Content supplied by the Property Institute
Earlier this week the Government-appointed Productivity Commission delivered a draft report entitled ‘Using Land for Housing’ which contained a range of proposals including the establishment of an Urban Development Authority with the power to acquire private land for large-scale housing developments. The report also contained 37 other proposals including tolls and congestion charges as a mechanism by which to help fund infrastructure development.
Finance Minister Bill English has welcomed the report and has stated that ‘all proposals are up for consideration’.
However, Mr Church has questioned the need for yet another body and has suggested that a new Authority would simply be ‘stepping on the feet’ of the Auckland Council.
“Isn’t this why the Super City was set up? Didn’t it incorporate the powers of a range of other Authorities so that it could coordinate planning and infrastructure development across the Auckland region”?
Mr Church says that, if anything, the Super City provides a stark example of why a single Authority isn’t the solution for Auckland.
“If the creation of a single Authority was the answer to the housing problem Auckland would now be well on the way to solving its housing issues”.
Instead, Mr Church said that it hadn’t gone unnoticed that this property boom – the first since the creation of the Super City – was taking much longer to resolve than any previous boom since at least the early 70s.
“To be fair – that’s not all the fault of the Auckland Council. It’s also the result of strong migration and a strong economy. But I don’t think anyone gets the sense that Auckland Council ‘has matters under control’ – so the last thing the City needs is a new ’Soviet style’, central planning agency”.
Mr Church says that there is some irony in the fact that the multi-city structure of Auckland, prior to the creation of the Super City, would probably have been much better equipped to handle the current housing problem.
“Under the old structure cities competed with each other for residential development and investment – so, by now, you would have expected to have seen areas throughout the isthmus opened up for commercial and residential development in a way which would also have encouraged private investment at a local level”.
Mr Church also repeated an earlier warning that there were already too many organisations, with contradictory interests, already active in Auckland.
“We already have the Reserve Bank, the Government and the Council – all working in contradiction to each other and skewing the housing market in Auckland. The introduction of yet another agency would just make that situation even worse”
6 Comments
Comrade Brownlee did such a great job fixing the crisis in Christchurch didn't he?
In fact what Brownlee did made everything ten times worse. The fact is the market sorted it self out once insurance money flowed.
Chch is proof that intervention artificially creates problems. If Brownlee had not been such an idiot as to demolish liveable houses prior to their replacements being built, the price inflation in both rents and capital prices would not have occurred.
On top of this as ChCh suffered a population exodus to surrounding districts and Auckland, the impact on those other areas would have also been reduced by lesser Government interference.
What no one questions about Auckland is the impact of ChCh insurance proceeds finding their way there, which was a one off boost, which unfortunately coincided with an unprecedented rise in foreign migration.
Closing down foreign migration (or at least regulating it to reduce the bumpiness) should be as far as Governments intervene.
It is ridiculous to intervene to evict people off their land, while you leave floodgates open for people who are not NZers and that we have no responsibility or requirement or for that matter, capability to house.
But don't worry if the Natz stay in Incapability Brownlee will have your property confiscated in no time...
The fact is the market sorted it self out once insurance money flowed.
Exactly - if there was to have been any intervening by CG it needed to be to light a fire under the insurance sector. From afar it seemed to me if anything CG did the opposite - dragged their own chain to give the private sector the leverage it needed to force homeowners into cash payments.
What cost of executive power being mis-directed and diverted to non-productive fix-ups
Reminds me of a corporate episode some 15 years ago when a large ASX company used its financial muscle to unjustly pursue a minnow through the courts. It did it to acquire the IP of the smaller company, expecting a capitulation. The smaller company defended itself and challenged the larger company. It took 6 years for the case to wind its way through the court system
The large company lost, the small company won and obtained a judgement for costs of $40 million
So what you might say
Six months after settlement the small company folded because for 6 years the resources and energy and intellect of management and owners had been so focused on defending itself, that energy was drained away from sustaining and running the company
What Auckland really needs to more state homes, rather low cost housing. Reason being is that low cost housing should be in the $200 - $300k mark. If we want to offer low cost housing in the $450 - $500k mark then this is not low cost housing and is definitely not for people on low wages. Therefore if we want people to work for minimum wages in Auckland in coffee shops, Restaurants, petrol stations, waiting staff, fruit pickers, cleaners then we need to provide more social housing of 2-3 bedroom houses for $50 -$70 bucks a week. This will keep the infrastructure working. If we don't want this then we need to provide the person who cleans the toilets $50an hour to pay for the $350K mortgage with the so called affordable homes. We need truck loads of social housing with cheap rent.
We welcome your comments below. If you are not already registered, please register to comment.
Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.