Photo of The Day: Signs of a Better Auckland on its Way

Cranes. Lots of cranes on the Auckland skyline at the moment. Many of them are building apartment projects, especially in the shot below.

THE DYLAN_1248

I particularly like this view because it shows that an area that long been dominated by one type of dwelling; detached Victorian houses, is now getting this resource complemented by a good volume of a different kind of dwelling. This is especially important as these old buildings have recently become extremely expensive through both further investment [massive upgrades] and good old fashioned scarcity plus neighbourhood desirability. So more people and different kinds of households are now entering this lovely neighbourhood with its existing infrastructure and great proximity to the city.

While the prices of the apartments reflect these qualities of the location [naturally] and therefore are not as cheap as those out at the end of the motorways, they are still easily under half the price of the surrounding done-up detached houses, and even many that are entirely uninhabitable. And therefore will help to add to the range of price points in the local market as well as the total number of dwellings.

Additionally, and something that’s dear to my heart as an existing resident of the area, all these additional locals mean new and better local amenity; more cafes, restaurants, and employment opportunities as more businesses move in to serve them [all three of my children work locally]; essentially more choice and vibrancy, because there’s simply more people on the streets. And it means that our neighbourhood will earn the right to better social services too, like more frequent bus services, street and park upgrades, and more funding for cultural events. In particular the new intensity along Great North Road is making a strong case for this route to both to be upgraded to a real boulevard, and to one day perhaps providing sufficient demand for the transit route west here to be upgraded to Light Rail.

It is especially pleasing too that these new apartment buildings are clearly better designed and built than those of the last boom in the mid-2000s. And what are they displacing? Car yards. Low land value, slow turnover carparks; what could be better?

This is picture that makes me a very happy urbanist and an even more happy local.

Photo of the Day: Mere Kirihimete

Christmas trees and the changing city:

37 ANZAC_5494

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Two of my favourite things; a more dynamic city and Pohutukawa trees. Have a great day and we’ll see you for an even more urban 2016!

 

 

 

Postcard from Freiburg

After Paris we spent a day and two nights in Freiburg before heading on to Switzerland to meet Stu Donovan and go skiing. By the time you read this, we will be on the slopes! Here are a few thoughts and impressions of the place.

Freiburg is a small city of about 220,000 people near the Black Forest in southwestern Germany. It’s gained an international reputation for being one of the most sustainable cities in Europe. What this means, in practice, is that it seems to combine the best of both big cities – on-street vibrancy, especially around the historic downtown – and small towns – quiet, safe neighbourhoods that are good for young families.

According to our hosts, the city’s cycling mode share – for all trips, not just commuting – is roughly equal to its car mode share. About 30% of trips are on bicycle, and 30% are in cars. The remainder is split between the city’s light rail system and walking.

But it hasn’t always been thus. Freiburg was headed down the road to motordom in the 1950s and 60s. But, like many Dutch cities, it took a different direction in the 1970s, expanding its tram system rather than pulling it out, and starting to build cycleways. They’ve got 420 kilometres of bike lanes, including separated cycling highways, 36 kilometres of tramways, and expansions in the works.

Freiburg’s public transport system has roughly the same level of patronage as Auckland – almost 80 million trips a year. (And, apparently, a farebox recovery ratio of over 80%.)

So far, so good. But Freiburg is growing quite rapidly – a consequence of its attractiveness as a place to live, I suspect – which is putting pressure on housing. Rents are apparently rising, and the city council (which is led by the local Green Party) has to plan for this growth. Freiburg is already a midrise city – three to five storeys in most places – so it is debating its next steps.

In line with past practice, this means a bit of up and a bit of out. New apartments are being planned for some parts of the city, and the city’s negotiating with farmers to buy some more land at the edge. Hearing about the options, and the constraints, I was struck by how familiar it all would seem in Auckland. The farmers were holding out for higher prices for their fringe land. Heritage preservation policies in the old parts of the city make it difficult to build up there. It’s not possible to develop in biodiversity areas or in the Black Forest. Minimum parking requirements add significant cost to new housing.

Wait, minimum parking requirements? In the sustainable city of Freiburg?

Apparently, yes. MPRs in Germany were imposed by a federal law in 1939 – perhaps the earliest example on the books, which would make them literally a Nazi invention. They are still generally in force today, although there’s been a trend to devolve control over minimums to local governments. In Freiburg, the minimums have recently been reduced from one parking space per dwelling to 0.6 spaces per dwelling. (In Berlin, by contrast, they have been removed entirely.)

However, there have also been some innovative ways to get around MPRs. For example, the suburb of Vauban was developed as an energy-efficient, car-free neighbourhood. Requiring one carpark per home would have undermined the concept pretty badly, so parking was instead provided in three garages at the edge of the development.

However, one of those garages was not actually constructed. Instead, everybody in Vauban who didn’t want a car bought into an association that had the option to develop the underlying land for carparks. In effect, rather than buying a carpark, they bought insurance against the possibility that they would need one. Apparently this saved car-free households around 18,000 euros. And the third parking garage still hasn’t been built – the land is still being used as a playground.

