By Timothy Welch*
By withdrawing its support for the Medium Density Residential Standards (MDRS) it helped introduce in the first place, the National Party has essentially only made a soft policy even softer.
Lauded by many as progress towards increasing urban housing supply and density, the MDRS allows land owners to develop up to three housing units, three storeys high, on most urban lots without seeking consent.
The standards and the law behind them stipulate no requirements for higher housing densities, nor do they apply additional restrictions on any other form of building. It was always unlikely the MDRS would contribute significantly to housing supply or density.
That’s because while the law enables more housing units, it does not fundamentally change how land is developed. Considering this already light approach, National’s change of heart will likely push future development even further into undeveloped “greenfield” land.
National has unveiled its election-year policy to help solve the country's housing shortage, which includes backing away from parts of its bipartisan agreement with Labour https://t.co/RE9qan66bP
— Q+A (@NZQandA) May 27, 2023
Encouraging urban sprawl
Undeveloped or very lightly developed land surrounding cities, greenfields are typically agricultural. But they can also include wetlands, forests, floodplains or any other location not yet swallowed up by urban expansion.
Developing low-density residential and commercial units on greenfields creates what is known as sprawl – something of an obscenity in urban planning circles.
Characterised by single-family, car-dominated suburbs, these developments may provide affordable housing for those willing to drive longer to work, school or shopping. But they are also extremely costly for cities and ratepayers.
Sprawling suburbs require a lot of new infrastructure: roads, sewers, freshwater and stormwater pipes, power and broadband connections – and sometimes new schools, police and fire stations, and other social services. All this costs a lot.
This infrastructure is already well developed within the city, and often has extra capacity. Where there is an infrastructure deficit, such as in some parts of Auckland, the costs and benefits of adding and renewing infrastructure is spread across a large population.
Adding more users to existing infrastructure only reduces service and maintenance costs (providing it is sufficient, of course). A 200-unit apartment complex, for example, spreads the cost of all this infrastructure over many users and is unlikely to affect rates.
When the same infrastructure is used to service single-family units spaced half a hectare or more apart, the cost per user is exponentially higher. In many cases, it is subsidised by urban ratepayers while the infrastructure investment benefits only a few households.
The government’s recent budget committed billions of dollars to repair and strengthen existing road and rail networks. So it makes little sense to encourage development in places that will need even more potentially vulnerable infrastructure.
Urban sprawl, traffic crawls: public transport becomes difficult and private car use increases. Getty Images.
Increasing carbon emissions
Sprawl also makes public transport inefficient or entirely impossible. In a dense urban environment, a single train or bus stop can service hundreds or thousands of potential riders. Again, the cost per rider is much lower than in sprawling, remote suburbs.
The same can be said about active transport modes. The cul-de-sac development style that characterises many modern suburbs can make it challenging to walk or cycle anywhere.
Embracing greenfield development means we are making a conscious decision that future generations must rely on cars as a primary mode of transport.
Cars are a major source of carbon emissions in cities. In Auckland, vehicle emissions account for up to 35% of emissions. Pushing more housing out to the edges of the city means households will need more cars to drive longer distances more frequently.
Sprawl means locking ourselves into increased carbon emissions when the Zero Carbon Act has committed New Zealand to reduce emissions by 30% below 2005 levels by 2030, and make the country carbon neutral by 2050.
New Zealand’s largest city has committed to reduce transport emissions by 64% by 2030, primarily by shifting to public and active transport modes. None of this is possible if it continues to grow outward rather than upward.
The medium density standards aren’t perfect. They’re probably not even very useful as a tool to grow the housing supply. But they are better than encouraging continued outward urban expansion.
The missing middle: townhouses and apartments are the future of urban housing development. Getty Images.
Urban growth boundaries
What is missing from the MRDS, and especially from sprawling greenfield development, is true medium-density housing. Outside New Zealand, this “missing middle” in the urban equation is characterised by townhouses, row houses, and three- to five-storey apartment buildings.
This type of development is critical to providing a more plentiful and affordable housing supply in places with good existing infrastructure serviced by public transport and active mode connections.
