The Property Council blasts Auckland's NIMBYs, backs high rise development

The Property Council blasts Auckland's NIMBYs, backs high rise development

The Property Council has taken a swipe at Auckland NIMBY (not in my back yard) groups opposed to more intensive residential development in their neighbourhoods.

In a statement released today, the Property Council, which represents property investors, said it was concerned that some community groups were standing against the intensification of residential development in numerous areas of Auckland.

It said the city's population was projected to grow to nearly two million people by 2031 and housing them had to be taken seriously.

Community groups needed to to think more broadly, rather than merely protecting their own interests and established suburbs from change, it said.

"Auckland needs to be able to attract skilled workers and entrepreneurs by offering them viable lifestyle choices, if it was to retain its economic vibrancy," Property Council chief executive Connal Townsend said.

"Pushing people out on to rural boundaries away from commercial centres in the name of avoiding high rises is not rational," he said.

"With those people, jobs and economic activity go as well, taking vibrancy and desirability."

Auckland's Proposed Unitary Plan must not be too onerous, and should avoid policies and provisions that would make development a more expensive and riskier business, he said.

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"Pushing people out on to rural boundaries away from commercial centres in the name of avoiding high rises is not rational,"
Did you hear that Hugh P?

Auckland is over populated and sitting on a time bomb, like the Neapolitans, we have our heads buried in the volcanic ash!
Densification in the heart of the volcanic field is just dense.
Spread out and lower the impact of the inevitable eruption which will likely wipe out suburbs and  potentially make Auckland uninhabitable for some time.

A couple of serious shakes, followed by colossal increases in insurance premiums, will fix that

.... very obviously , you have not encountered many Aucklanders in your wonderful life ...
If you had , you'd be keeping mum about the fact they're sitting atop 29 potential volcanoes ...
.... " sleeping dogs " old buddy ... leave 'em be ...

Do the Councillors of the Property Council live in high rises in GI with no car parks??
Karaka mansion  and helicopter more likely!!

That piece reads a lot like 'we want to make more money and you won't let us'. 
I am sure the owners of the houses in question have very good reasons to oppose the high rises, they may not even agree that 2m people in Auckland is a good idea even.

Agree with Craig. Article is a bit compaining. If you have brought up soon to be rezoned hi density land, and then run into the RMA tough luck. Expect a holding period while the new plan comes on line, and developments get bashed up through lawyers. Its call RISK for a reason.
That said, Auckland has to grow upwards as well as outwards. If your selling - win!, If the appartment tower is next to your inner city villa, then either no more nude sunbathing in the back yard, or no more  winter sun depending on where it is built in relation to you.

Just to generalize a little bit, Aucklanders would be a good approximation for the rank and file of the flat earth society members. Their view really is limited to the boundaries and resistance to outside ideas is very prevalent.
My hope is that as improved data services translate into more decentralised business, that CBD's can no longer command the higher rental and the land hoarders there see their capital diluted. The flow on may be that city suburbs become considered crowded and less desirable places to live.
Having lived and worked throughout NZ, including Auckland, a great many places are more attractive to me for many, many reasons. The Jafa's are welcome to their bubble.

Auckland needs that level of  intensity to be creative, innovative and a safe nest for productive companies, trust me on that.

Running, jumping, standing still
Why advocate something that hasn't worked, doesnt work, and won't work
10 years of absorption of increased population due in large part increased migration, annual GDP has merely increased at a rate commensurate with the increase in population, while Per Capita GDP has not increased, (zero benefit to the incumbents) while at the same time the quality of life has diminished (for the incumbents) as more and more people share the same limited land area, infrastructure and services. Talking about Auckland, you can only squeeze so much into a proscribed area. It's past that break-point now.
What's the point ??

"Trust me on that" ???
We should never trust anyone on 'life affecting' decisions.
Trust no one and don't be disappointed.

Funny that we trust politicians by voting them in

Auckland needs that level of  intensity to be creative, innovative and a safe nest for productive companies, trust me on that.
Can you point to the number of high value export industries Auckland is producing (other than building and construction)?
According to the Drivers of Economic
Growth in Auckland
A report prepared for the Royal Commission on Auckland Governance:
There is robust evidence to support the view that larger city/regions are more productive
than smaller ones. In addition to international evidence, several local reports have
recently identified these agglomeration benefits. In our view, the best of these reports
was written by Motu researchers. It found evidence that “localisation” increases
productivity but that “urbanisation” decreases it. Localisation refers to physical clustering
by similar firms, whereas urbanisation is defined as the co-location of diverse firms. This
is an internationally unusual result, and may suggest that greater attention to clustering is
warranted in Auckland.
Given that agglomeration economies appear to exist in Auckland, the size of the resulting
benefits is of interest. There is a wide range of size estimates internationally, with most
suggesting that doubling the size of a city will increase productivity by between 3% and
Any productivity boost would help Auckland firms compete more effectively against those
in other locations. However, considering the official projection of population growth in
Auckland (43% over the next 24 years), even elasticities at the top end of the international
range would result in (agglomeration-sourced) productivity gains of only 3% in total,
spread over the next two decades.