The word “association” seems to be an important one when it comes to housing development in Germany. Germany law and tax policies make it easy and advantageous for people to club together to develop multi-family dwellings. A lot of the apartment buildings and terraced houses in Vauban were built this way. Basically, get together with some friends, buy a bit of land, and hire an architect to design an apartment building for you. You’ve got to comply with some high-level rules about bulk and form, but other than that the design is up to the occupants.

I would be interested in learning more about this model. It could be really compatible with New Zealanders’ aspirations for housing – we have a preference for designing (and even building) our own houses, but Auckland’s high land prices make it costly to build standalone dwellings. Midrise apartment buildings could fill the affordability gap, but the current developer-led model doesn’t suit everyone. So perhaps look to Germany for an alternative model?

Phil Goff: For a better Auckland?

On the weekend Phil Goff announced his bid for the Auckland mayoralty. Several interesting articles on Goff’s bid have been published, for example ones by the Herald and Radio NZ here and here respectively. A more recent article by the Herald is available here, which suggests Goff may be the favourite and exhorts him to “exert control”.

eight_col_PhilGoff

In this post I’ll discuss and interpret some of Phil Goff’s comments on local government in Auckland. The post is split into three juicy topics: 1) Rates; 2) Asset sales; and 3) Intensification. I should note that it’s relatively early on in the campaign, so in some ways this post raises more questions than answers. I hope you enjoy it nonetheless.

1. Rates

So what is Goff’s position on rates? Well, for starters at least Goff has his figures right: He notes that rates for the average household increased 3.5%, while also observing that some households experienced increases of up to 10%. Basic data analysis is something that seems to escape some journalists.

Now don’t get me wrong: 10% increase in one year is a big jump.

However, one of the things that got lost in the recent clamour is that some of the increase in household rates was associated with adopting single rating system for all of Auckland. This required harmonizing quite disparate rates across Auckland. Naturally, some people found their rates went up, while others found their rates went down.

The good news for Goff, and any other mayoral candidate, is that the difficult process of harmonizing rates is now largely complete. Len Brown has borne the brunt of that central government hospital pass. As such, the incoming mayor – whoever they are – will benefit from this issue dropping off the radar. So how will Goff seek to keep rates under control in the future?

Well, in his interview on Radio NZ Goff talked “prioritizing” projects, i.e. less important things give way to more important things. This really was the thrust of this recent post which I wrote on the effectiveness and efficiency of local government in Auckland.

Unfortunately we don’t know yet what Goff’s priorities are, so it’s hard to assess the size of the potential savings. There are however a number of poorly-performing transport projects which could be ditched, such as PenLink and Mill Rd. Right there Goff could save the mighty taxpayers of Auckland several hundreds of millions of $$$.

One issue Goff didn’t discuss is Auckland Council’s desire to shift the burden of rates away from businesses and onto residents.

This shift, as I understand it, is designed to reduce the costs faced by businesses, so as to 1) reduce prices for goods/services and 2) increase employment, both of which ultimately benefit residents. While this is a policy direction that I happen to support, it has also contributed to some of the recent increase in residential rates. We don’t yet know where Goff stands on this issue, but it’d be interesting to find out because it is one factor that will cause residential rates to rise faster than inflation.

2. Asset sales

Now we start to get into the nitty gritty about how to keep rates under control. One of the more controversial ideas that has been in the media lot lately is the subject of asset sales. It’ll be interesting to see where the mayoral candidates fall on this issue, because it really is the primary opportunity to find more money to invest in things that will make the city better.

In his interview on Radio NZ Goff distinguishes between what he calls “strategic” and “non-strategic” assets. He says no to the latter, especially in the context of Watercare. Auckland Council’s shares in Ports of Auckland and Auckland Airport, for example, also appear to be in the “not for sale” basket.

Now I can appreciate the need to distinguish between strategic and non-strategic assets, where the former are deemed to provide efficient support to Council’s strategic direction and the latter do not. However, I think there’s a need for Goff to outline not only which assets he considers to be strategic, but *why*. This would help shed light on his underlying values, and mitigate against the “slippery slope” arguments that are advanced by some people in discussions of asset sales.

On the other hand, it should be noted that from the interview it seems that Goff’s views on golf courses are relatively well-aligned with our own views here at TransportBlog. I’ve paraphrased the most relevant parts of the Q&A as follows:

  • Interviewer: What about flicking some of the golf courses?
  • Goff: Remuera golf course is worth $560 million and the subsidy for every golfer is $11,500 per year.
  • Interviewer: So we could expect some golf courses to be sold for housing?
  • Goff: I’m going to look at the facts before I make a commitment on that. But I don’t think it’s fair for Aucklanders to be subsidising those people who are lucky enough to be members of a golf course …

FYI here’s what a subsidy of $11,500 per golfer per year buys them.

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Or here’s another fact just to ram it home: The annual subsidy for golf courses in Auckland is approximately equivalent in value to the annual cost of operating Auckland’s rail network. So when someone tries to tell you that asset sales will not have a meaningful impact on Council’s ability to deliver other goods and services, you should tell them they’re dreaming.

