Changes to the way council rates are calculated, a change in emphasis on heritage protection in the suburbs and a greater involvement by central government in urban development are among key recommendations of the Productivity Commission's final Using Land for Housing Report released today.
The report was commissioned by the government to look into the processes that councils in fast growing areas use to make land available for housing and has particular relevance for Auckland because of the severe housing pressures the city is facing.
It has made 70 wide ranging recommendations which, if adopted, could have a major impact on the way new housing is developed in this country.
Some of its recommendations are clearly aimed at making it easier to develop more high density housing such as apartments.
These include:
- Requiring councils to undertake a cost-benefit analysis before introducing height restrictions on buildings and increasing current height limits where it cannot be shown that the benefits they create outweigh the costs.
- Avoiding wide-ranging heritage or special character policies that restrict redevelopment of housing stock. The report recommends that councils should instead concentrate heritage and special character policies on individual structures rather than whole suburbs.
- Councils in high growth areas should avoid explicit limits on housing density and review existing limits with a view to removing them.
- Remove requirements for apartments to have balconies and restrictions requiring apartments to be a minimum size.
- Remove minimum parking requirements from District Plans.
The report also recommends changing the way councils calculate their rates.
It recommends basing rates on the land value of a property rather than its capital value (which includes the value of any buildings on it).
This would also favour multi-unit dwellings such as apartments and would be likely to increase the share of rates paid by houses on larger sections.
It would also encourage owners of vacant land to develop it more promptly rather than land banking.
The report also recommends that the current rates exemptions on Crown-owned land be removed, which could see government institutions such as schools and hospitals having to start paying rates.
And it recommends that the government amend the Resource Management Act, so that councils would only need to notify "directly affected parties of proposed plan changes that are specific to particular sites."
It also proposes making it easier for foreign property developers to operate in this country, by enabling them to purchase land without Overseas Investment Office approval, provided the land is developed into housing "within an acceptable timeframe."
The report is supportive of the concept of council-backed urban development authorities and has recommended that the government introduce legislation that would enable them to operate in a similar to Special Housing Areas provide that fast tracked approval of new developments, which would include "restricting public notification."
It also wants urban development authorities to have compulsory acquisition powers that would allow them to acquire land for new development following the processes outlined in the Public Works Act.
Another major theme of the report is a greater involvement by central government in increasing the supply of new land for housing and its recommendations in this area include:
- Having the Government monitor and report on the relative price/values of developable and non-developable land in the fastest growing cities.
- Establishing a price threshold in the difference between the developable and non-developable land, that would act as a trigger to release more land for development.
- Having the Government involved with local councils in the process of bringing forward the supply of new land for development where it is required, and of ensuring that the necessary infrastructure for such development is also provided.
- Having the Government make the preparation of long term infrastructure strategies part of its normal planning and reporting framework.
The report has also made specific recommendations about the way Watercare (Auckland's council-owned water and wastewater service provider) charges for installing infrastructure to new developments. It recommends that these should be adjusted to reflect the different costs involved to supply infrastructure to different types of developments in different locations.
To read the Productivity Commission's full report, click on the link below:
17 Comments
yes please!
More squares, buildings, areas only for pedestrian, cafe terraces, bars, shops in the lower parts of the buildings and density of population in some areas.
It's more efficient, more ecological, cheaper in cement and infrastructure consumption.. and fun.
We have enough gardens. How about we stop invading natural areas if we really like nature and start growing upwards?
"Remove restrictions requiring apartments to be a minimum size."? Consequences will be developers seeing how small an area they can shove someone into. Rather than providing a "living Space" it'll be literally "little boxes" to subsist in. Potentially creating a new form of poverty for people who have no other choice
the parking spaces in district plans needs to go.
Many people dont use cars anymore, having a requirement for 2 car parks per dwelling, even in a single bedroom is silly.
Anyway Ive heard most of these before, the productivity commision generally gets ignored.
If the developed land : non-developed land threshold was implemented it would create some interesting dynamics that no one could really predict. It would throw a spanner in the works of all land bankers. Something like this might actually be rather brilliant as it creates the idea of plentiful supply (eg if prices get out of wack, more land automatically gets opened up) without actually having to re-zone massive amounts of land which would create excessive sprawl.
The Productivity Commission had already more or less identified that in a previous report. It has been official advice to the current government for the last 3 years but they have done nothing with it. Although, by the standards of the current government, three years of inactivity is but a heartbeat.
The whole of this report needs to be read in conjunction with the Terms of Reference English, Bennett and Smith set for the inquiry. This report could have been bolder but it was always going to be knee-capped to some degree.
A blank sheet of paper would have been a more accurate report.
No disrespect to the Productivity Commission but they were asked to identify the best practices in councils for managing growth. There are no councils that manage growth well. So the real report should have been very short.
The government handed this job over about three weeks before the last election. It was part of National's wider vision for improving housing affordability that also included....well...um....nothing. It was pretty obvious at the time that this inquiry was more about kicking the can down the road than producing anything substantive.
There was one opportunity in the ToR that would have allowed the PC to be bold: they were encouraged to be as creative as they liked about infrastructure funding. This is a key area constraining increasing supply of housing but it looks as though the PC bottled this opportunity.
First, fix the building code, or ensure developers adhere to it. You'd never get me back in an apartment after the last experience of paper thin walls and hearing everything the neighbours above me do.
Secondly, why does a two bedroom disposable (i.e. starts falling apart after 10 years) apartment cost the same (at least in Wellington) as land + house? Where are the economies of scale?
The market will fix these things itself - people know to look out for these things now, so developers are putting in the extra money to do things right. The big demand in Auckland at the moment is for high end apartments.
Are you sure you aren't leaving location out of your calculation - I can guarantee you an apartment in central Auckland would cost a significant amount less than a house in central Auckland (maybe 100x less).
The resource consenting process for subdividing is literally 1-2 years. Even with every adjacent neighbor's full consent, things like height to boundary infringements, density infringements and other stuff of that nature get tossed out. Planners need to relax some of these restrictions when all affected parties are happy with the plans.
Of course there should be more apartments in Auckland,but given the appalling track record of putting up leaky,indeed potentially lethal buildings,why would anybody buy them?
High building standards should be something that potential buyers can take for granted,but the government,councils and developers just want more buildings thrown up,irrespective of quality.,so nothing will change.
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