Worldwide, cities are rapidly working towards creating more density and housing supply within existing urban areas. For decades, cities like Melbourne, Portland, Vancouver, Copenhagen and even Beijing have applied urban growth boundaries to help preserve undeveloped lands.
In the US, where sprawl has long dominated urban growth, cities have worked to increase density and housing supply by removing zoning requirements for single-family housing.
All in all, the MRDS could go much further. But throwing the baby out with the bathwater isn’t the answer. Greenfield development is more costly for everyone, while burdening future generations with car dependence and excess infrastructure.
*Timothy Welch, Senior Lecturer in Urban Planning, University of Auckland. This article is republished from The Conversation under a Creative Commons license. Read the original article. You can find a visualisation of New Zealand "urban sprawl" here.
98 Comments
The author makes a fairly common flawed assumption on the MDRS and hence their impact. He assumes it’s only about 3 x 3 storey houses on one section. It’s not.
That’s what is permitted (doesn’t need resource consent)
The much bigger impact is the widespread enabling of three storey development for more than 3 dwellings, in so many more locations (albeit requiring resource consent)
This means that on standard 600 square metre suburban sections, 6 or 7 houses are possible rather than 4 or 5. The extra yield of two houses makes a big difference in terms of development feasibility.
If it continues to proceed it would likely realise quite a lot of new housing.
The much bigger impact is the widespread enabling of three storey development for more than 3 dwellings, in so many more locations (albeit requiring resource consent)
I'm not quite following this comment. My understanding of the MDRS is that unless an area/property is located within a qualifying matter precinct - then all other residentially zoned property has the benefit of the not needing resource consent for up to 3x3, but otherwise existing district plan rules remain the same.
So, I'm not sure how it is that the MDRS changes density rules other than as above. Are you suggesting that presently (and I'm assuming you mean in the Auckland Plan) 6 or 7 houses on the 600m2 property are a prohibited activity, and with the introduction of the MDRS that would no longer be the case?
Ah so this shows it really is misunderstood!
Qualifying matters negate application of MDRS and upzoning.
But where qualifying matters are not applied, rezoning to enable three storey development is effectively mandated. This is because the MDRS includes mandatory objectives and policies promoting 3 storey development.
So in Auckland the biggest impact is the widespread rezoning of Mixed Housing Suburban (2 storeys) to Mixed Housing Urban (3 storeys). Where this rezoning occurs (assuming it does), 3 dwellings of three storeys is permitted (no resource consent needed). 4 or more dwellings needs resource consent, but critically the anticipated and permitted development scale is three storeys rather than two storeys.
This makes a big difference to development feasibility. And it’s why many developers are pissed off about National’s flip flop.
I know a number who own currently MHS zoned land. Redevelopment only stacks up if the land is zoned MHU and they can go to 3 storeys. Plan change 78 is promoting such widespread rezoning, as per the MDRS. Developers are looking forward to these increased development rights.
Now, National aren’t proposing scrapping the MDRS, but to allow councils to opt out. Most councils, including Auckland, are not happy with the MDRS and are likely to opt out if they can.
Ah so this shows it really is misunderstood!
LOL, yes, when a planner can't 'get it' that says something! In my defense, I'm not familiar with the Auckland Plan - but now I get your point about all the MHS folks looking forward to being automatically 'up-zoned' to MHU as a result of the MDRS.
So, got that now. But I still don't get your reference to the 600m2 section now being able (with RC) to go to 6-7 dwellings, and that this change arises from the MDRS? Wouldn't that option always have been an option (i.e., to seek RC beyond the rules permitted by the Auckland Plan)?
Yes possible but not necessarily easy or likely. Usually high risk. Risk is the developer’s enemy. Have been several appeals where the council’s decision to approve some three storey development in MHS has been overturned by the court. And understandably that makes council more risk averse.
MDRS and associated rezoning would massively de-risk.
The opposite is true.
Building in established areas is expensive and high risk. You only do it when the alternatives are banned by bureaucrats and politicians believing the nonsense written in this article. This is the best thing Luxon has done and if he sticks to his guns and makes sure a ton of land comes on stream asap - then there will be a building boom like no other in NZ's history as we catch up with decades of underbuilding at the fringes of the cities.