Personally, Goff’s views on rates and asset sales seemed fairly reasonable to me, even if more details are needed (NB: The same goes for all the mayoral candidates of course).

3. Intensification

Now let me present one psuedo-question in the Radio NZ interview and the subsequent response from Goff:

  • Interviewer: There’s more talk today about intensification in some of those inner-city suburbs, such as Mt Eden.
  • Goff: I don’t see us putting up tower blocks in some of those really nice areas. What I see us doing is working down the main arterial transport routes, looking at places like New Lynn and Panmure. Those are the ideal places where you might want to put 3-4 storey intensive housing, plenty of public open space and making sure it’s good urban design. I don’t think that you start to encroach on the most beautiful parts of the city, before you, say, let’s follow the transport routes so that people can be close to where they are moving to.

There’s some good stuff in what Goff says, e.g. on concentrating development in areas where transport infrastructure exists and the need to focus on urban design, both of which have been somewhat lacking in earlier iterations of Auckland’s development.

There are also, however, some very unfortunate words and attitudes underlying Goff’s comment. Here’s the part I was most concerned by: “I don’t see us putting tower blocks in some of those really nice areas“.At this point my little red alert warning signals started to go whoop whoop. More specifically, in this comment Goff strays into very dangerous territory my friends.

Let me explain why.

First let’s consider what Goff is trying to say. From where I’m sitting, it seems that Goff is saying let’s not intensify in areas that are “nice”. Why? Well, the obvious implication is that intensive development is not nice?!? Goff meet Ockham. More specifically, if Auckland is to progressively change the discourse around housing, and thereby lance the housing boil that threatens our entire economy, then we need large numbers of apartments and town houses to be built. And we need them to be built all across Auckland’s central suburbs, where people want to live, not just in a few places like Panmure and New Lynn.

Second, in this sentence Goff implies that he will seek to undermine normal market forces. More specifically, if an area is “nice” then people are going to want to live there right? Goff seems to be saying that as soon as an area becomes “nice” then Council is not going to allow development there. By extension, Council will presumably only allow intensive development in location that are not nice? Where there is no demand to live? Great, Council can zone away its heart’s content, but it won’t ultimately change anything, all we’ll get is higher property prices in areas that are unable to be developed further.

Which brings me to the third issue with Goff’s seemingly innocuous statement: Goff’s use of the word “nice”. What does this imply for the areas of Auckland that are not like Mt Eden? Goff seems to think Council can identify a couple of not nice places and direct all the “poor” people (who can’t afford to buy a nice big ol’ villa on a large section in Mt Eden) to live there. Think again. Question: What if people all over Auckland come forward and argue their neighbourhood is nice just the way it is?

Answer: Goff either has to 1) tell them that they’re wrong or 2) roll back the intensification planned for those areas. That’s right: In arguing that we shouldn’t intensify certain areas because they’re “nice”, Goff has unwittingly created a rod that any NIMBY anywhere can use to beat back proposed intensificatio – on the grounds that their area is already “nice”. End result? Whole-sale down-zoning in response to self-interested parochial interests.

Now, in Goff’s defence, he is not alone in slipping down this slippery slope.

In fact, the interaction between planning regulations and political economy has been studied elsewhere. This interesting article from Los Angeles, for example, discusses how their planning regulations prevented intensive developments from occurring in areas where there was demand. Sound familiar?!? These regulations were found to have a massive negative impact on development capacity in Los Angeles, as illustrated in the figure below.

FrameWORK_Housing_ZoningCapacity

For this reason it is not surprising that Los Angeles has had the “fastest increase in home values since 2000” and “has become the least affordable major city in the country“.

In a nutshell: The more Goff is inclined to pick “winners” and “losers” when it comes to what types of housing can be developed in which areas of Auckland, then the more expensive and segregated Auckland is likely to become. Personally, I struggle when residents and politicians effectively say “we want the kinds of people who live in apartments to live over there, because this area is too nice for them“. That’s the definition of snobbery.

The discourse surrounding this issue is even more farcical when you realise that many of Auckland’s older suburbs are already peppered with 3-7 storey apartment buildings. Like my apartment building, which is over 100 years old. Like many apartment buildings in Auckland that were built before regulations and locals made it too difficult.

And let’s be honest: The debate we’re having is not about “tower blocks”: It’s about whether you should be able to build a 3-7 level building in Auckland’s extremely valuable and desirable central suburbs. You know, like the kinds of development that one finds Sydney and Melbourne. To which I say abso-bloody-lutely.

End result? I think Goff needs to think more subtly about intensification.

4. Conclusion

Overall score for Goff’s initial foray into local government issues? Well, I’d give him a 2/3. When it comes to rates and asset sales, Goff stated some reasonably coherent positions, while also appearing open to debate and discussion. Which is good, because after all he’s only one vote on Council so at the end of the day we shouldn’t overstate his importance.

While Goff is shaping up to be a good centrist mayoral candidate, it looks like housing and intensification may be areas for improvement.

