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Focus on Restoring Housing Affordability

Quit Nitpicking Over the Housing Bill … Focus on Restoring Housing Affordability …

… David Hargreaves of Interest Co NZ opines on Interest Co NZ … TOO MUCH CENTRAL CONTROL WITH HOUSING ACCORD BILL …


Hugh Pavletich comment (on thread above) …

As Deputy Prime Minister Bill English has made clear, Central Government must have the reserve powers to step in, if Local Government fails to meet its responsibilities, in allowing affordable housing to be built.

One could not accuse Local Governments of showing much initiative on these issues over recent years. Bear in mind the NZ Planning Institute came on board with the Demographia Surveys February 2007 - refer top left column www.PerformanceUrbanPlanning.org to access its Press Release at the time !

The other professional bodies and industry bodies have been just as useless to date. It’s well past time they all lifted their game and got in and worked constructively with the Government.

"Working constructively" obviously needs to be spelt out for these people. It is learning how to supply new starter housing on the fringes for around the $1,000 per square metre mark ALL UP. This will take some considerable time, as the damage of past decades is unwound.

The situation now is intolerable ... something even the Labour Opposition recognises in supporting the Bill through its first Reading. And hearteningly too, Local Government New Zealand. LGNZ had fought the intent of the RMA since its inception way back in 1991. They have obviously woken up.

One of the major problems is that politicians across the spectrum have failed to date in spelling out what affordable housing is. These issues are discussed extensively at www.facebook.com/CantabriansUnite .

Remarkably to date, there have been two serious research omissions ...

First ... quantifying the artificial scarcity values on the fringes of our metros above True Rural Value. We know these are approximately $500,000 per hectare on the fringes of tiny Rolleston; about a million bucks on the fringes of Christchurch and near two million dollars per hectare on the fringes of Auckland.

There is simply no way these artificial zoning scarcity values can be justified.

Second ... following 9 Annual Demographia Surveys, there has STILL been no research carried out lining up the detailed costs of our fringe housing development / construction with the affordable markets of North America.

We know in New Zealand dollars it costs ALL UP about $800 per square metre on the fringes of Houston ... about $2,500 + ALL UP on the fringes of Christchurch and $3,500 + ALL UP on the fringes of Auckland.

For reasons only known to themselves, the Productivity Commission and others went down the wrong track comparing our residential development / construction costs with "severely unaffordable" Australia.

The costs of abnormal and unaffordable markets are of no use whatsoever.

No doubt this Housing Bill has its imperfections. These can be sorted out through the Select Committee process. But getting in to sort out bubble land values and inappropriate infrastructure financing arrangements are far more important.

This Bill is expected to be the first of an on-going rollout of initiatives, sorting out artificial zonal scarcity problems, inappropriate infrastructure financing and importantly too, inculcating sound measures and disciplines in to local plans.

The Law has its limitations though. You could nail the Ten Commandments to the wall of a whorehouse, but it doesnt mean they will all start behaving themselves (the RMA is a glaring example of this)!

More important are factors such as culture and attitude, in that we all work together to restore (not invent) affordable housing to this country.

The Labour Party has shown the way in supporting the Government with the first reading of the Bill and Local Government New Zealand too, in coming out publicly supporting the Government.

It must not be forgotten this issue got political traction in New Zealand, when the NZ Planning Institute under the leadership of Professor Michael Gunder and its CE Keith Hall, supported the Demographia Surveys www.demographia.com early 2007. I am most grateful for Michael and Keith's support during the early years of this long journey.

Hugh Pavletich


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