Councillor Sayers call for more sprawl defies what market is doing
The latest housing figures are in from Auckland Council:
Auckland Monthly Housing Update for January
Auckland Council’s Research and Evaluation Unit (RIMU) has released its Monthly Housing Update for January, bringing together the latest significant Auckland housing-related statistics.
Key findings:
- 1172 dwellings received building consents in November.
- In the year ending November 2018, 12,800 dwellings were granted building consents in the region.
- 52 per cent of new dwellings consented in November 2018 were houses, 15 per cent were apartments and 33 per cent were townhouses, flats, units, retirement units, or other types of dwellings.
- 82 per cent of dwellings consented in November 2018 were inside the 2010 MUL. Over the past 12 months, 82 per cent of new dwellings consented were inside the 2010 MUL.
- 887 dwellings were ‘completed’ by having a Code Compliance Certificate (CCC) issued in November 2018.
- In the year ending November 2018, 10,475 dwellings were issued with a CCC.
The full report can be found on Knowledge Auckland here.
Commentary from Auckland Council Chief Economist David Norman:
“New dwellings consented in November 2018 were down sharply on November 2017 figures. This was because of the spike in consents in November 2017, when 1,450 new dwellings were approved.
“This November, a strong, but more modest 1,172 dwellings were consented. But as the November 2017 figures drop out of the annual total, annual consents dipped a little to 12,800 for the year to November 2018. This is nevertheless up 19 per cent in a year, off an already-strong base.”
Ends
It is the Code of Compliance Certificate that measures a dwelling all ready to go and be moved into by its new residents. If the CCC figures are strong and keeping pace with population growth then the housing sector is doing okay, if the CCC figures languish behind population growth we get deficits seen over the last two decades.
I also again note that most residential dwelling builds are inside the existing urban area or otherwise known as Brownfield developments. This is due to both the Unitary Plan making intensification easier as well as people demanding being closer to amenities including transport routes and Centres (like a town or Metropolitan Centre). This does not remove Greenfield development (sprawl) entirely but it does prove that Councillor Sayers call for releasing more land (sprawl) than already programmed in the Auckland and Unitary Plans would be foolish given where current demand is (Brownfield).
Issues of price are better dealt with via the construction sector and the problem of wages rather than going unfettered on sprawl.
None-the-less we need to be mindful of how our residential areas are developed. Mixed Use would be preferable than single use that would otherwise encourage travel for basic amenities that Mixed Use (residential and commercial together) would mitigate. (See: Affordable Housing – A Presentation on Typology and How We Can Not Forget Transport in the Affordability Equation)
Talking Southern Auckland 
Ben, you can’t claim the market demands only urban intensification when it is not permitted to expand. People don’t have the genuine freedom to choose.
When land markets are so uncompetitive because urban development capacity is so constrained, lowering construction prices and increasing wages won’t improve housing affordability. It will increase land prices by an almost equal measure, as that’s the factor in scarcest supply. I can point you to specific bits of the academic literature if that’d help.
Lowering construction prices only (with no urban expansion) would increase housing affordability only if there was a competitive supply of development capacity. Competition requires little barriers to any development, low capacity constraints, and relatively homogeneous development markets. This could occur through only intensification if:
-zoning was extremely flexible, Japanese-style; and
-transport networks had ample capacity/weren’t congested; and
-jobs could freely disperse throughout the existing metropolitan area; and
-the transport accessibility and job dispersion enabled developing in any one part of the metro nearly as attractive as in any other part.
That would require NZ property owners to give up most of their current property rights without compensation. They wouldn’t be able to jointly regulate themselves to maintain their property values (through zoning or deed restrictions), and infrastructure providers would need liberal powers to compulsorily take people’s land to redevelop on, Japanese-style.
Afternoon Chris
Thank you for you extensive comment. I will reply in full later in the day but in short expansion is possible – through the Future Urban Zones that the Auckland and Unitary Plans have made available.
If a developer or consumer demand is demanding Greenfield development the processes are in place to flip the FUZ into a live urban zone via a Public or Private Land Change. This is being done with Auranga, North West, Silverdale and Drury South.
Construction aside I would wager consumer demand being closer to transit nodes and employment centres is top of mind (I have a survey report on this somewhere) and paying the premium to do so compared to being stuck on the Southern Motorway between Drury and Auckland each day.
As I said I’ll reply in full later in the day.
Hi Ben Thanks for the update. Can you keep us informed on the march 2019 end of year figure?
Will do once it is out 🙂
Hi Ben. Thanks for this. Interesting ..but the Council are still short of the 15,000 house per annum that Mayor Phil Gough promised the Minister Phil Twyford. I understand that harsh words were said over that performance last year. I believe that the figure is now more than 17,000 dwelling units per annum to catch up ?. So Auckland may have the new / proposed Urban Planning Authority processing all of its planning and building consents in 2020….Not the Council… You may know more than I do on this
I checked with Council and as of late last year our consenting and CCC’s were keeping pace with population growth. HOWEVER, and this is the big one housing builds were not ahead of growth so that means the big housing deficit from the National administration still exists – it is not being cleared.
Once the full year figures are in we will get a better gauge if housing did keep pace with growth and made inroads in clearing the deficit (I highly doubt either at the moment).
As for the UDA? Not sure as that is like NZTA is with light rail right now in bunker mode. Not much info and beset with delays.