At this point it’s worth mentioning that Goff naturally wants to win, and winning involves appealing to people from across the political spectrum – many of whom like Auckland the way it is and don’t want it to change. But allowing more housing, and more intensification in particular, is the single most important issue facing Auckland right now (yes bigger than transport).

For this reason, Auckland’s next mayor needs to champion Auckland as an integrated city, not a collection of self-interested suburbs.The reason we should sell Remuera golf course is the same reason we should allow for more development in Mt Eden: Because it’s in the best interests of Auckland as a whole. Both now and into the future.

I would like to elect a mayor who doesn’t apologise for the need for intensive development in central areas. A mayor who engages with the concerns of existing residents, but doesn’t compromise on the underlying reality facing Auckland and the city’s growth. Development is not a disease that needs to be quarantined in not so “nice” places. Multi-storey buildings already exist in Auckland’s inner-city suburbs, like they do in Melbourne and Sydney and almost any city of similar size.

Indeed, I’d personally argue that Auckland’s lack of density, and the consequences for civic life, is a primary reason why Auckland struggles to retain its young people. The life of cities like Melbourne, Sydney, London, and Amsterdam is what attracts young peolpe like me. I think our approahc to housing needs to be framed in that context: If you want your grandchildren to live in this hemisphere, then you’ve got to allow for more intensive development in Auckland.

Goodbye, goodluck, and godspeed to you my fellow Auckwooders. May Goff be with you.

Goodbye BMD. We’ll miss you

And now for something completely different. I was saddened to learn that the street artists BMD are disbanding:

The legendary street art collective BMD has split up.

Known for their distinctive wall markings, often including warped animals and cartoon objects, the two Taranaki artists behind BMD have announced they are parting ways.

As part of the separation process they have revealed their identities as Damin Radford-Scott and Andrew J. Steel.

The contemporary art duo have spent the past 10 years building their brand into an internationally recognised mark.

Throughout their partnership the men behind the murals chose to conceal their individual identities.

They once cited the reason for their anonymity was an effort to have their work judged for what it was and not for who the artists were.

But since announcing their split the pair have decided it was now time to unmask themselves.

Friends since the two attended Devon Intermediate School in New Plymouth Radford-Scott and Steel have spent a decade embellishing public spaces throughout the region, across New Zealand and overseas.

However, in more recent times the pair had started to move in different creative directions and they agreed the split had been on the cards for a little while.

Radford-Scott, who works independently under the artistic moniker of Milarky, said it was inevitable.

“We’ve changed as people, we used to gel really well together but it’s not quite like that anymore,” he said.

BMD are responsible for some weird and wonderful murals on walls up and down the country. I’ve seen their work on K Rd, Carlton Gore Rd, down in Taupo, New Plymouth, Wellington, and Christchurch, and even a couple odd paint-jobs next to obscure highways up north. Once you’d seen a few pieces of their art, it was instantly recognisable – vivid colours, animals with weird human expressions.

You can see their work here. Here’s a few of my favourite pieces.

BMD for anti-shark finning, Wellington, 2013. Photo: Norman Heke

BMD for anti-shark finning, Wellington, 2013. Photo: Norman Heke

Auckland, 2013. Photo: BMD

Auckland, 2013. Photo: BMD

Taupo details, 2011. Photo: Blake Dunlop

Taupo details, 2011. Photo: Blake Dunlop

I’m sad to see BMD end. Damin and Andrew have done a great job beautifying New Zealand’s cities. But I’m also looking forward to seeing what they come up with on their own.

Amsterdam is “bad ass”

Greetings from Amsterdam. As some of you may know, I’ve recently moved here from Brisbane to begin a PhD in Economics. Fun times.

In this post I want to briefly touch on some reasons why Amsterdam is such a “bad ass” city and possibly glean some information that may be relevant to Auckland. As discussed in this TED talk which Matt linked to recently, Amsterdam’s city flag is relatively “bad ass” insofar as it follows principles of good flag design, as illustrated below.

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Before we begin please ponder a question: What do you think of when you hear the word “Amsterdam”?

In my experience, for many New Zealanders the word Amsterdam evokes images of a psychedelic mash-up of bicycles, tulips, joints, and red lights. As is often the case, however, impressions formed from afar tend to reveal more about the place from which the observation is made than the place that is being observed.

As any one of the many kiwis I have met here will attest, Amsterdam’s “spirit” is not found in the red light district nor in its liberal approach to managing psychedelic substances. Nor even cycling. Why are foreigners so fascinated by bicycles? Indeed, for the locals, the usefulness of a bicycle is a given. It simply is the best way to get around, and the most efficient form of urban transport. Hands down.

These things are simply consequences of much more profound socio-economic factors.

In my view, the spirit of Amsterdam is encapsulated in an attitude of “practical and engaged tolerance”. It’s an attitude which says “I don’t mind what you do, so long as it doesn’t negatively impact me.” And if something you’re doing does negatively impact me, then I’ll simply let you know and we’ll sit down and have a rational and informed conversation about what to do about it. Or I’ll find a way to avoid the problem.