Moreover, agglomeration also brings added costs. Large cities also contain forces that
drive people away, and there is some Auckland evidence of such an effect for older
working age people in our report on the composition and scale of Auckland’s economy.
The literature identifies land constraints as a key source of forces pushing people away
from cities, and show up in land rents, the cost of commuting, and congestion. The
resulting trade-off between the costs and benefits of greater population densities is an
issue for regional government, impacting primarily on land-use and transport policy.
These are matters on which some policy coordination is clearly warranted.
In summary, based on the available evidence, it seems clear that modest agglomeration
economies will accrue gradually in Auckland, but they will not be a causative force that
will transform the regional economy. Moreover, a larger and more dense population on
which they rely also imposes costs, notably in the land markets

Why not let the market determine the viability of multi storey development by putting a price on  it?
My suggestion would be for the owner to pay every neighbour including the local body a dollar amount based on common boundary shared multiplied by the number of storeys  requested.
Wonderful windfall for the adjacent owner unless they also wanted to develop later when they would pay a similar  amount to the then owner or owners.
Payment to the Council could be in place of development contributions.

It would also incentivise the developer to purchase the adjacent land and aggregate rather than pay up.
Example would be $5000 x 50 m x 4 storeys =  $1m
Money machine !

The Property Council says: the city's population was projected to grow to nearly two million people by 2031 and housing them had to be taken seriously.
because of intensive lobbying ( by the Property Council)  for more immigration even though 20 years of high immigration hasn't done us any good.

Roughly 2/3 of the growth in last 10 years is from natural increase. Stopping all imigration won't stop growth.

Population growth is government policy. It has been to more than replace departing New Zealanders with migrants.
Michael Reddell (Reserve Bank) argues that departing NZr's  (to Australia) act as a safelty valve on the economy encouraging employers to become more efficient or pay hihgher wages.
He also notes that 80% of population growth over the last 20 years has been non NZ citizens (when you take out NZr's who have a right to return). He points out that all the infrastructure required for a larger population must come from taxation from our low wage economy and this has forced up interest rates and the exchange rate crowding out business investment in productivity (and incomes).

That's interesting, this figure doesn't relate to data at I suspect Mr Reddell has made a cockup (hard as it is to imagine). The graph is same as SNZ data, but I think should read migration as a '% of natural increase' as opposed to '% of total population growth':
In the peak year SNZ example (2003) there's 43,000 migrants versus around 30,000 natural increase which means migration is around 140% (matching the Treasury graph - so presumably we're using same figures). BUT once you average these figures to 80% it doesn't mean 80% of our population growth has been migrants. That would mean 80 migrants and 20 natural increase for every 100 person increase, but actual figures stated is 80 migrants for 100 natural increase.
The 80 is out of 180 not 100 so actual figure would be 44% - very different to 80%.

Another way to look at it - Mr Reddell's 2003 peak is150% of total population growth. So he's saying in 2003 immigrants were 150% of total population growth. Therefore if total population growth was 100 people 150 of these were immigrants - kind of impossible no?
His graph can't go above 100%.

No bob, not impossible, in fact, mathematically very possible.

I understand that if more kiwis leave than there's natural increase then number of immigrants will be greater than 100% of total population growth. But the way these statistics are presented makes it look like there's very little natural population growth which is not the case.  

You are changing the rules
Your first post referred to Migrants (meaning inbound migrants)
In your second post you changed it to net-migration (arrivals - departures)
In the case of your first post, if you take into account departures it is possible for population-growth to be negligible or even negative, while inbound migrants to be positive. In other words if departures are equal to or exceed arrivals you can get to infinity

"And 80% of our population growth in the last couple of decades has been the net
inflow of non NZ citizens - thus almost purely a matter of discretionary policy
total population increase =  Births - deaths + net migration.
Net migration = (net migration NZ citizens - net migration Non NZ citizens). He does this because immigration by non NZ citizens is discretionary government policy.
"Government policy interventions can act to stymie successful adjustment -
and I believe this to have been the case in NZ over the last two decades. Our negative
NIIP position is larger, our real exchange rate is higher, our real interest rates are
higher, and our capital stock per worker (and associated perceived business
opportunities) are lower than they would have been if we had simply let the selfstabilising
behavior take its course. As John McDermott’s slides showed earlier, that
adjustment was working prior to the mid 1980s."

