This is the second post in an ongoing series on the politics and economic of zoning reform. The first part looked at the costs, benefits, and distributional impacts of reforming urban planning rules to enable more development. This part takes a more specific look at the most recent reform to Auckland’s planning system: the Unitary Plan.

Now that the hearings are over, the submitters have been heard, and the politicians have voted, it’s worth asking: What have we gotten from the Unitary Plan? Does it take us in a useful direction, and to what degree?

In order to give a coherent answer to this question, I’m going to have to simplify matters. The UP does a lot to regulate development and local environmental issues – addressing everything from air quality to zoning for factors. But it has the strongest effects are on the city’s housing market. The UP shapes how much housing can be built, where it can be built, and how easy it is to get permission to build it.

Consequently, I’m going to focus on the impact of the Unitary Plan on people’s ability to build more homes in the city. Zoning capacity isn’t the only thing that matters, but it’s important. Cities that have “downzoned” severely, like Los Angeles in the 1970s and 80s, typically experience rising housing prices, while cities that “upzone” significantly, like Tokyo in the 1990s, tend to have an easier time keeping prices under control.

The great down-zoning of LA (Morrow, 2013)

In order to estimate the UP’s impact on Auckland’s capacity to build more homes, I’m going to draw upon “capacity for growth” modelling produced by Auckland Council and subsequently updated throughout the hearings process. As changes to the modelling methodology make a like-for-like comparison a bit difficult, I’m going to have to piece together the overall results.

The 2012 Capacity for Growth Study estimated the number of homes that could be built under the legacy zoning rules that were put in place prior to Auckland Council amalgamation. The modellers estimated a measure of “plan-enabled capacity” – i.e. the total quantity of housing that could be built within the city if everyone (re)developed their site to the maximum permitted under the zoning rules.

This is obviously an implausible scenario, as many people won’t choose to redevelop, at least for a while. So the results are best thought of as a theoretical upper bound rather than a realistic estimate of what would happen in practice. As we’ll see, this was addressed in subsequent modelling undertaken during the hearings.

With that caveat in mind, the modellers found that the legacy zoning rules allowed between 250,000 and 345,000 additional dwellings to be built in Auckland. The lower number reflects the maximum capacity for infill development, while the higher number reflects the maximum capacity for redeveloping residential sites.

The 2013 Capacity for Growth Study used the same methodology to assess the version of the UP that was notified by Auckland Council after consultation on the plan. This showed that the notified UP had only made incremental increases to infill and redevelopment capacity within the city.

The modellers found that the legacy zoning rules allowed between 258,000 and 417,000 additional dwellings to be built in Auckland. The lower number reflects infill capacity, while the higher figure reflects redevelopment capacity. However, it also noted future greenfield areas with capacity for around 90,000 additional dwellings.

Taking the greenfield areas into account, the notified UP would have delivered a 39-47% increase in capacity for housing, relative to the legacy zoning. That difference is shown in the following diagram. Essentially, the Unitary Plan as originally conceived would have been at most an incremental improvement.

CfGS legacy plans and notified UP chart

Things get a bit more complex when comparing between the notified UP and the final version of the UP that was recommended by the Independent Hearings Panel and approved (with minor tweaks) by Auckland Council. The modelling methodology changed in the course of the hearings, with the focus shifting from “plan-enabled” capacity to “commercially feasible” capacity. In effect, a new model was built to filter out sites that wouldn’t be profitable to develop.

The result was the final numbers presented in the Independent Hearings Panel’s report (and covered, somewhat hyperbolically, by the Spinoff) are lower – but considerably more realistic – than the figures reported in the Capacity for Growth Studies.

You can see that in the following chart. The commercially feasible capacity enabled by the notified UP is 213,000 additional dwellings – only 42% of the full plan-enabled capacity.

The key thing in this chart is the change between the notified UP and the final UP. Feasible capacity has increased from 213,000 to 422,000 dwellings, or a 98% increase. Most of the increase in capacity comes from within existing residential zones, thanks to rezoning and changes to zoning rules to allow people to build more dwellings on the same amount of land.

Recomended UP - Change in Feasible Capacity

So if we squint a bit, we can put these estimates together to get a rough picture of the overall outcome:

  • The notified UP increased plan-enabled capacity by 39-47% relative to the legacy plans
  • The final UP increased feasible capacity by 98% relative to the notified UP
  • This implies that the final UP has increased the zoning envelope by around 175-190%, relative to the legacy plans (i.e. 1.98*1.39 to 1.98*1.47).

