Smith on land boundaries

June 11th, 2013 at 9:08 am by David Farrar

Anne Gibson at NZ Herald reports:

Housing Minister wants to break out of its boundaries, saying that without change, ownership dreams are being killed.

“If you put a straitjacket around the city and say only land for residential development is in that defined line, you’re gifting a massive capital gain to those rural land owners,” he said, citing a Flat Bush property bought in 1995 for $890,000 and now on the market for $112 million – a situation he called “obscene”.

Land bankers had been encouraged to hold their parcels and strangle supply, the minister said.

“Because they have a monopoly, they are able to make those sorts of profits and the best way to stop it is to actually create a greater degree of freedom,” he said, citing the housing accord between the Government and city council intended to improve .

“We cannot walk away from the issue that restrictive land supply policies across the world are at the heart of the housing affordability issue,” Dr Smith said.

Land supply is not the only factor, but it is the major factor. Any approach that fails to deal with land supply will be ineffectual.

“They’ve appreciated in value by approximately 20 per cent a year. The cost of capital is going to be about 8 per cent a year. People will stop land-banking when they think we’ve got our regulatory act together between local and central Government and we’re not going to allow that sort of ongoing monopoly of land supply. The land banker had no incentive to do anything,” Dr Smith said.

Exactly.

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49 Responses to “Smith on land boundaries”

  1. alex Masterley (1,498 comments) says:

    I look at the flat bush property with a different perspective.

    a decision made in 1995 has paid off. well done the purchasers I say.

    foresight paying off.

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  2. queenstfarmer (754 comments) says:

    ^ Yes, well done them, no quibble there. But that doesn’t negate what Smith says. It is obscene that artificial, arbitrary policies have strangled supply with the effect of artifically driving up prices as the population grows.

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  3. toms (301 comments) says:

    And we have today’s zombie post frull of zombie facts from David Farrar. I guess the cheque from the property council is in the mail.

    [DPF: 30 demerits.]

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  4. NK (1,124 comments) says:

    I see Tom Semmens has only abuse and slurs to offer. Why don’t you piss off back under your rock.

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  5. kiwi in america (2,466 comments) says:

    Alex
    That private sector land owners seek to exploit artificially high land prices because of restrictive land availability is not the issue. Capitalists have been milking super profits from distortionary legislative restrictions to markets for centuries. Smith has hit the nail on the head – if you remove the legislative boost to land prices by relaxing the MUR then markets will ensure the prices fall. Whilst the various reports such as that from the Productivity Commission have pointed to a variety of contributing factors to high Auckland land values, the underlying cost of land is the highest driver of the costly pricing. You remove the distortion and the prices drop – its not rocket science.

    Socialists would seek to regulate the activities of the land bankers with more intrusive and market distorting regulation – capitalists would simply remove the incentives for monopolistic profits and allow the market to set the price – in this case lower to the benefit of potential new home owners.

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  6. Rick Rowling (823 comments) says:

    The best thing about blogs is getting access to well thought out arguments and counter-arguments, supported by reasoning and evidence, like toms’ excellent effort at 9:28am.

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  7. Alan Wilkinson (1,848 comments) says:

    @toms, I see you still don’t understand that it is the Left and their mad regulations and planners that have made the property owners wealthy. Serious intelligence failure.

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  8. Griff (6,988 comments) says:

    Another cost being inflated is contractors who load massive markup on any work done
    ie sparky supplying fittings at four times the trade cost same with plumber and drainage
    pipe sewage 100mm can be purchased for forty dollars six meters drainlayer charges $140 length
    I sourced entire power board switches etc for 140 sparky charged 180 for one switch.
    We are being ripped by trades monopoly on work done. There is no reasoned approach to labour charges 75 dollars an hour to dig trenches and glue pipe is obscene. Next build i do there Will be no contractors supplying fittings at four times the price. I would do all my own wiring and plumbing except for the monopoly of trades . We should be able to do any work as long as it meets standards not be forced to use monopoly trades

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  9. Alan Wilkinson (1,848 comments) says:

    @Griff, I agree with all that. Also use aliexpress to source stuff direct from China and save hundreds of percent markups from retailers here.