Like cycling. Many people are of the view that the Netherlands has always been a cycling nirvana. That perception is incorrect. From a policy perspective, the Dutch only really started to consciously embrace cycling from the 1960s onwards. This was a deliberate policy decision made in response to two main factors:

  1. Peaceful but widespread protests by residents in response to the growing number of cyclists who were being killed by private vehicles; and
  2. The oil shocks of the 1970s, which the Netherland’s government decided was a good reason to develop a more sustainable transport system.

Both factors are discussed in this fantastic video, which is titled “How the Dutch got their cycle paths“.

Basically, it was felt that there was 1) a moral need for safe cycling facilities and 2) an economic rational for doing so. The result? Elected representatives and policy-makers put their heads together and made sustained investment in cycle facilities over many years. Has Amsterdam failed as a consequence of what was, at the time, a rather significant shift in transport policy?

No, if anything it has prospered. PwC’s recently released Global Cities Study scored Amsterdam as follows:

Amsterdam

By this measure, Amsterdam was ranked fourth in the world and second in Europe. Amsterdam scores first on both “health, safety, and security” and “sustainability and natural environment”. In short, Amsterdam is a socio-economic powerhouse. This is the view that I try and give to people when they ask me “what is Amsterdam like?”. Yes, Amsterdam is business time.

Sure, as well as having great jobs it’s also a great place to live. Why? Well, residents tend to identify strongly with and celebrate being in Amsterdam. For example, a few weeks ago Amsterdam celebrated “Sail”, which is an event held every five years that brings together tall sailing ships from around the world. I understand the event is the largest of its kind in the world and requires the Port of Amsterdam (which is a major sponsor) to be shut for several days.

It’s big bikkies and the time lapse video below gives you a feel for the scale of the celebrations.

There’s many other similarly amazing events. “Museumnacht”, for example, is an annual event where the museums are turned into nightclubs with top DJs from around Europe. People buy a ticket to the whole event which gains entry to all museums and dance their way around top artworks.

So I hope that gives you a feel for Amsterdam.

But how is Amsterdam doing on the land use and transport front in more modern times? Well, I’ve only been here 4 weeks so I need to do more research. However, I can briefly outline two reasons I’ve already found for why Amsterdam is doing fairly well in a few areas where Auckland might still be able to learn a few tricks.

The first thing is that minimum parking requirements simply don’t exist. That’s right: Developers can choose how much parking to provide to meet the needs of their customers. While parking management policies (e.g. parking prices and/or travel demand management measures) may be something the developer will discuss with the municipality during processing of their application, there does not seem to be any stipulated requirement to provide a certain amount of parking with certain types of developments. Instead, there is simply an expectation that the developer will “think about it”. How bizarre. And effective.

The second thing is that Amsterdam has, for more than 5 years, focused on one public transport project: The North-South metro line. While Amsterdam scored relatively well in the aforementioned PwC survey, one area where it did not score so highly was in the “transportation and infrastructure” category. On the surface this seems strange. I mean, Amsterdam achieves ~35% cycle mode share while another 20% use public transport. The City also benefits from an extensive national heavy rail network which carries 1.1 million passengers per day across the Netherlands. As an Aucklander it’s sometimes hard to think how the transport system could get any “better”.

However, when it comes to transport there are two things to remember about Amsterdam.

The first thing is that because Amsterdam is successful, Amsterdam is congested. There’s a lot of things going on pretty much all the time. Special events such as Sail are a regular feature of the calendar. Hence, if you are not cycling, then the roads and public transport are quite congested. No shame there, but I think it’s interesting that policy-makers in New Zealand still don’t understand that a successful city will likely be congested. In other words, places that aren’t congested aren’t successful. It’s important to note that this is not equivalent to saying “we shouldn’t worry about congestion”, but simply noting that no congestion is not the end goal. Instead, the end goal is a city where many people can avoid congestion altogether, when and where it eventuates, by using alternatives.

The second thing to note is that public transport in Amsterdam’s is not that great by European standards. The LRT has good coverage but is relatively slow and somewhat infrequent while the metro has limited coverage and is relatively indirect for many journeys. As you can see from the network map below (NB: The northern terminus of the Green metro line looks strange until you realise that it connects with a frequent heavy rail connection that exists between Slöterdijk and Centraal).

Amsterdam_Metro_Kaart_001

So how do policy-makers in Amsterdam propose to “fix” their transport problems? Well, the “North-South” metro line includes six new stations and an extension to the north shore, as illustrated in blue below. Boom. It’s as if Auckland looked to combine the CRL and a metro rail to the North Shore into one project.

nz_trajectkaart_big_00

The contrast between the North-South metro line and what NZTA are planning for the next harbour crossing in Auckland could not be more stark. Whereas NZTA is planning to spend billions to achieve a relatively marginal increase in capacity within an existing highway corridor that by world standards is only moderately congested, Amsterdam is already spending similar amounts of money on a project that massively expands the coverage and directness of their rapid public transport network.