Equivalently, if we assume that only around 42% of the plan-enabled capacity under the legacy zoning plans would be commercially feasible (a similar ratio to the notified UP), we can put together the following chart:

Feasible capacity legacy plans and Unitary Plan chart

Is this sufficient? Time will tell. Getting housing, transport, and place-making right for Auckland doesn’t end with a planning rulebook. But the final UP is undoubtedly a large step away from the broken status quo.

As this is a series on the economics and politics of zoning reform, I want to close with a few simple observations that arise from the quantitative analysis in this post.

  • The incremental changes observed between the legacy plans and the notified UP reflect the outcome of a political process. Council put out a draft plan for consultation, and then pulled back a lot of the changes in response to criticism.
  • The considerably larger changes between the notified UP and the final UP arose from a technical process – the independent hearings.
  • Although the IHP recommended, councillors decided. The final UP was voted up by many of the same councillors who had pulled back to a more conservative position three years before.

This in turn raises two questions that I will revisit in future posts in this series. First, why did the political process deliver a more conservative outcome than the technical process? And second, what changed between 2013 and 2016 to obtain a different outcome from the council votes on the plan?

What do you make of these figures?

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  1. The document you pulled those feasible capacity graphs from also has total capacity information if you look closely enough.

    In terms of what changed between 2013 and 2016, I think it’s more what changed between that notorious February 2016 meeting and August.

    Main reason: housing crisis finally got media coverage.

    1. Thanks for that. I’ve heard the 1m figure going around but I obviously didn’t read the IHP’s report closely enough. It gets us to the same conclusion – that the final UP provides about 3x as much capacity as the legacy plans.

  2. What do you make of these figures?

    1) The Unitary Plan is a huge step change in the right direction
    2) Next challenge is the Auckland Plan redraw next year
    3) Government continues to utterly fail in transport and housing (then again the opposition doesnt leave much hope either apart from the Greens)
    4) Whether intentional or not the Unitary Plan has created three distinct sub regions within Auckland in terms of development and future

    1. Here’s hoping the new Auckland Plan actually sets specific outcome targets and feasible mechanisms to achieve them, rather than being (as was the case with the last one) solution-captured.

        1. I’d think a suite of the following output and outcome measures would be more suitable
          Housing: house prices to be no more than x multiples of income
          Consenting: 99% of all building consents within 15 statutory working days (rather than 20), 99% of all resource consents within 15 statutory working days (rather than 20) – then fund this
          Traffic: reduction in average commuting time by x minutes
          Traffic: 99% of all complaints about illegal parking responded to within 15 minutes (with an associated measure of reduced reported illegal parking)
          Noise: 99% of all noise complaints responded to within 15 minutes

          The Council has got away with a lack of specificity for two long, because people focus too much on its enabling (e.g. Unitary Plan) rather than its service delivery (e.g. rubbish pickup) areas,

          It’s really simple. Don’t tell us how many parks you’re going to build, how many metres of buslanes you’re going to paint, tell us what the result will be.

        2. “Traffic: reduction in average commuting time by x minutes”

          Perhaps you haven’t heard of Marchetti’s constant or induced demand, Zhivan.

          I agree with your general argument that public sector bodies should be outcome-focused rather than output-focused, but most of your proposed targets are in fact output measures. For instance, “99% of all noise complaints responded to within 15 minutes” is an output measure. It refers directly to the *activity* undertaken by council, rather than the end outcome of delivering that output, which is (presumably) better sleep for affected neighbours.

  3. Yes so the final UP has a theoretical supply of well over a million dwellings, according to Penny Pirret the lead Council planner, that is if absolutely everything was built everywhere to its maximum allowable capacity (which of course won’t happen). That does give some credibility to the 400k+ figure as actually being possible, if of course the demand is there.

    And I agree Brian about the ‘notorious Feb meeting’, and am pleased to say I did call that moment as ‘peak NIMBY’ at the time. Penny Hulse called it ‘lancing a boil’.

    The UP is still restrictive in a number of ways that I think is problematic, but it is clearly a much improved step forward for allowing better, and fairer, urban form to develop.

    We now wait to see how it unfolds. Rather like addressing the structural problems in the transport sector this is a multi-year project.

  4. IMO we probably need 3-4x as much infill capacity as we expect population growth.

    Unlike greenfield expansion infill takes a very long time to max out.

    Japan actually has an interesting advantage here. They have a bias against second hand housing so there’s a very high rate of rebuilding, which means lots will be redeveloped to max capacity very quickly when needed to do so.

  5. Still much too restrictive, in random and unsystematic ways. There is no way we will come even close to the potential for commercial viable extension.

    If I have a backyard (hah), is it worth it to infill with a new house? There is risk, the profit is probably not all that taking into account the changed value of the current house and we left with a view somebody else’s kitchen. OK, Now there is potential to make more by building a 3 storey terrace but both need multiple properties, so actually I can’t; i need to find a developer, and get my neighbours to agree, 8-).