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  10. doggone7 (751 comments) says:

    So Nick Smith thinks it’s obscene that someone makes a fortune playing within the rules so wants to change the rules. The justification I suppose he will say is the “greater good.” If he were the one making the fortune would he want the rules changed? No. So the free market notion is good when it suits you.
    If I’d been a computer-button-pusher gambler working in London 12 years ago making millions legitimately, I’d have been upset if someone changed the rules because they perceived some other “greater good.”

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  11. hj (6,683 comments) says:

    The BNZ Chief Economist’s view on the Auckland House Prices
    3. The government is explicitly aiming to grow Auckland’s population as a means of achieving “agglomeration” benefits for economic growth which accrue from high interaction amongst economic players.
    http://www.davidwhitburn.com/blogs/auckland-house-prices-to-rise-over-10-in-2013/

    Wayne Mapp (12) Says: 
    May 25th, 2013 at 4:03 pm
    One thing is absolutely clear, Auckland will grow to 2.5 million in 30 years. Around the town centers there will be increased density. But in areas where the norm is townhouse and traditional housing there will be huge resistance to multilevel apartments. Mayor Len of course knows this, and the plan will be adjusted to take that sting out. Typically in these exercises you put your maximum position out for consultation to give some space to pull back. Of course some planners may not understand this political nuance, and probably not some councillors (i.e. Anne Hartley, judging by her reported comments at the meeting).
    http://www.kiwiblog.co.nz/2013/05/roughan_on_auckland_rumblings.html/comment-page-1#comment-1147615

    so demand is being pushed by the government whereas according to the Royal Commision on Auckland government the increases will have only a small effect on agglomeration benefits.

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  12. hj (6,683 comments) says:

    “If you put a straitjacket around the city and say only land for residential development is in that defined line, you’re gifting a massive capital gain to those rural land owners,” he said, citing a Flat Bush property bought in 1995 for $890,000 and now on the market for $112 million – a situation he called “obscene”.”
    ………
    It’s clear National is the property investors party.

    PM says ‘no’

    Prime Minister John Key reiterated later a land tax and broader capital gains tax were still off the cards. Asked whether the implementation of one or the other could allow government to reduce income taxes to give people more income to spend, he replied:

    “At the risk of repeating myself from last year, we looked at a land tax, and land taxes, one, reduce the value of land in New Zealand, by definition, and it has an impact on every single homeowner in New Zealand.”

    http://www.interest.co.nz/news/52737/imf-recommends-govt-broaden-capital-gains-tax-base-and-introduce-land-tax-your-view

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  13. MT_Tinman (3,043 comments) says:

    “Land Bankers”. The new paedophiles?

    What a load of bullshit!

    People with brains (and sometimes money – sometimes other people’s money) invest in various things in order to gain a profit at some time – just as many here have invested in MRP shares, not for short term gain but long term.

    If that investment happens to be in land the people in question happen to be taking a bloody big risk, largely the risk that the land will be worth something at a later date.

    Meanwhile they pay rates, upkeep and (where necessary) interest.

    If that investment pays off, exactly the same as those who backed Microsoft, Apple, Trade-me etc., they do very well. If the land drops into the sea, the gummint confiscates it etc. they don’t (unless their skin is brown-ish).

    I agree with DPF and others, the restrictions on land use in NZ must be lifted and the market allowed to set it’s own level.

    I am however getting pissed off with the “Land Bankers” wankers.

    An aside; Would the investors be vilified if their names were Smith, Jones or those from the stone-age?

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  14. Colville (2,166 comments) says:

    Griff @ 9.59

    Total and utter bullshit.

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  15. hj (6,683 comments) says:

    From The Landlord Says:

    Meanwhile the National Party released its immigration policy. You may wonder what this means for the property market. It is clear from research that immigration is one of the key drivers of house price growth.

    The logic is simple. If you import more people into the country, then you need more houses. Supply and demand means that prices are then pushed up, this is particularly so in Auckland.

    While the latest immigration numbers show the number of people coming into New Zealand is starting to rise, the Nat’s policy looks like it wants to increase immigration levels even further. (Although it is unclear what sort of number they are targeting.)

    This policy is, arguably, a plus for people who want house prices to rise. (But may be not so good for first home owners wanting to buy.)

