Auckland faces major changes to housing

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Auckland, June 12, 2017

The Auckland Mayoral Housing Taskforce released today its report to the Mayor, outlining major changes needed to address the city’s serious housing shortage.

The Taskforce was set up by Mayor Phil Goff early this year with a Terms of Reference asking it to identify barriers and constraints to building new homes in Auckland at a speed and scale needed to meet the demand caused by population growth.

The Taskforce membership brought together developers, builders, bankers, economists, architects and central and local government officials.

Mayor Phil Goff welcomed the Report.

The following is his statement.

Strategic changes

This Report sets out strategic changes needed to address Auckland’s housing crisis.

It is important for central and local government and the industry to analyse and respond to the Report’s recommendations.

Auckland has become unaffordable for first home buyers and renters.

Unless we address these problems, housing shortage and unaffordability in Auckland will not only continue to cause serious social pressures, but will also hold back Auckland’s and New Zealand’s economic growth,” he said.

Key development areas

The Report makes recommendations in three key areas: (a) developing at scale which includes building through the dips (b) unlocking the availability of land with appropriate zoning and infrastructure; and (c) enabling efficiency and innovation in consenting and risk management.

Firstly, the Report says that unless we can provide greater continuity and certainty in building work, the industry will not scale up sufficiently and we will continue to build fewer houses than needed.

It recommends a deliberate policy to build through the economic dips.

In a small country like New Zealand, central government has in the past played a key role and needs to today as well. It also recommends ways to tackle skills shortages that create constraints and cost pressures.

Funding constraints

Secondly, the Report emphasises the constraints created by shortage of funding to invest in the infrastructure needed for development to occur.

The Auckland Unitary Plan has freed up land by zoning it for development. However, for development to take place roading, water and community facilities need to be provided in order for the build to occur.

The Report addresses the role that the Housing Infrastructure Fund must play in allowing this to happen in Auckland and recommends the broadening of revenue sources for Council including road pricing and devolution of funds from central government.

It promotes the potential to use other sources of funding such as targeted rates on those realising windfall profits from rezoning and new infrastructure so they contribute to the cost of that infrastructure.

It raises concerns that changes in lending policies from banks and regulatory agencies could start to act as a drag on construction.

Risk Management

Thirdly, the Report makes a series of recommendations on consenting and risk management to facilitate housing being put in place.

It recommends a warranty and insurance scheme to give assurance to consumers and to allow Council to be more supportive of innovation in building methods.

It calls for the Consenting Made Easy process being trailed by Council to be fully implemented, and also says the Building Code and other legislation such as the Unit Titles Act requires an update.

Also noted in the Report is the advantage of innovation such as prefabrication to improve the speed and quality of construction and lowering costs.

It points a way forward to better tackle the problem of housing shortage and affordability which Aucklanders and New Zealanders have signalled are major problems calling for new approaches.

This Report reflects the consensus findings of a cross-section of individuals representing groups across the housing industry. It deserves the close attention of central and local government.

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