Its fantastic news and will hopefully end the ponzi scheme that is NZ housing which has been 100% caused by misguided urban containment policies.
Questions:
1. Who will pay for the infrastructure?
2. Where will it occur, once you take out land that has highly productive soils, is flood prone, is steep or is highly fragmented in terms of land ownership? These are all big barriers to greenfield development, and at least in Auckland I am struggling to think of any areas beyond those already earmarked for future development that avoid these issues. But I an always open to other views so maybe you could enlighten me
And then another issue is accessibility. One of the reasons that I think Te Kauwhata has been unsuccessful is its poor accessibility. Terrible in terms of Auckland, not great for Hamilton
1) the purchasers as they presently do. And allow developers to build it using MUD rules so it is cheaper and better.
2) Take out the land that is needed to be protected and then leave it to the market to decide. You might be surprised how much is still available.
I have worked for developers scanning the Auckland region. I think I have a pretty informed view.
All that you would get if you opened up Auckland’s hinterland would be crappy little ad hoc developments. Which would make little difference to housing supply and affordability.
I am still waiting for someone to point out where all this great land is. I never get an answer because….. it doesn’t exist.
But it sounds great in the abstract to waffle on about it.
so…. Can you or anyone else point me in the direction of this mystical land?….
I had this same discussion with Michael Reddell on his blog about where is all this vacant land in Wellington.
He suggested Ohariu Valley - check out the access road and that's a straight bit;
Wainuiomata - valley floor already fully zoned residential), and;
Whiteman's Valley - single lane each way hill access road - you'd need to build a Wainuiomata-sized hill road (i.e., two lanes each way, plus passing lanes) if you wanted to populate Whiteman's Valley in the same way as Wainui.
Not sure whether a MUD could finance that type of access upgrade, as well as the reticulated services that presently do not exist.
Okay, get it now. And thinking about it - I always felt the MDRS legislation was brought in specifically to address perceived failings of the Auckland Plan (and then it was imposed elsewhere to make it look less like targeting the over-rule of a single, specific plan).
On the face of it, a plan change/variation to the Auckland Plan that re-zoned all MHS to MHU would have been a much, much easier (and efficient!) way to go about this!
PS - a unrelated question for you - I always felt that protecting 'view shafts' in the Auckland Plan was ill-advised, unless of course - it was a matter that Aucklanders themselves were adamant they wanted to keep this protection. What are your thoughts on view shafts - do they impact on development opportunities a great deal?
I am a fan of the viewshafts, but I think there’s a handful of them which should be reconsidered.
For me, Auckland’s maunga are one of the city’s great, unique attributes. And that’s not just about climbing them, but the public views towards them.
They are also very significant to iwi. The views were very important way-finding aids, amongst other things.
I didn’t address the last part of your question. Yes they impact on development opportunities significantly. Many really good central locations, such as Newmarket and surrounds, can’t go beyond 5 storey apartments because of them.
Having said that, there are lots of areas not impacted much by them, especially for development of up to 3-4 storeys. 3 storeys is a bit of a development sweet spot.
If you wanted an optimal setting to enable heaps of mid to high rise apartments you would get rid of the viewshafts. But why stop there? Get rid of all planning controls.
But only if you don’t care about a whole lot of non-economic aspects of cities and environments.
A far better thing would be for the government to compulsorily acquire some of the many big, high density development sites in Auckland that are being land banked, usually by overseas interests.
Acquire them then sell off in packages to developers, with conditions on development actually occurring. And retain some and build social and affordable housing.
The Auckland Unitary Plan of 2016 has numerous failings. To pretend it doesn't, as Akl Council is, is a nonsense.
1. The MH Suburban zone was massively wasteful in that the houses built there would be being torn down before their lives were up to build bigger. The MDRS standards corrected this - kind of - as it is now all MH Urban (kind of).
2. The Terraced Housing & Apartment Building (THAB) Zone is a nonsense. You can't sensibly mix THs with ABs. TH's have significant ground level footprints for few dwelling whereas AB's (should) have small ground level footprints for more dwellings. And yet this is what we have. Further, both TH's and AB's need separate daylight and setback rules due to their distinctly different forms. From 2016 until now we've basically got lots of TH built but few ABs. Thankfully, the NPS-UD has forced a correction - kind of.