    My guess has always been that property investors lean heavily towards the right rather than the left. (This was made clear in an email newsletter I saw from one developer this week.)

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  16. hj (6,683 comments) says:

    I think the downfall in the Demographia argument is that it has an agenda and that is to prove that there are no limits to economic growth when that is lead by entrepreneurs and free markets. It is no coincidence that they reject peak oil and climate change (pieces of the jigsaw that don’t fit). Bit of a shame they have been allowed to capture the NZ Government.

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  17. Alan Wilkinson (1,848 comments) says:

    @hj, there are no limits to economic growth when it is led by innovation. There are only limits to what we know how to do now.

    Peak oil is a mirage as is CAGW alarmism.

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  18. hj (6,683 comments) says:

    alex Masterley (1,161) Says:
    June 11th, 2013 at 9:17 am

    I look at the flat bush property with a different perspective.

    a decision made in 1995 has paid off. well done the purchasers I say.

    foresight paying off.
    ………
    A society (good government) is supposed to set the rules so that the deserving are rewarded (but not over rewarded) and that the weaker members aren’t taken advantage of. Out in the community a lot of people just contentedly prune the roses while others join Rich Mastery, network and salivate with other members and go out on a killing spree.

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  19. hj (6,683 comments) says:

    Alan Wilkinson (1,553) Says:
    June 11th, 2013 at 11:08 am

    @hj, there are no limits to economic growth when it is led by innovation. There are only limits to what we know how to do now.

    Peak oil is a mirage as is CAGW alarmism.
    ………………..
    For one thing you have the exponential function.
    http://www.youtube.com/watch?v=e_VpyoAXpA8
    and there is more to it than that as demonstrated by the Julian Simon Herman Daly debates.

    On Peak oil, there hasn’t been the dramatic shocks predicted but there has been recession and switching to a million pin pricks rather than large wells = low energy return on energy invested. If that’s innovation on energy it isn’t a golden egg.

    As for CAGW alarmism I’ll ignore the chinks in it’s armour until something substantial blows it’s socks off…. doesn’t seem to be happening.

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  20. alex Masterley (1,498 comments) says:

    hj,
    it is a dog eat dog world out here.
    get used to it.

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  21. dime (9,648 comments) says:

    I have made two mortgage payments on the new rental.

    So far my capital gain has been 60k. Minimum.

    Great for me but just absolutely fucking wrong.

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  22. Griff (6,988 comments) says:

    Trade colvill
    i have the fucken bills to prove it
    fucken sparky Will be pissed as i am not paying his.
    180 for one 16 amp rcd
    i paid
    140 for a complete water proof power board including eight fuse and one rcd.
    Fuck off rippoff trades. You are paid a high hourly rate then screw punters on fittings.
    Drainlyers are even worse.
    Builder with complete kit worth around thirty grand=45hour
    sparky with a screwdriver and a pair of cutters 75hour/Drainlyers with a shovel and a bottle of glue/75hour
    My build cost minus the rippoff plumber Drainlyers and sparky =$ 1000/m Add the rippoff trades and its gone over 1300 and i supplied most hardware and run the wires and pipes!

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  23. dime (9,648 comments) says:

    Griff – if only you had friends bahahahaha

    How old are you? You don’t at least have a guy for that? Someone who won’t rip you off.

    It’s not too late to change. Become likeable..

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  24. b1gdaddynz (279 comments) says:

    Increase land supply and reduce the consenting process/cost and that will go a long way to reducing the costs of housing. No one will do it though because it will alienate most homeowners as it will likely reduce the house prices overall; the loss of votes is too unpalatable so there isn’t any political will. Material margin in the new housing sector is at an all time low from building supply retailers so don’t expect pressure there to bring the cost down anytime soon. As for Tradesmen putting ridiculous mark-ups on materials quite frankly that is bs or you must be accepting the first price you get!

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  25. Alan Wilkinson (1,848 comments) says:

    @hj, re CAGW – what part of epic failure don’t you understand:

    http://www.globalwarming.org/2013/06/10/climate-models-epic-failure-or-spot-on-consistent-with-observed-warming/
    http://wattsupwiththat.com/2013/06/09/are-we-in-a-pause-or-a-decline-now-includes-at-least-april-data/

    Re limits to growth, if India and China can be self-sufficient in food we are a long way from population limits and most developed countries have birth rates below replacement levels.

