It’s been a little while since I wrote a “Development Update” post, and a lot has happened since then:
- The final batch of Special Housing Areas was approved.
- Downtown Shopping Centre has closed, and is about to be demolished. Tunnels for the City Rail Link will be built underneath, and the site will be redeveloped as Commercial Bay, an office tower and shopping centre.
- Speaking of the City Rail Link, it’s is now officially under construction.
- My count of homes which are currently “under construction” keeps edging up – it’s now up to 6,000, and that’s just for Auckland apartments and terraces.
- Several major buildings have been completed, including Urba Residences (144 apartments just off K Road), Unilodge on Whitaker (300 student apartments) and VXV Three (offices in Wynyard Quarter). Vinegar Lane keeps ticking away, with Countdown also open as of today.
- A number of new homes are now being marketed, such as NXN Apartments, Nugent Rise, The Eight, Eden Green and The International.
So, quite a bit then, and it’s all in the RCG Development Tracker, along with a host of other information on 700-odd projects.
It all adds up to a pretty big ‘pipeline’ of homes which are recently completed, under construction or being sold off the plans.
The tricky part is that, as I’ve written previously, the construction sector is getting really stretched. That’s worth a post of its own, which will happen in the next week. In the meantime, the government keeps finding it politically convenient to blame the Council for all of Auckland’s problems. Convenient it may be, but it’s not particularly helpful for Aucklanders.
Unfortunately, based on “building consent” numbers, Auckland has actually gone backwards in the last couple of months, in terms of the number of homes approved for building.
9,353 homes were consented in the year to April 2016, down from 9,534 in the year to February. The main reason is that apartment consents are volatile, and have had a couple of bad months. It’s a different picture than the top graph shows – that’s more of a “leading” indicator in a sense, so consents should come back up again.
None of it is enough, though, and if you want a bit more evidence:
- The Auckland Plan target is for the city to build 13,000 homes a year over the next 30 years.
- That includes an average of 10,000 homes a year in the first decade, which started in 2012 so we’re already playing catchup on that. Plus, as per the graph above, Auckland has only ever achieved 10,000 homes a year a few times, and that was when we were building far more apartments than we are currently.
- I’ve recently done some calculations that Auckland needs to build 14,000 homes a year to meet current demand (with immigration at its current high levels).
- We’d need at least 16,000 homes a year if not for the fact that Aucklanders have also been moving to other parts of New Zealand, which partly balances out the immigration from overseas.
- Most economic commentators think Auckland already has a shortage of 20,000 to 50,000 homes, which will take many years to address.
This is a huge challenge, although it probably looks pretty good if you’re a builder!