In a nutshell: There seems to be widespread acceptance among policy makers in Amsterdam that if peak urban travel demand is the problem, then investment in road capacity is not the solution. Instead, the preferred solution here is to invest in strengthening the rapid transit network first, and then investing in frequent local PT that connects to this RTN network. While Auckland gets the latter part of this equation, it has not yet realised that this investment needs to happen *instead of* investment in highways.

There’s many other reasons why Amsterdam is a great place to live, and I’ll no doubt explore some of them in future posts, assuming that I manage to survive my courses. In the meantime, rest assured that notwithstanding the weather and the pain of having to study graduate microeconomics, life “ist goed.” Tot ziens!

Travel diary: Beachfront cycling in LA

I was recently on holiday in California. Here are some thoughts and images from the week I spent in Los Angeles, a car-dependent city that is, like Auckland, trying to become something different.

One of the frustrations of travelling in California is how much time I spent in cars. While in Auckland, I get in a car perhaps one day every two weeks – the rest of the time I get around by public transport or under my own power. In California, I drove every day, which was enjoyable at times and frustrating at others.

However, I was lucky enough to spend a fantastic afternoon cycling in Los Angeles. This is not as stupid an idea as you may initially assume. While the city has devoted little space on its wide roads to cyclists, it does have some amazing cycling assets, such as the Marvin Braude Bike Trail. (Unfortunately, I left two days too soon to attend CicLAvia, which a friend highly recommended.)

Lasouthbaybiketrail

Marvin Braude is an example of doing cycling infrastructure right. It is a fully separated bidirectional cycleway that runs along a seemingly endless string of Southern Californian white-sand beaches. We rode about 20 kilometres from Redondo Beach to Marina Del Rey and returned via the same path.

Although LA is not known as a walking and cycling city, the cycleway was mobbed by people even on Monday afternoon. We were often cycling in the midst of a crowd of cyclists. Some surfers were even transporting their boards via bike-mounted surfboard racks!

It just goes to show that if you build it well, they will come:

20150803_185806 copy

The cycleway also gave a nice view on LA’s eclectic mix of architectural styles and land uses. There were many, many blocks of elegant beach-front mansions and condos, complete with traffic-calmed residential streets and pedestrian-focused accessways.

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However, there were also signs of LA’s practical, industrial side, such as the monolithic Scattergood Power Station, which serves as a dividing line between the well-to-do southern beaches and the decidedly more working-class Dockweiler State Beach.

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We finished up the ride with a sunset swim back in Redondo. Just after we got in the water, we were surprised by a pack of friendly dolphins that were frolicking in the surf. I didn’t get a picture of the dolphins, but here’s one of the sunset:

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I’d recommend this bike trip to anyone visiting Los Angeles. I’d also recommend that all other coastal cities should get to work on building their own separated cycleway on the beachfront! Hint, hint, Tamaki Drive…

Travel diary: California 1

I’m currently on holiday in California. One of the pleasures of travelling around California is that you get the opportunity to drive down (or better yet, up) California highway 1.

California 1 runs up the coast from Orange County to Mendocino County – from Southern California’s suburban heartland to Northern California’s rural hippie economy. (Like parts of New Zealand, Mendocino is home to a vibrant marijuana industry.) Along the way, it runs through Los Angeles, San Francisco, and a number of California’s great public university beach towns. Every time I stop in Santa Barbara or Santa Cruz, I feel that New Zealand’s missed out by not putting a university in a seaside town like Napier or New Plymouth.

Not everything about California is great, but I definitely think that the state does coastlines right. I’m always struck by the sheer variety along the coastal highway. There are many good white-sand beaches and dunes – we went surfing at one near San Luis Obispo – that are packed with Californians at this time of year. But there are also sections with coastal redwoods and dramatic rocky cliffs, such as Big Sur and the coast north of San Francisco. Here’s one photo I took en route:

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Rather than try to describe the California coast in detail, I’m going to rely on Douglas Adams’ description from So Long, and Thanks for All the Fish, the fourth book in his Hitchhiker’s Guide trilogy. It’s incomparably better than anything I could come up with:

The beach was a beach we shall not name, because his private house was there, but it was a small sandy stretch somewhere along the hundreds of miles of coastline that first runs west from Los Angeles, which is described in the new edition of the Hitch Hiker’s Guide to the Galaxy in one entry as “junky, wunky, lunky, stunky, and what’s that other word, and all kinds of bad stuff, woo”, and in another, written only hours later as “being like several thousand square miles of American Express junk mail, but without the same sense of moral depth. Plus the air is, for some reason, yellow.”

The coastline runs west, and then turns north up to the misty bay of San Francisco, which the Guide describes as a “good place to go. It’s very easy to believe that everyone you meet there is also a space traveller. Starting a new religion for you is just their way of saying ‘hi’. Until you’ve settled in and got the hang of the place it is best to say ‘no’ to three questions out of any given four that anyone may ask you, because there are some very strange things going on there, some of which an unsuspecting alien could die of.” The hundreds of curling miles of cliffs and sand, palm trees, breakers and sunsets are described in the Guide as “Boffo. A good one.”