    Peak oil – often predicted, never seen. Too much energy floating around in the universe providing infinite options for utilisation.

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  26. hj (6,683 comments) says:

    MT_Tinman (2,275) Says:

    If that investment happens to be in land the people in question happen to be taking a bloody big risk, largely the risk that the land will be worth something at a later date.

    Meanwhile they pay rates, upkeep and (where necessary) interest.
    ………….
    but that’s where (as an industry) lobbying and political patronage come in:

    “Creating wealth, security and financial freedom is often an investor’s ultimate goal. 90% of millionaires get there by investing in real-estate”

    New Zealand has strong population growth due to its progressive immigration policy and birth rates. Many parts of the country are experiencing housing shortages translating into strong tenant demand and price growth. This trend is expected to continue with recent population projections by the New Zealand Department of Statistics forecasting up to 64% growth over the next 17 years. Auckland city is predicted to almost double its population in the next 40 years. For property investors, this represents outstanding potential growth in demand and return on investment. New Zealand’s property prices are also relatively undervalued compared to its closest neighbour Australia.
    http://www.nzps.com/

    Does anyone believe for a moment that National (and Labour) are not lobbied on this?

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  27. Alan Wilkinson (1,848 comments) says:

    @b1gdaddynz, not necessarily the tradesmen’s markups but theirs come on top of the retailers which can be huge. I was just looking at some electrical connectors retailing at $45 available elsewhere for $10. I bought brass solenoid valves for $75 retailing for $400. The internet is your friend. Trade suppliers are not.

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  28. b1gdaddynz (279 comments) says:

    Alan Wilkinson- While I can’t speak for electrical or plumbing retailers; I am a building supplies (Timber, Gib etc) retailer and it is a very tough market at the moment!

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  29. Colville (2,166 comments) says:

    Its not hard to ask any trade what markup they put on materials and agree up front …. and the agreed markup goes on cost not trade price. Elec wholesalers will give 65% discount off trade. Do your homework and stop the whine.

    A drainlayer has a couple of diggers and a low loader and a couple of trucks … there are a lot who comment on here wouldnt get out of bed for $75/hr.

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  30. s.russell (1,580 comments) says:

    Labour and the Greens should be praised for spotting a serious problem and trying to come up with a policy to address the issue. And they should be damned for coming up with an idiotic scheme which treats the symptoms without addressing the root cause of the problem. The one big positive from their scheme is that it has stimulated the Govt to appoint a housing minister with some ideas and energy, and to begin to take some real action to address those root causes.

    MT_Tinman,
    I do not see anyone here vilifying the land bankers. They have reacted rationally and legally to Govt policy. It is the policy which deserves to be vilified.

    b1gdaddynz,
    You are right that politicians do not want a collapse in land prices. That would be politically bad, and bad for the economy too. The trick is to calibrate policy to bring an end to the rapid rise in land/house values without triggering a collapse. The best outcome for the country would be a long period of land/house values rising, but below the rate of GDP per capita growth. That way owners are not hammered, but prices can gradually come into a better alignment with incomes.

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  31. mikenmild (11,246 comments) says:

    Would a land tax and/or a capital gains tax play any useful role in limiting land-banking?

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  32. kiwi in america (2,466 comments) says:

    hj
    Phoenix and Houston double in size about every 15 – 20 years without an explosion in property prices – both cities are very affordable compared to Auckland and yet grow at twice or more the rate of Auckland. Immigration is not the issue – land supply is. Phoenix and Houston don’t restrict the supply of new land so prices are lower. As I said earlier its not rocket science.

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  33. Alan Wilkinson (1,848 comments) says:

    @Colville, 65% discounts off trade show what kind of retail margins are common. I know two Aussie builders who have separately told me how shocked they are at the price of materials here.

