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More land needed to support job-rich development

Media Statement
29 August 2006

More land needed to support job-rich commercial property development

Calls by the Mayors of Manukau and Waitakere for more land to be freed up for development, as reported in the New Zealand Herald (29 August 2006) are right on the mark according to the Property Council of New Zealand.

Connal Townsend, National Director of the Property Council said the Metropolitan Urban Limit (MUL), which defines the limit to the development of land in the Auckland region, is inflating the price of land to unaffordable levels.

“The economic future of Auckland is in jeopardy. The region’s eight local authorities have created the metropolitan urban limit around the perimeter of the Auckland region, which restricts people’s ability to build homes, factories and businesses. Restricting the availability of land is driving up land price, which in turn is driving up the cost of residential and commercial property development.

“If more land is not made available the region’s eight local authorities will effectively create a situation whereby businesses and new home owners can no longer afford to live and do business in Auckland. This will starve the Auckland region of the jobs, workers and the productivity needed to create future economic growth and wealth,” Connal Townsend said.

The Property Council has lodged a submission opposing the Auckland Regional Council’s proposed Plan Change 6. The plan change opposed by the Property Council seeks to confirm the ‘containment’ policy designed to stop growth and land development at the perimeter of the Auckland region. The Property Council is instead seeking to extend the MUL and release land in order to alleviate land price-inflation.

“The Property Council’s Urban Strategy and Infrastructure Policy calls for local authorities to support the rejuvenation and investment in existing communities. But intensification alone without some expansion at the periphery of regional Auckland is doomed to failure because insufficient ‘brownfields’ land is available to be redeveloped. You cannot have one without the other.

“The 2006 Demographia international affordability survey illustrates how the Auckland region is now one of the most ‘severely unaffordable’ cities in the world. This situation is largely the responsibility of the regional growth strategy, which is significantly contributing to land-price inflation.

“It is also important to note that land-price inflation is also contributing to higher rates demands. As the supply of land falls, the value of existing land increases. This in turn increases the rateable value of each property, thus providing the region’s eight territorial authorities with a cash windfall. In other words land containment is destroying jobs, economic growth and productivity … and it is making local authorities rich,” Connal Townsend said.

ENDS

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