Govt to make housing more unaffordable

One News reports:

As New Zealand’s hunger for affordable pushes suburbs farther and farther from city centres, the Government announced today it has a plan to shield the nation’s most fertile from development.
Agriculture Minister Damien O’Connor said the need to feed a growing population is “one of the greatest challenges facing the world right now”. 
“Continuing to grow food in the volumes and quality we have come to expect depends on the availability of land and the quality of the soil,” he added.

The biggest factor in house prices is availability of land, and here the Government is saying they want to remove land from the housing market.

As Eric Crampton noted it is easy to import potatoes from overseas, but it is impossible to commute to work from overseas.

Also only 3.1% of NZ’s land is urban. That is one of the lowest in the developed world. Here are some comparisons:

  1. Australia 0.5%
  2. Canada 1.4%
  3. NZ 3.1%
  4. Norway 5.6%
  5. Estonia 6.2%
  6. Finland 6.6%
  7. Sweden 7.6%
  8. Ireland 8.2%
  9. US 8.8%
  10. EU 12.9%
  11. France 15.8%
  12. Germany 17.9%
  13. UK 24.3%
  14. Netherlands 38.0%

So the only two developed countries with less urbanisation are Australia and Canada. And this is because they are both giant countries with huge areas of land that in not fit for habitation. Australia is 35% desert and Canada has massive ares of frozen wasteland.

So worrying about the 3.1% of NZ land being urban area growing slightly is ridiculous.

You know what is the bigger threat to productive NZ land? The Government’s subsidies for planting trees. This is incentivising land to move from productive land that employs people into being converted to forestry blocks in perpetuity.

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