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  34. Griff (6,988 comments) says:

    I am not dealing with my normal sources
    I just built a batch up north.
    The trades up here rippoff Auckland people.
    Mangawai is full of rippoff . Waipu trades are far better less reliant on the ex Auckland batch market.
    As to negotiating I supplied all fittings and asked the sparky to tell me if any more were required
    he swaped the supplied fittings for ones he purchased from the local trade supply when I was busy elsewhere.
    I Will pay his labour not his hardware bill if he does not like this he can pay for my fittings to be installed by another sparky.
    The drainlayer did not use a digger I dug the trenches by hand.
    Seventy five dollars an hour for a man with a pot of glue and shovel is a rippoff. Joining pipe is not a trade its a labouring job as is most drainlayer work.
    Anyone with half a clue can wire and drain.the only way they keep the monopoly going is capture of legislation that makes impossible to not use trades.

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  35. hj (6,683 comments) says:

    Alan Wilkinson (1,556) Says:
    June 11th, 2013 at 11:33 am

    @hj, re CAGW – what part of epic failure don’t you understand:
    ……………………..
    As I said your AGW links are famous amongst a certain section of the public but I don’t see that breaking into the mainstream scientific community.

    “India and China are self sufficient”.
    http://world.time.com/2013/05/27/fears-grow-of-a-himalayan-tsunami-as-glaciers-melt/

    “Many Chinese want to escape “the intensity of the urban population”. In many cities there is a lack of personal space and the presence of smog, making a trip to New Zealand feel like an out-of-this-world experience. ”
    http://www.stuff.co.nz/business/industries/8602673/Building-the-Chinese-connection

    Do we want to replicate that here?

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  36. Bob R (1,355 comments) says:

    You could also stop increasing the size of the population by reducing immigration levels. Why not try that?

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  37. hj (6,683 comments) says:

    kiwi in america (1,904) Says:

    Phoenix and Houston double in size about every 15 – 20 years without an explosion in property prices – both cities are very affordable compared to Auckland and yet grow at twice or more the rate of Auckland.
    …………..

    The immigrants are Americans moving about in the U.S which should make the places they leave from more affordable?

    Auckland is on an isumus.
    The Albert Saiz paper Geographical Determinants of housing Supply demonstrates well the relationships between geography and ability of housing markets to respond to demand.
    http://real.wharton.upenn.edu/~saiz/GEOGRAPHIC%20DETERMINANTS.pdf

    The other thing about Houston model is that the infrastructure represents wastefulness as it decays and requires large amounts of energy to function. As a model it compares to building cheap uninsulated houses because we believe an energy revolution is just around the corner.

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  38. hj (6,683 comments) says:

    One thing I noticed about builders was when I had a helicopter pad built on the roof. I went and bought cakes. The heli-pad team never came in (not sure where they took a pee). The team leader was a stressed out young guy. Gone are the days when the old plumber came for a cup of tea and said “bloody worlds in a mess!”

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  39. Alan Wilkinson (1,848 comments) says:

    hj: “I don’t see that breaking into the mainstream scientific community”

    Why would they kill the goose that provides their gold? However, plenty of important mainstream science papers that don’t follow the IPCC party line nowadays. You just don’t get them written up by the MSM tame Lefty journalists.

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  40. Griff (6,988 comments) says:

    Peak oil has come and gone
    tar sands and fracking represent increasing energy expenditure to extract energy.
    Eventually hydrocarbons Will run out
    when this happens our civilization is in trouble
    we don’t have replacement technology to transport goods
    failure of supply chain due to transport costs rising as oil supply reduces Will become a significant problem in the medium term
    Often people place faith on our ability to resolve this issue
    this faith has no evidence to support it.
    I don’t see any emerging technology that can resolve this conumdrum.

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  41. Lance (2,554 comments) says:

    @Griff
    “Anybody can wire”

    Sorry mate but you are talking out your arse there.
    Electricity is fucking dangerous and needs trained people to do it. You might not like that and you probably should shop around but to vent your frustration by saying anybody can wire, without training, then you are speaking as an ignorant person and to do so would be playing with instant death.
    Contacting mains can kill in milliseconds, blow chunks out of your flesh, burn or blind.

    You are allowed under NZ regs to drill the holes, run the wire etc then have a qualified electrician sign it off, thats o.k. So long as it’s your own house.

