not mitigate the house price effect associated with immigration.

Swiss National Bank Working Papers

Immigration and Swiss House Prices

Kathrin Degen and Andreas M. Fischer

Damn selfish of those Kiwis to sit in their leafy suburbs on valuable land. What do they think this is New Zealand?

Ceri Thomas, the acting deputy director of BBC News and former Today editor, was more measured when asked about the BBC's coverage. He told the review: "Any culture can be at risk of excluding what it thinks is wrong, possibly marginalising significant chunks of public opinion. We need to push against this consensus every day."

In the report, the trust urged the BBC to urged to avoid an "over-reliance on Westminster voices" after concluding that national politicians "tend to dominate" the views seen and heard on BBC programmes.

"It is also clear that the BBC cannot afford to rest on its laurels and it should ensure it does all it can to keep up with the ebb and flow of public opinion," said Prebble. "Which means avoiding over-reliance on Westminster voices, making efforts to find new voices even if they are contentious, and challenging their own assumptions on the accepted consensus."

Prebble warned of the dangers of the BBC gathering too many of its journalists in its new Broadcasting House headquarters in London's West End, saying: "A large group of people working together are in danger of becoming more homogenous in their thinking, not less, and so less able to see when the output reflects a narrow outlook."

A BBC spokeswoman said: "We are pleased our coverage has been deemed 'remarkable' and 'impressive'.

"Stuart Prebble has concluded, overall, that our coverage of immigration is 'broad and impressive', that on the EU we offer 'a wide and comprehensive range of information and viewpoints' and that the BBC's coverage of religion is 'comprehensive and impressive'. He also states that the overwhelming number of journalists within the BBC leave their personal politics at home.

"However, the report provides some interesting insights. We agree it is always vital to guard against unconscious bias or 'group think' and will continue to do so and we've committed to a number of actions to improve our coverage even further."

http://www.theguardian.com/media/2013/jul/03/bbc-deep-liberal-bias-immigration

Radio NZ stays way clear of any immigration debate unless it is a no contest issue.

One of the problems that needs to be got out of the way is that urban planners are using crude computer models that are nonsense and give the opposite outcomes to the real world.

Prof. Alex Anas of the State University of New York at Buffalo, and his colleagues, are well advanced in critiquing the deficiencies of the commonly used computer models and suggesting why real life outcomes are different.

Conclusions from “Discovering the Efficiency of Urban Sprawl”, Alex Anas, 2011

“The data on the largest U.S. MSAs show that commute times increase only slightly with city size: the elasticity of the average commute time with respect to the number of workers was about 0.1 in 1990 and 2000. Our CGE simulations of Chicago explain this by showing that with jobs and population sprawling to the suburbs, the average road distance between home and job and home and shop can become shortened as congestion increases on the average mile, so that travel time per consumer remains stable. These results suggest that urban sprawl itself has not been the cause of significant travel cost increases.

Meanwhile, theoretical models of urban areas with polycentric and dispersed employment show that more sprawl, not less, is often needed to offset the negative externality of unpriced congestion and improve efficiency. Planners, like urban economists devoted to the monocentric model, have long viewed sprawl as something that should be reduced. Such a bias leads to potentially drastic planning and policy remedies of which the restrictive urban growth boundary is the prime and most costly example. A higher level of sprawl and polycentric land use may indeed be optimal. To the extent that T.O.D. and the New Urbanism are perceived as antisprawl tools, they may be wrongly promoted. But these tools of modern planning have an important role to play in serving niche markets. Planners may do better to view them as mechanisms that will promote efficient polycentric land uses.”

William Wheaton, the economist who designed the first computer model of the urban economy back in the 1970's, virtually repudiated every result it would have given meanwhile, in a 2002 paper with the self explanatory title, "Commuting, Ricardian Rent, and Housing Prices in Cities with Dispersed Employment and Mixed Land Use". His conclusions in 2002 were that cities, left to themselves, will evolve an increasingly efficient spatial balance of housing and dispersed jobs, with stable or reducing commute times, and economic land rent falling, with the urban land rent curve becoming progressively flatter and fewer and fewer locations commanding significant price premiums. This matches the real life outcomes of cities like Houston.

There are also advantages for businesses and opportunity for startups and increased opportunity for the formation of new clusters. This leads to greater agglomeration economies. Planners stupidly think they can increase agglomeration economies by constraining urban growth, which is actually the opposite of the evidence. The McKinsey Institute in a 1998 Report said that nothing like Silicon Valley could ever evolve in the UK due to its urban planning system; and the Barker Inquiry of 2007 noted planners lamenting that "clusters" they had "planned" did not eventuate because the owners of land they had zoned for the purpose were being greedy and holding out for too high prices. DUH...!!!

Silicon Valley evolved on low cost rural exurban land that at the time, there was no prohibition on using for non-rural uses.

Yeehaw let's turn Noo Zealand into a flyover state. Loving your vision fellas let's clean out the commies in govt and build ourselves a little old gas guzzlin', raccoon shootin', cousin humping paradise.

On TV last night it ws stated that Auckland needs to build 13,000 new houses per year just to keep up with demand and it is currently building only a bit over 3,000.  This means that the 39,000 extra (if they can build them) over three years will only just result in a 9,000 reduction of the present  30,000 shortfall.  We still have problems and what is the plan after they have built the 39,000; they can't stop there and must continue at this rate of 16,000/year for another 6 years to get close to meeting the demand backlog.  Thereafter they can drop back to something over 13,000 per year

Is Auckland too big? How can we make it shrink? Re-zone existing areas of lower cost housing on the fringes as rural use only. Build tower blocks in Remuera to re house the displaced. Introduce a special Auckland tax on Auckland land only. Increase resource consent fees and have mandatory consultation periods for all new developments.

Let me see now, this line of thought could be fun. Just in case it is not clear in the written form, I am attempting to be satirical.

Foreign buyers snapping up AU residential property

Foreign buying of residential property moved sharply higher in NSW over the past three months

From the horses mouth

NAB group chief economist Alan Oster said, with the real estate market worth about $4 trillion, foreign buyers are unlikely to be influencing median house prices. But no one really knows because a lot of foreigners do not need Australian banks and the only way that we can get data is to ask the experts in the market what they think it is.

The foreign buyer data is contained in NAB's Quarterly Australian Residential Property Survey for the three months to the end of September. It is not based on official data, but on the opinions of a panel of more than 300 real estate experts.

They're guessing.

They know it's happening, but they don't know to what extent, or the net effect

foreign-buyers-snap-up-residential-property