One can't criticise AC too much for the UP2016 mess. They did well to get it through given the (poorly informed?) fight NIMBYs put up and the 'mess' is mainly due to NIMBY pacification measures.
One final point - The way Auckland Council is responding to the MDRS & NPS-UD is to shoehorn them both into the existing (and nonsensical) zones. The result will be an even bigger mess. A rationalisation will have to be done soon after. So look forward to a new 2026 Unitary Plan.
Yes, my understanding too was that many planners were very disappointed with the protestations of the NIMBY crowd. Don't know the detail of it but there were a few good ideas dumped as a result;
Auckland Council passes up affordable housing action, again | Stuff.co.nz
Just an FYI ... I've seen at least one developer carve a section into two separate sections and then build two, 3 story blocks of 3 townhouses thereby getting around the costs and delays for a RC when more 4 or more are to be built. There are other examples of similar outcomes but I'm not sure that this was done.
Agree..and little thought ..or empathy is given to those who live next door. More often than not they are deprived of natural light and sun and their lives are very much impacted .So much for warmer homes and saving the planet by using less energy. I would imagine these people would have to burn through more fuel/electricity/energy to warm and light their homes.I'm wondering if any of our politicians who made the high density rules would enjoy having 3 story high rises slap bang next to their boundries/ homes?
I think not.
re ... The author makes a fairly common flawed assumption on the MDRS and hence their impact. He assumes it’s only about 3 x 3 storey houses on one section. It’s not.
HM, are we reading the same article? The author, Timothy Welch a senior lecturer in urban planning at University of Auckland who would know Akl unitary plan inside out, appears to me to be making no such assumption. In fact, quite the contrary. In the interests of keeping interest.co.nz free of those who 'do their own research' ... well, you know where the edit button is.
Academics are often very detached from real world professional practice. And even many practising planners have misinterpreted it. See Kate’s struggles with it!
I think he has misinterpreted it, as he only refers to the 3x3 opportunity when as I say it is much much bigger than that, and WOULD enable much more development (the author suggests it won’t enable or realise much housing supply).
Do you disagree? Do you agree with the author that the MDRS wouldn’t see much extra housing come on line? If so, why not?
Housing intensification absolutely everywhere without parking requirements f**ks up transport a lot more, no?
The problem with the new standards were that they invited chaos. Stupid idea to start with and I don't know why National signed off on them in the first place.
NZ's richest man started off running a tow-truck firm. (He towed me once.) Methinks he may see $$$ in going back to his roots.
London doesn't have this problem. Mind you, London is a grown up city. And they have the rules and enforcement so people (yours truly included) only do it once.
Public transport services are often poor in the far flung suburban locations across Auckland. And it’s completely impossible to provide high quality PT to every suburban location.
Walking and cycling won’t help much if you live in Howick and work in the city (for example)
Many developments provide only one parking space per dwelling, yet many households have at least 2 cars.
More cars per household is more likely in far flung suburban locations with poor accessibility and poor public transport.
Even where I live, in a terrace housing development near a train station, many households have 2-3 cars, and yes the streets are clogged, cars park on berms etc etc.
This is an argument for Council not providing ANY on-street parking for residents in the suburbs. Providing some means developers under provide and residents think they can rely on the council coming to help them out.
If council provided no on-street parking for residents, developers would think twice about not providing enough parking as it would be harder to sell. Residents would be less likely to rent/buy a house with less parking than they needed as it would be clear they couldn't rely on the council.
The other consequence would be that car share schemes would become more popular and viable as it does in other countries.
By continuing to provide on-street parking for residents council's create and actually aggravate the problem.
I've thought about this as well. The extra space freed-up from no on-street parking could be used for ride-share operators only. That way buses could do main routes only - and mini-van ride-share operators could do the suburban streets connecting with the main bus shelters/exchanges and the local/suburban shopping centres.