Finally, one thing I like about travelling around California is the density and diversity of destinations. Although the state is only around 60% larger than New Zealand, it’s home to almost 39 million people. This undoubtedly feels a bit crowded at times. But it also means that when you’re travelling between places, as we were doing on California 1, you will pass through a number of other interesting places on the way. Everywhere is on the road to somewhere else.

I like my house

I like my house.

My house consists of a 50sqm, one-bedroom apartment located in the “Brooklyn Building” on Emily Place in Auckland’s city centre. The Brooklyn Building is almost 100 years old and I understand it was designed by an American architect who originated from Chicago. My building has no balconies and no car-parks. Shock, horror, destined for squalor?

Maybe.

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What a terrible investment, you might think? Well, in the 8 years since I’ve owned my house the value has approximately doubled and it currently rents for more than if I sold up and put the money in the bank. The economic side of me is at a happy equilibrium.

And, after 12 months of renovations (and a fair whack of dosh) my house now looks like this. The aesthetic side of me is pleased.

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“Kiwis” don’t like apartments, you might opine. Well, my house was recently listed to rent on TradeMe and in 2 weeks it had been viewed by 2,000 people. Some might say all of these people were Chinese and we should restrict immigration, but TradeMe doesn’t tell me surnames so the issue is unsubstantiated at this point.

My house was ultimately rented to a doctor of 30-ish years who recently emigrated to New Zealand from the U.K. He arrived in NZ with a backpack and a guitar. Despite his relaxed nature, he works night shifts at Auckland City Hospital where he cares for sick children. I think my tenant deserves a house. He seems to like having a house that is warm and dry all year round, and which is 10 minutes walk to his work (if he has to work at Middlemore he’ll use the train). He doesn’t have a car, has no need for parking, and enjoys cycling/walking.

I don’t understand why some people try to stop intensification in Auckland.

Why do people think it’s beneficial to prevent levels of intensification which were perfectly normal in Auckland 100 years ago, when my building (and others nearby) were developed? Levels of intensification which are perfectly normal in cities overseas, like Sydney?

Why do politicians like Denise Krum feel it’s appropriate to describe the draft Unitary Plan as “perverse” and intensification as something which will “break-up and disperse communities”?

Why does Denise and others think it’s acceptable to imply, essentially, that people like me (and my tenants) are socio-economic pathogens who, by inhabiting houses like that shown above, will bring a wave of plague and pestilence to the communities in which we live?

Am I being a tad hyperbolic? Perhaps. Although it’s worth remembering that NZ’s Finance Minister recently used the word “ebola” to describe the strength of views held by people who oppose intensification. While restricting intensification may not be fatal biologically, everything I’ve read suggests it’s fatal to urban socio-economic performance. I don’t think I’m guilty of hubris to say that people like me bring skills, ideas, and money into a city. And maybe some slightly strange clothes and habits. Like coffee habits. Every morning I would stumble 200m to Espresso Workshop down by Britomart to get an excellent coffee served to me by people like me. Only younger and better dressed. Thank you Espresso Workshop.

I’d like to think that if opponents of intensification knew me and my tenants, then they might stop trying to prevent houses like mine from being built. They might even start to accept that it would be a good idea to let people like me to live in the types of houses that *we* prefer. Rather than force us to live in houses that *they* prefer. Houses like the ones which they live in, which have balconies, car-parks, and all manner of expensive bells and whistles.

I hope that by the time I return to Auckland the debate on intensification will have progressed. To be perfectly honest here’s what the debate looks like right now: A bunch of relatively old, wealthy, and scared people have successfully pressured Auckland Council into implementing restrictions on the development of houses designed to accommodate people who have different preferences. What the debate looks like is the opponents of intensification trying to decide how other people should live, with no evidence supporting their positions.

Some might suggest this is “modus operandi” for Auckland, and New Zealand. That we have for many decades allowed the short-term preferences of select suburbs to steamroll the long-term needs of the city. If true, then this might be one explanation for why NZ has developed a systematic “demographic deficit“. As the researchers as the excellent NIDEA (University of Waikato) commented recently (emphasis added):

As elsewhere, New Zealand’s population is ageing. As elsewhere, this ageing has two main drivers: increasing longevity, and declining birth rates, both outcomes of the Demographic Transition. In New Zealand’s case, however, the population is also ageing ‘prematurely’ from another cause, the legacy of net migration loss at young adult ages (typically 20-24 years) which New Zealand experiences in most years, and at 15-19 and 25-29 years in many other years as well. The loss, compounded by the falling birth rates at the time each cohort was born, has created a deep bite in today’s age structure across ages 25-39 years. This bite is not only driving up the median age faster than would otherwise be the case, given that New Zealand has the highest birth rate in the developed world, but has enormous implications for the country as it faces the retirement of its baby boomer generation.

I’m soon moving overseas, where excessive rents from my apartment in Auckland will help fund my lifestyle. Ironic? Yes. Sad? A bit. Unusual? Apparently not.

I can’t help shake the nagging feeling that New Zealand’s most valuable export is not dairy or tourism, but young people. Problem is we don’t get paid for exporting young people. In fact, we invest in them – only for them to live, love, and pay taxes somewhere else. Some come back of course, but what of those who don’t? I know of many people my age who fall into the latter category – indeed I may end up being one. Sorry Mum.

