Making a difference for housing supply

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Thursday 20 April 2017

Ockham Residential chief executive Helen O’Sullivan

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Central government involvement and infrastructure funding solutions are key to ensuring Auckland’s Mayoral Taskforce on Housing Supply is more than just a talkfest, a panel of experts say.

By Miriam Bell

Auckland’s desperate need for a big increase in housing supply prompted the city’s mayor, Phil Goff, to establish the Taskforce, which first met in February this year.

Goff said Auckland needs to build 13,000 new dwellings a year to meet demand but is building half that – and charged the Taskforce with finding common ground on the issues and making recommendations to resolve the problems.

While the Taskforce is made up of a wide cross-section of participants including property developers, a bank, construction companies and government officials, it meets behind closed doors.

This has left many people wondering what the Taskforce is doing and whether it could end up being simply another talkfest, rather than coming up with practical solutions to an escalating problem.

Last night a panel of experts, two of whom are on the Taskforce, led a discussion on the Taskforce, and the issues it has to address – and whether it can succeed.

Two key points emerged from the discussion with the first, and foremost, being that central government has to be an active part of any proposed solutions.

NZ Institute of Architects president, and Taskforce member, Christina van Bohemen said government engagement with the Taskforce and its recommendations, now and in the future, is fundamental to success.

“Housing is infrastructure but it’s not acknowledged as such. There has not been a lot of government involvement with it, in terms of growth and building. And there are implications from that throughout the country. “

Both van Bohemen and fellow Taskforce member, Ockham Residential chief executive Helen O’Sullivan, were encouraged by the degree of government involvement in the Taskforce to date.

But Urban Design Forum NZ chairperson Graeme Scott was concerned that central government has been captured by other interests and was sceptical of just how much involved it might get.

“One critical problem is that in Auckland we have no other funding streams [distinct from the government], bar rates. And anyone who tampers with rates will be voted out. So how can Auckland fund the infrastructure required for an increase in housing supply?”

The need to find better ways of funding infrastructure was the other key point to emerge from the panel discussion.

Van Bohemen said that effectively addressing housing supply goes beyond simply providing more housing stock.

“It means designing and creating good neighbourhoods and that means thinking about infrastructure like roads, public space, access and light.”

And herein lies the problem: while there are many suggestions on how to fund infrastructure, most of them appear to be controversial.

In its recent urban planning report, the Productivity Commission suggested a number of mechanisms to help councils fund infrastructure, including targeted rates, and the panel pointed to these as possibilities.

Additional panel suggestions were the capturing of value uplift in properties that benefit from new infrastructure and the introduction of a land based tax, which would also discourage land banking.

O’Sullivan said that when it comes to infrastructure funding, it is about changing the thinking around it.

“Transport is a key market consideration for housing. That’s because we can’t have good large scale housing without effective means to move people around.”

That is one of the reasons that facilitating the development of medium density housing in existing brownfield areas, more than greenfield areas, will be key to boosting housing supply and making Auckland a more liveable city.

Such development does not need to be ugly, rather affordable, medium density housing can be well-designed and create good environments, the panel agreed.

However, it was also agreed that, by and large, New Zealanders need to undergo a mind-set change when it comes to dwelling options.

Auckland University urban planning head Lee Beattie said part of the equation was that home buyers need to be more realistic in their expectations.

“Much like our parents’ generations were more modest in their expectations. That might mean having, for example, different expectations around dwelling size or type.”

Auckland’s Unitary Plan; the need for the construction industry to move from a peak and trough model to a more sustainable, long term model; and the tightening up of bank lending for developments were also touched on in the panel discussion.

*The Taskforce is set to meet several times before the release of its report, which is scheduled for May.

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