For those that want an example as to what was possible for medium-density under the old rules, 17 Lucerne in Remuera is a good example. Albeit a bit fancy. 1,000sqm now accommodates 8 houses on what was a single dwelling site.
https://www.davidreidhomes.co.nz/blog/medium-density-building-with-david-reid-homes
With increased construction and financing costs and reduced value, I would guess this would be incredibly uneconomic to develop in todays market.
$2.1m / 8 = $262k. Land could be nil and the feasibility wouldn’t work.
We are not going to make developments economic with changes to land values alone.
We have always been told he have high construction costs due to low volumes. Now with higher volumes these prices should come down, a lot.
Exactly. And it is why the land value argument is so flawed. When we are talking about medium and especially high density development (increasingly the norm in Auckland), construction costs and cost of finance are MUCH more important than land value.
After all land values were high 2-3 years ago yet development was going gangbusters. Why? Because construction costs were lower, and even more importantly cost of finance was much lower.
You will know the saying, 'if the land is wrong hen everything else will be wrong.'
It's true and our land use policies are wrong. This not only effects the price of land, but the cost to consent, time to development and thus the risk for finance etc.
It is explained in detail by the likes of Adam Smith, Alan Evans, Alain Bertaud and even in the NZ Productivity Commissions report into Housing.
Also in your argument re cost of high density land, you are over looking that while the raw land price per unit may decrease, the cost of construction for density increases even more the saving in land cost.
Our construction sector has a big productivity shortfall compared to sector wages.
Auckland's construction productivity measured in GDP per employee was only about 87k in 2022 (same as national average), despite high wages and business margins in the sector.
That's probably why it's so expensive to build anything and projects only ever become financially viable when there are huge margins to be made by developers.
Waste of space!
How about 14 dwellings of various sizes (including three 4-beds and six 3-beds and parking) in a 7-story apartment building on just 500sqm with a footprint of just 220sqm leaving the remainder, 280sqm, to gardens and landscaping. (My immediate neighbor's. I love it.)
Exactly right mate, builders only build what is going to sell. I suggested high rise apartments on here last week but was informed nobody wants to live in one. Love the picture here, cannot but help think of the fire risk you are going to need a comprehensive sprinkler system. If a fire starts and spreads in the wrong place your exit is completely cut off.
Or a 3 storey place that suddenly pops up next to that character villa in that suburb at a bargain basement price. People want the "Address" without having to pay for it while wrecking the character of the place. No thought for the existing residents who paid what they paid to get that type of house and surroundings.
I see part of the problem with our unit title market (as opposed to a built-to-let/corporate market) for apartments, is that so many current body corporates do no allow pets. So many more elderly folks would likely look favourably on apartment living if their cat/dog could move with them.
This is the crux of the issue. Generally people don't want to live in apartments or shoe box terraced houses that we have built here, it is on average, economic and demographic circumstances that drives this behaviour. Not saying that it doesn't have a certain appeal for certain people or at certain times of life but generally, it is less desirable form or living option.
It seems to me we are only intensifying and having this debate because of one thing - population growth. Population against an unwillingness to provide infrastructure but more validly, encroaching on valuable farm land. Population growth because of some of the highest rates of migration in the OECD. And do we want this? Do the migrants actually want this (albeit still better than New Delhi or London)?
Surely all the downsizing retirees would prefer to live close/walkable to amenities and medical care in the smaller inner city townhouses? Anecdotally my mother and many others in her various friend groups are having this discussion more and more. The consensus is to downsize while they are still physically functional so they can get established and love out as many years as possible in their own home without relying on rest home or in house care
A good article.
A slightly related add-on to the article from my own experience is the following:
Prior to the National Policy Statement for Highly Productive Land (NPS-HPL) coming into legislation (which seeks to prevent urban encroachment into good farmland), I played a minor role in trying to prevent a huge subdivision being approved on some of the finest soils in the country, just outside of Lincoln.
Call me a NIMBY if you wish, but high class soils are actually very rare in Canterbury, so it was worth fighting for.
We rallied huge community support backed up by agricultural and soil scientists from the University, made national media and applied huge pressure on the council to decline the subdivision.
