Auckland house consents at five year high

December 17th, 2013 at 2:02 pm by David Farrar

The Herald reports:

Auckland house and apartment building is at a five-year high, with nearly 5700 dwelling consents issued in the year to October.

Geoff Cooper, Auckland Council chief economist, said this was the highest annual figure since 2008 and a 28 per cent increase over the year to October, 2012.

That’s a step in the right direction. You can only lower the pressure on prices by reducing the cost of land and construction, increasing supply and/or reducing demand. Ideally all three.

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15 Responses to “Auckland house consents at five year high”

  1. wikiriwhis business (3,883 comments) says:

    So apart from astronomical lawyer fees you also have to pay for a dwelling consent when buying a home

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  2. wreck1080 (3,852 comments) says:

    i read recently auckland needs 12000 houses a year.

    So, is this a good thing to underbuild by 7k houses?

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  3. burt (8,167 comments) says:

    You can only lower the pressure on prices by reducing the cost of land and construction, increasing supply and/or reducing demand. Ideally all three.

    What about using legislation – just say that the maximum price for a house is say $70K – what could possibly go wrong with such an intervention.

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  4. burt (8,167 comments) says:

    wikiriwhis business

    In relation to housing there are two types of people in NZ – those that pay for everything associated with building or buying a house and those that are paid to live in houses that the other group also pay for.

    Labour want to appeal to as many of the second group as possible – therefore they have forgotten they need a fair number of the first group.

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  5. KiwiGreg (3,246 comments) says:

    “Geoff Cooper, Auckland Council chief economist,” – Auckland City employs 3 economists, about the same as the major banks in NZ. Why???

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  6. burt (8,167 comments) says:

    KiwiGreg

    To help plan spending on spin doctors and QC’s for the Mayor ….

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  7. OneTrack (2,958 comments) says:

    “So, is this a good thing to underbuild by 7k houses?” – Those 7K families currently living under bridges will be upset.

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  8. redqueen (546 comments) says:

    David, did you mean to link the Herald report to your North Korean denunciation…

    I do agree, though, sometimes reading the Herald makes you feel like we live in North Korea :)

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  9. mikemikemikemike (323 comments) says:

    Why do you want to depress house prices DPF? The market is currently deciding what houses are worth. The higher prices of fuel and houses is forcing people to live in outlying areas which is forcing us to start looking at smarter ways to work which is saving the environment and doing all manner of good (pushing working people into areas they wouldn’t normally live).

    I fail to see how this so called housing crisis is a bad thing, except for those first home buyers who have to face the shock of not having their first home in Mt Eden or Grey Lynn.

    Why not make it illegal for anyone over 60 from living within 15kms of the city? this would free up a huge number of houses for those workers close the to the city to be able to cheaply get to and from work. Those old buggers aren’t doing anything anyway, why should they live so close to the city. ;)

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  10. srylands (404 comments) says:

    “The market is currently deciding what houses are worth. ”

    True. I have no problem with markets setting house prices. If New Zealanders have a preference for low quality uninsulated houses because they would rather spend their money on boats, or KFC that’s fine. But I do have a problem with unrepresentative swill local authorities and their officials distorting housing markets by restricting land supply and imposing compliance costs. Our prosperity will be advanced through removing such distortions, and hopefully improving housing quality and/or reducing real price levels.

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  11. OneTrack (2,958 comments) says:

    “unrepresentative swill local authorities and their officials distorting housing markets by restricting land supply and imposing compliance costs”

    But you “will” live in an apartment building above the train station, and you “will” like it. We must save the planet. Now I have explained it all, you will excuse me as it is time for my driver must drop me home at my lifestyle block. Ta Ta.

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  12. Camryn (552 comments) says:

    mikemikemikemike – It would be great if more retired people cashed up and moved away. Obviously we’re not talking about forcing them to, but I do wonder why fewer of them seem to want to than used to be the case. I think it’s because we’re richer than we used to be… retired baby boomers don’t tend to *need* to downsize so they don’t. That’s one of the main reasons there’s a lack of family home supply… empty nest baby boomers are not vacating them into couple-sized homes because they don’t want to and can afford not to.

    At least we’re not in a San Francisco situation where they have active policies to keep the elderly from being forced out of the city by rising rents… with no concern whatsoever for the people with jobs who want to pay those rents but are instead forced to clog the roads commuting from miles away.

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  13. Bob R (1,358 comments) says:

    Reducing demand could easily be achieved – reduce the rate of population growth driven by people moving to NZ. Are there any politicians who have considered this? It seems the Reserve Bank & MBIE appreciate the relationship between immigration and house prices, but politics any steps being taken in this direction.

    “This paper uses a structural vector autoregression model to analyse the relationship
    between migration flows, housing construction and house prices in
    New Zealand. It shows that a net immigration flow equal to one percent of the
    population is associated with an approximately 10 percent increase in house
    prices. This size of this relationship, which has existed since the 1960s”

    Coleman, Andrew M. G. and John Landon-Lane. 2007. “Housing Markets and Migration in New Zealand, 1962-2006,” Reserve Bank Discussion Paper, DP2007/12.

    http://www.rbnz.govt.nz/research/discusspapers/dp07_12.pdf.

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  14. Johnboy (15,864 comments) says:

    Once Cunninglips has finished mastering walking on water I have heard he will be conducting a seance at 12 Fife Lane to resurrect MJ Savage.

    30,000 house’s will then miraculously appear every year until all the poor people each have a main dwelling and a holiday home.

    Capital gains tax will then be introduced to pay for them all! :)

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  15. hj (6,794 comments) says:

    “Wah back in Houston Texas….”

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