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  42. Griff (6,988 comments) says:

    Wiring is not hard
    I run a boat with a very complex hybrid electrical generation and monitoring systems all installed by me.
    piece of piss red and black +- house wiring is far simpler to install and maintain.neutral phase and earth is only one more wire
    It does not take four years of study to ..learn wiring its basic shit.
    There is nothing in a standard house that needs years of training just run the wire and watch the possible loads on any given circumstances.
    Far more complex in my boat with controllers for wind solar and alternaor power plus monitoring circuts Add in twenty or so thousand of expensive electronic boxes like gps ssb depth sounder autopilot radar wind instruments a heartinterface inverter charger again with monitoring and charging parameters plus load switching.
    Not hard if you have enough brains not to eat yourself.

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  43. kiwi in america (2,466 comments) says:

    hj
    Much of Auckland’s growth is from internal migration – frankly what does it matter whether the growth is from internal or external migration – cities with less restrictive land policies manage high growth better regardless of the domestic region or international country it’s new residents move from.

    The old part of Auckland is indeed well restricted by the isthmus layout but Auckland has substantial greenfields potential to the north and the south that exert few physical barriers to expansion – the barriers right now are legislative and ideological. Houston has a coastline similar to Christchurch that acts as some natural barrier to expansion – likewise Phoenix has substantial hills on 3 sides of the Valley that are State or City Parks that cannot be built on. Relatively loose land policies in the rest of Maricopa County and aggressive forward thinking construction and expansion of freeways to accommodate high growth and urban sprawl make the greater Phoenix area (which is the size of NZ) one of the easiest large cities in the world to travel around. Having recently travelled to Auckland on business and having to get from Penrose to Northcote at 4pm was a journey that took me 1 hour + to complete – traversing the same distance at 4pm across the heart of Phoenix would take take me 20 minutes to complete!

    Auckland can gradually become affordable with the right policies but it will never happen with the Len Brown, Labour or Green solutions proposed because they are wedded to the failed smart growth ideology and market distorting interferences in the housing market.

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  44. hj (6,683 comments) says:

    Cities where suburban poverty is skyrocketing:

    More than 780,000 people lived below the poverty line in the Atlanta suburbs in 2011 — a nearly 159% increase from the year 2000. The Atlanta area has been one of the fastest-growing in the nation, with the metro population rising 24% between 2000 and 2010. This was concentrated almost entirely in the suburbs, where the population grew by 26%, versus just 0.2% for the city itself. At the end of 2011, 88% of all the area’s residents living below the poverty lived in the suburbs — the largest proportion of any large metro area in the nation. According to the Brookings Institution’s Kneebone, “as people came to the region, the region continued to grow, and then the housing market collapsed.” As a result many people now living in the suburbs were hit particularly hard by the housing crisis. As of the first quarter of 2013, home prices in Atlanta were down by more than 23% from five years before.

    Read more: Cities Where Suburban Poverty Is Skyrocketing – 24/7 Wall St. http://247wallst.com/2013/05/28/cities-where-suburban-poverty-is-skyrocketing/#ixzz2VsuzauhD

    of course that wont happen to Aucklands Kiwis (thanks to agglomeration – National’s hot idea)!

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  45. hj (6,683 comments) says:

    Market Median Housing Price Median Income Median Multiple
    Detroit $66,500 $48,700 1.4
    Atlanta $101,900 $53,800 1.9
    Phoenix $113,700 $50,900 2.2
    Cincinnati $126,800 $52,100 2.4
    Cleveland $113,600 $46,700 2.4
    Las Vegas $122,700 $52,000 2.4
    Rochester $123,400 $50,800 2.4
    Columbus $131,500 $51,600 2.5
    Kansas City $135,900 $54,500 2.5
    Minneapolis-St. Paul $160,300 $63,100 2.5

    http://www.theatlanticcities.com/housing/2012/01/most-and-least-affordable-housing-america/1035/
    so what was that about affordability being behind a healthy economy?

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  46. hj (6,683 comments) says:

    Remember Kiwi in America you have to build extra houses needed now but also for all the newcomers the national party is inviting in (a million or something)… and do the cost down thing.