Notwithstanding all this I do like my house, and I actually quite like Auckland. If Auckland is able to move beyond the naysayers and allow intensification in a big way, then in a few years it might be enough to bring me home. If it doesn’t, well in the words of the His Royal Highness, the Prince of Bel Air, “smell ya’ later”.

P.s. Love you Mum.

 

 

The moral case for immigration

In a post several weeks back, I talked about the economic case for immigration and population growth. In it, I hypothesised that:

New Zealand has a strong feedback loop between net migration and economic growth. When growth prospects get worse – as they did in the 1970 and 1980s – it dissuades people from coming here and encourages Kiwis to leave for greener pastures. This in turn worsens growth prospects by sucking consumer demand out of the economy and reducing perceived household wealth (i.e. lowering house prices).

By contrast, good growth prospects tend to attract migrants to New Zealand’s cities and encourage potential emigrants to stay. This in turn leads to a virtuous cycle between higher growth and increased migration.

In my view, building good cities that attract and efficiently accommodate population growth can make us better off by strengthening the agglomeration economies at work in New Zealand’s economy. It can also make us better off in non-economic ways: consider romantic relationships, for example. If you’re young and single (or old and single), you should absolutely prefer more people to be arriving than leaving. The more young, mobile people are staying or arriving in New Zealand cities, the better your odds are of ending up in a good relationship.

However, I don’t think the economic case for immigration is as strong as the “moral” case for immigration. That’s because immigration is one of the most powerful mechanisms for enabling people to lift their incomes and social status. Migration can offer individuals opportunities that they never would have had in their home countries.

I’m going to discuss some economic research on the topic, but first I want to explain why it’s important to me.

Basically, in the 200-400 years in which reasonable data on my ancestors is available, migration has been just about the only thing that has enabled us to have any significant social or income mobility. Ever.

Migration has worked out well for me. Moving back to New Zealand has given me opportunities that I might not have had in the United States. Thus far, I’ve had a more interesting and fulfilling career and I’ve been surrounded by interesting and friendly people while doing it.

Migration also worked out well for my parents and several of their siblings, who left New Zealand in the 1970s and 1980s during the wave of economic destruction caused by collapsing commodity prices and Muldoonist Think Big initiatives. Like many other New Zealanders, they’ve done well overseas.

And, back in the 1840s-1890s, migration to New Zealand opened up opportunities for social mobility and independence to my great-grandparents and great-great-grandparents. In fact, those were just about the first opportunities anyone in my family had to get ahead. If it weren’t for migration, we’d still be lower-middle class in some grim former mill town in northern England.

I’m grateful for the opportunities that migration has offered me and the opportunities that it’s offered to my family. Furthermore, I feel strongly that more people should have similar opportunities. I don’t believe in pulling up the ladder. If some hard-working folks from Nigeria, Guatemala, Bangladesh, Samoa, or wherever want to try their luck moving to an unknown country, I’m all for it. Give them a fair go.

Several recent papers by University of Otago economist Steven Stillman (another immigrant!) and several co-authors help quantify how valuable giving people the opportunity to immigrate can be. Stillman uses evidence from two “migration lotteries” operated by the New Zealand government. Under a programme started in 2002, a small number of Tongans and Samoans randomly selected from a pool of applicants are offered residency in New Zealand.

Evidence from the Tongan migration lottery shows significant improvements in well-being for migrants. Stillman and his co-authors found evidence of:

  • “Very large gains in objective well-being result from migrating to New Zealand (Table 2). The weekly wage of principal applicants rose by NZ$321 (US$200) within a year of first moving which is almost three times the weekly wages of the control group in Tonga (NZ$117).”
  • “More subtle and complex effects on subjective well-being…” After four years, they observed a “very substantial rise in the other components of mental health, of about three points, which is equivalent to one quarter of the wave 2 scores for the control group in Tonga.”

Evidence from the Samoan migration lottery shows that migration can also improve wellbeing for migrants’ families in the old country, at least in the short term. Stillman and his co-authors found that migration increased household consumption and reduced poverty in households that sent migrants to New Zealand, although these effects faded away over time.

In short, even after controlling for self-selection bias (i.e. the fact that migrants tend to have both motivation and resources to migrate), migration seems to make people better off. It doesn’t necessarily work for everyone, but it certainly works for most people.

In my view, the evidence suggests there are good economic and moral arguments for enabling migration, rather than cutting it off in the good times. If we want to manage house price inflation, it would be fairer and more sensible to pursue other policies instead. This could include (but certainly isn’t limited to):

  • Changes to tax policy to harmonise our property taxes with major trading and investment partners – as Stu highlighted, our unusually low property taxes distort people’s investment decisions and push cash into housing
  • Supply-side policies like a revitalised programme of state house construction or urban planning policies that enable people to build more housing in areas that are accessible to jobs and amenities.

What’s your experience with immigration? Remember, you or your ancestors came here relatively recently by boat or by airplane!