The council still approved it. Why? Well of course we live in a world dominated by the holders of capital and their lawyers… BUT also because the NPS-HPL had yet to be implemented. In other words, the morally correct action was not taken by the council because it wasn’t yet written down into law.
Putting aside the fact that some other stronger-willed councils in New Zealand had decided to protect quality soils in the past from urban sprawl despite the lack of legislation, it seems to me that good, common sense decisions now need to made with the help of appropriate legislation in this country, otherwise we are obliged to bow down to the interests of corporations, business groups and their droves of lawyers.
The ability to build cities up, written into legislation that both National and Labour initially agreed upon is extremely important to the future prospects of our country, as is the implementation of the NPS-HPL (especially since NZ has subscribed to the continuous economic growth model, an issue in itself if we humans wish to prosper in the very long term.)
That National would now back out - despite all the evidence such as the appalling loss of outstanding farmland in only a couple of generations, despite increased congestion, despite deteriorating infrastructure, despite lifestyle changes we will have to make due to climate change, despite the energy inefficiency of American-style/dystopian sprawl - is borderline insanity.
Something that comforts me in National’s rather open submission to the ‘real estate industrial complex’ lobby is that many NZers must surely see through their flip flop policies and so they’ll lose voters in the thousands.
Lets be honest here, nobody really wants to make those lifestyle changes. Its all talk and no action, I mean just imagine the uproar these days if we tried to have say "Car less days" again like in the 70's but not because of a fuel shortage but to save the planet. The attitude these days is get stuffed.
Yes, I know the proposed development. Is the decision being appealed? And the other question I had was - what was the present use of the land? i.e., was it's current use for cropping/vegetable production purposes?
It's a really interesting case study - and I fully agree, that the decision should have been paused awaiting the NPS-HPL - but I suspect that current RMA law doesn't allow for that kind of postponement/consideration.
Hi Kate, the farmland is primarily used for dairy and is highly versatile soil, meaning it could be used for cropping, market gardening etc. We’ll need these soils in future.
Yes you’re onto it, the decision is being appealed but in terms of money, it’s David vs Goliath. The community managed to raise some money, but we really need a wealthy donor for further traction… as I said above, we live in a world of holders of capital and their lawyers 🤷♂️
I don't really know the quality of the soil, but accept you have got that right. Having the scientific evidence to prove that will be essential. EDS will often take-on or assist with EC challenges on a pro-bono basis, particularly if they have the potential to set new precedents, and develop new/beneficial case law, under the RMA. They might be worth contacting.
Best of luck with the challenge.
‘The old boys club’ was muttered in the community, but you’d need a professional PI to prove any links between councillors and the building industry. Rumours are not evidence enough.
Given the world renowned soil experts from the local agriculture University that threw their weight behind this to no effect, it has left me rather cynical for the future prospects of our species. Over and over again, despite evidence, we make poor decisions.
Generally that’s how people engage in local democracy, but in saying that I am opposed to the loss of high quality soil anywhere in NZ and have opposed other daft subdivisions on good land elsewhere. I’m not some sort of sustainable development organisation backed by the Gates Foundation though - I can’t do everything.
Does the author realise that transport in NZ is carbon neutral via the ETS? A typical car tank fill of say 50 litres will pay $6 for carbon credits to offset the emissions. So its not possible to reduce net emissions by reducing car use.
Perhaps the article should be edited to correct this.
Because there are not enough carbon credits to cover our future use. Where basically using up our reserves , caused by credits allocated since 1989 , but not charged for too now. As a country we will have to import carbon credits in the future, as a world we are nowhere near carbon neutral .
"What is missing from the MRDS..."
IS GETTING RID OF THE SUBSIDIES.
Resources are more optimally allocated when users pay their full costs.
a) Make developments pay their full costs through targeted rates
b) Remove density restrictions
c) Add national environmental standards for sunlight, wind, smell, etc etc - these will limit the ability to densify single small sections & favour amalgamation of sites to achieve higher densities.
Add while we are at it, remove the massive road users subsidies as well.
The flawed idealogcal thinking with this article is the very reason NZ housing is so unaffordable and of low quality.
The compact city ideology has failed the world over, especially as now people are decentralized due to poor resilience of density and the fact technology allows more people to work from home.
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