According to Stats NZ link above "... New Zealand has never experienced a natural decrease." As you state total population growth = natural increase + net migration. Given that natural increase has always been positive how is it mathimatically possible that net migration can be 50% more than total population growth?

Figure 17 tells the story. The net outflow of New Zealand citizens fluctuates (with the New Zealand and foreign business cycle) but has been negative for several decades. The average annual outflow - around 0.6 per cent of the population over the last decade - is large by international standards. But it is now typically more than offset by the increasing number of net arrivals of non NZ citizens: from around 10000 in the period prior to the reforms, to something closer to 40000 per annum now. The difference makes a material macroeconomic difference; on average, for example, equivalent to around half New Zealand’s house-building in a normal year. As a share of population, the average net intake of non-New Zealanders is one of the largest anywhere; directly as a matter of policy choice. The net inflow of non New Zealand citizens has accounted for around 80 per cent of average population growth over the last two decades.

Page 33
The long-term level “misalignment” of the exchange rate:
Some perspectives on causes and consequences
Paper prepared for the Reserve Bank/Treasury exchange rate forum
26 March 2013
Final version: 19 April 2013
Michael Reddell1  


Given that the goal of immigration has been to generate economic growth, it is interesting to
compare the economic performance of Auckland to the rest of the country. Figures from the
Ministry of Economic Development (2005) on Auckland’s economic performance are not
impressive and do not reveal any benefits from the migration flows. Between 2000 and 2004,
the nation’s average real GDP growth was 3.5% but Auckland only enjoyed 3%. Auckland’s
GDP per capita was $30,750 in the year to March 2003 compared to a national figure of
$32,100. Auckland has 32.2% of the nation’s population, but only 30.9% of nominal GDP
and 30.3% of the labour force, indicating higher dependency ratios. Although Auckland is
the largest region, it is only the fourth ranked location for foreign investment. Figures from
NZIER(2006) are more positive, no doubt buoyed by the infrastructural expenditure
mentioned in the last section of this paper. These figures provide an average growth of Real
GDP of 3.6% between 2000 and 2005, slightly above the national average of 3.6 but much
below that of other main centres (Canterbury 4.5 and Wellington 4.3). Nevertheless, there
appears to be a broad consensus that Auckland is not achieving desired rates of per capita
income growth (Skilling 2006, Auckland Regional Council 2005).
Dr Greg Clydesdale

Pains: The valuation and cost of human capital

That is correct
GDP is growing at a rate commensurate with population growth, as it should.
However on a GDP Per Capita basis, it is not growing at all, which demonstrates that immigration is not bringing with it the supposed benefits to the country or the incumbents.
What's the point of it all?. The central planning boffins need to change their tune

This is interesting (Toronto):
Yet as Figure 2 clearly indicates, household growth was sustained through
immigration, which accounted for 78 percent of net population growth from 1986
through 1991 and 93 percent from 1991 to 1996 (Bourne 1998). Immigration gains of
about 70,000 a year over this decade were not far behind those of New York in the 1980s
(Waldinger 1996). These trends steadily match the climbing price gradient from 1986 to
1989, but continued at high levels while the housing market crumbled during the deep
recession of 1990-92, with GDP stagnant in 1990 and 1991, while unemployment
exceeded 11 percent in 1992. Why should immigration continue to rise during a
recession? Several factors seem to have been at work. First, and most important, the
federal government abandoned its policy of regulating immigration according to the state
of the economic cycle; high entry levels were declared for a five-year period regardless of
the condition of the national economy. Consequently high entry targets were sustained
during recession. Second, the movement of immigrants is only imperfectly related to
local economic conditions at the destination as American researchers have noted
(Waldinger 1996; Frey 1996). Economic migrants have a medium- to long-term horizon
and are prepared to wait out immediate economic downturns, while refugees – and
Toronto is by far the major refugee destination in Canada – were arriving in response to
immediate circumstances in regions such as Somalia, Sri Lanka, Eastern Europe and
Central America where civil war made survival a primary motive for movement. The
result is that while immigration was the principal new demand impulse during this period,
it shows only a low positive correlation against price changes in the housing market. The
data support the inference, however, that without the very high level of housing demand
sustained by immigrants in the early 1990s, the collapse of Toronto prices would have
been much exaggerated, perhaps precipitous. This is of course why the development
industry in Toronto and Vancouver (Ley 1995, Mitchell 1996) has lobbied so hard for
sustained high immigration levels.

The Kiwi (Once Was) lifestyle isn't just about a house and Garden. It was about a House and Garden close to the Town Center.
O.K so suppose we switch to lovely apartments. It is unlikely to be win:win. The reality is that a zoning change is a windfall to investors and a loss to those who loose sunlight and ambience.
Of course when the young people have children we have to build for them, but this isn't about  natural population increase it is about immigration policy based on dubious economic and social grounds.

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