Restricting development contributions will help housing
15 August 2013
Restricting development contributions will help achieve affordable housing
Restrictions on development contributions will help achieve more affordable housing and commercial development, says BusinessNZ.
A Local Government Reform Bill to be introduced to Parliament this year will reduce the development charges that councils can put on new sections.
Councils are allowed to levy fees on developers, which now average $14,000 per section but can be much higher.
BusinessNZ Chief Executive Phil O’Reilly says development contributions are part of the upward pressure on building costs and it is appropriate that boundaries are placed around their use.
“It’s important to avoid the use of development contributions as a simple revenue generator for councils, unrelated to development costs. Stricter criteria are needed on the use of development contributions, including appeal rights against excessive charges.
“This will not be a silver bullet for affordable housing, but it can be part of the solution.”
Mr O’Reilly said it would also contribute to the Government’s goal of improving the quality of regulation overall.