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  47. kiwi in america (2,466 comments) says:

    hj
    Poverty levels in US cities (which vary a lot) have little to do with housing prices. Are you trying to infer that there is higher poverty in Atlanta because it has low house prices? There is no such correlation. You have proferred a number of excuses for Auckland’s special case – none hold water. Auckland has high property values because it has restrictive land policies that force up the price of sections, excessive regulatory costs and impositions that are passed onto the home buyer and over priced materials. The first two of these are quite easily fixed and it’s pleasing to see be new Minister of Housing heading in the direction of fixing these underlying issues.

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  48. Viking2 (11,244 comments) says:

    The Auckland Council now appears to be circling its wagons, while Housing Minister Nick Smith is demonstrating the kind of dogma this Government is becoming far too readily associated with.

    In reality, the bill as it stands is far too much far too soon. When the Government announced it had developed an Auckland Housing Accord with the Auckland Council last month (see housing accord articles here) the indication was that the legislation introduced into Parliament following the Budget would be simply to enact the accord.

    But the legislation isn’t simple and it doesn’t just enact the Auckland accord. In fact there is not much reference to Auckland at all. Nick Smith has gone gallivanting off, like Rambo looking for his jockstrap, and produced some hastily pulled together legislation that could potentially neuter a big part of the what this country’s local governments currently

    http://www.interest.co.nz/opinion/64864/opinion-government-should-withdraw-its-housing-accords-legislation-favour-new-bill-wou

    Smith about to melt down once more.

    I am perplexed about this issue. I have not seen any vociferous noisy reports of people sleeping in cars, families living 30 to a garage, army style tent villages on Auclands parks or any noise of this sort and if we were that short of housing as is suggested then we would be seeing this shit vevery night as lead items on the news (rather than the mindless crap TV1 posted tonight. Thought they had lost their newsmaker!).

    The argument goes that Auckland is short of 30k + houses. Well where the fuck are the near 100 thousand people that would inhabit those houses if that’s so? As I said where are the tent cities?

    Its a beat up and a nonsense scare moingering garbage to propose that auckland is so short of housing and that this is causing the price of housing to go up. Its also been around for three years at least. Its demonstrable rubbish.

    The same applies to Tauranga. There is no housing shortage, there is no land or section shortage but there is a group of noisy people expecting to purchase assets at a cheap price.

    Bob Jones once made the point that new construction of office building won’t be undertaken until the price of second hand building approaches the cost of new. And that’s all that’s happening.

    People pay the price they want for houses. If they don’t want to they have to buy elsewhere. NO ONE twists their arms or holds a gun to their head.
    Unless you move the schools and workplaces then they will continue to pay what they have to, to live where they want. Simple stuff and no amount of whinging, hand wringing nor govt. intervention will change what people pay for where they want to be. All that will happen is the usual poor bastards called the taxpayer and the rate payer will be suckered again for more.

    Here’s what will make a difference.
    1. Make councils more accountable to their citizens. At the moment rates are paid by a small number of citiczens. Change the Residential Tenancies Act to allow Landlords to pass rates onto the tenants. That will have the effect of making all those that contribute nothing to councils to sit up and take notice of the wanton spending of what then becomes their money.
    It also has the benefit of shifting the vote. Labour spends like it’s not theirs and that effects their voters if you change the contribution. You will hear them wailing.

    2. Reconstruct councils down to policy makers only. Out source stuff they do to more efficient people. Move much more to user pays.
    I have yet to see any justification for council paying people to run walking buses programs and all the bullshit stuff they do.

    Will it happen, hell no. Smith and his kind couldn’t do without the gravy.

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  49. campit (467 comments) says:

    Land supply is not the only factor, but it is the major factor. Any approach that fails to deal with land supply will be ineffectual.

    And again I point out to you that the Unitary Plan allows for 30 – 40% of all new dwellings to be built outside of the current MUL. And Nick Smith is yet to produce any evidence whatsoever that opening up land on the fringes will lead to more affordable housing.

    As for land bankers, whether there is a formal MUL or not, it won’t stop the practice of buying land just outside of where urban development stops in the hope of the land being rezoned. Like this block of land in Dairy Flat for instance:

    http://www.premium.co.nz/22332/

    Or are you saying that there should be no restrictions at all on the density of housing, anywhere in Auckland?

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