It’s amazing what happens when you only look at one element of planning and then slap your own anti-urban ideology on top of it. Let’s just change a few things in Rodney Hide’s column today:
There are many reasons why Auckland house prices are high. A lack of tax isn’t one of them.
One reason is that Auckland councils have for years run a deliberate policy to hike house prices. The council doesn’t put it that bluntly, calling it “protecting amenity” or a “allowing for the kiwi dream“. But the policy works by hiking house prices.
The policy’s purpose is to get us to live in huge houses on the edge of the city. That way we will be more likely to drive and the mountains of cash that councils have sunk into road and motorways over the years won’t look such a waste.
And so Aucklanders are priced out of the housing market. The council forces us to build huge houses by limiting development density through a wide variety of planning rules. It’s a double whammy. The roads burn through ratepayers’ and taxpayers’ cash. Plus the “push-the-roads” policy prices Aucklanders out of the housing market.
The policy works by the council imposing a huge number of planning rules which limit density: height limits, density controls, yard controls, setback requirements, single-use rules and so forth. In the places where people most want to live and where prices are increasing the fastest, the planning rules actively stop the construction of more housing. It’s the planning rules that make building apartments, terraced houses and townhouses in the inner suburbs so difficult.
It’s said that the housing market isn’t working. Actually, it’s working perfectly. The council is artificially holding down the development potential of land in the inner suburbs and people are bidding up the price of the precious little that is available. That’s how a market works when there is a shortage.
The result is easily seen. Average section prices in New Zealand account for 40 per cent of the cost of a new house. In Auckland it’s 60 per cent. There’s a 20 per cent council planning tax on Auckland houses.
It’s not hard to make houses more affordable in Auckland. Just loosen the rules. The one part of Auckland where apartments have been allowed fairly easily over the past decade, the city centre, is the one part of Auckland without a shortage of affordable housing.
Unlock the planning rulebook and house prices would tumble. At the very least, the heat would be taken out of the market. Auckland families and couples would once again be able to afford a house. But the council is heading in the opposite direction.
The Auckland Plan is to sprawl 40% of the predicted extra one million Aucklanders beyond the planning fence. Sprawling them out means huge environmental effects and billions of dollars spent on infrastructure to enable development in places where people actually aren’t so keen on living.
The plan is to spread urban development across a vast tract of Auckland’s most highly productive soils to the south and northwest, destroying fragile ecosystems and requiring the construction of vastly expensive new infrastructure like wastewater treatment plants, motorways, hospitals, schools and so on. That sprawl is only going to occur by limiting the potential for intensification and pushing house prices even higher. That’s why couples and young families can’t afford a house. The council doesn’t want them to live in a apartments or terraced houses near train stations, but in giant houses on the urban periphery.
It’s not like there aren’t options: 93 per cent of Aucklanders quite happily live within the Auckland urban area. But the area within the fence is less than 12 per cent of the council’s land area. Auckland’s people density is apparently not high enough for the government to invest in public transport, even though it is twice the density of Brisbane or Perth.
Auckland is packed tight like an old European city as people want to live in the inner suburbs. The council’s aim is to sprawl us out like Atlanta or Houston.
There’s a reason for high house prices. It’s us. We have been voting for years for councils promising trains, “smart growth” and a “compact” city. Despite this, our planners continue to promote sprawl and the government refuses to invest in public transport. This is why young families and couples can’t afford a house.
It’s our votes that are doing it. It’s that simple.