    I dont’ mean to criticise the UP (well maybe a little) but there is huge friction that means that it won’t do the job.

    1. “is it worth it to infill with a new house” -> no, because a backyard has a value far above the mere monetary gain you might receive. Gain the world, lose your soul and so on.

      1. That, and you will also end up with a really awkward arrangement. The houses will be sitting in weird positions on their lots. Most of the area between the houses will be used for parking cars, and you’ll lose a lot of that space with the driveway to the house in the back.

      2. surely not all backyards and infill houses are equally valuable? Surely the answer is “perhaps” rather than “yes” or “no”?

        It seems to me that you like to talk about “measuring outcomes”, but at the end of the day you have just as many subjective preferences as anyone. In which case the issue becomes not one of measuring outcomes, but working out whose preferences to respond to, and why.

  6. Peter you raise a good question -Is the Unitary Plan any good? The Unitary Plan was supposed to make things easier. Remember the photo of the pile of planning documents? What we have ended up with is a huge document that now includes all of the regional policies and rules that covers every aspect of consenting which we have to wade through. Sure under the old system there were a lot of documents but for most applications you only had to look in one and it was a hell of a lot easier to use. They also put forward the argument that rules needed to be consistent when the truth is they dont and because of all the precincts they are not.
    It seems to me we have done the wrong thing really well.

      1. What was wrong with one regional policy statement and a bunch of district plans that only had the stuff needed for each area? That was easier to use. They had that stupid diagram showing how complex consenting was. But you usually only needed one little part of that process. Now we still have the same complexity but you have to go through a bigger process and deal with more people. WTF was it all for?

        1. Isn’t it the case that as people familiarise themselves with the new rules, they’ll figure out which bits they can gloss over and which bits require more focus?

        2. Yes there is a learning curve. But my grumble is that it doesn’t provide a more efficient system than before. It is probably worse. Before there were multiple plans but you only had to open one of them and each was smaller and simpler to use. There were different rules in different places, which we still have, but now understanding that requires not only zones but dozens of precincts. Even for the Council this is going to be more work. As for everyday people, most of the old plans were quite accessible, the rules you needed were in one section of one smaller plan. Now good luck if you try without a planner. The justification was the difference in similar rules, but why is that a problem? Different cities have different rules to address different problems. Why shouldn’t areas of the city be different? (actually they will be due to the myriad of precincts and ‘additional density controls etc). But one of my biggest complaints is the language used in a lot of it. They used a team of so called experts to try and get a common style. Unfortunately they didn’t seem to know the difference between a policy and a rule, or a rule and an assessment criterion. at least we fixed that part in the transport mediation. As the Council’s own lawyer said ‘at least one chapter will be written properly’.

        3. If I were writing a planning rulebook from scratch it would probably be a lot simpler. But then again, I’m an economist, not a planner. And I’d probably miss a few things in the process.

          I think reducing the number of zones is a really useful initiative, as it does make it easier to simplify consenting and increase economies of scale in construction. (IE a design that’s allowed in Manukau will also be allowed in Waitakere.) But you’re right to say that’s counterbalanced by the proliferation of precincts and overlays. Net effect remains to be seen.

        4. That economy of scale was how they sold it. But because no two sites are the same you end up with different designs anyway if you are maxing out. If you are not then there are plenty of companies that offer a book of the same designs right across NZ. I suspect the real reason everything was put in one was tidiness. People don’t like differences. Back when we had boroughs like Devonport, Northcote or Mt Eden the District Schemes were skinny little folders. Your application only went to the staff who needed to see it. Now it is a factory approach where everything goes through each station.

        5. “you end up with different designs anyway if you are maxing out”

          That’s a good sign that the development controls are too restrictive. If everything’s being built out to the zoning envelope, possibly time to consider whether to expand it.

        6. If the rules don’t bite then there is no need for them. Presumably they are there to protect something. But the point is site shape, orientation and gradient usually has as much impact as the rules. It is seldom now that people do the cookie cutter stuff like the old villas. So it is hard to see how common zones right across the region will benefit. Maybe I am wrong in which case why stop with the city? Shouldn’t the government insist common zones nationally if there is some benefit I am missing?
          The main issue the PAUP had to address was the constraints out and up which could just as easily been done with an RPS and probably would have been an easier way rather than the half baked zoning arguments we all made in the absence of an RPS.

        7. At the point at which zoning rules become tightly binding, we have to ask: are the benefits they create worth the costs? This is seldom done. And I would observe that Ponsonby-style development was basically driven into extinction by overly restrictive district plan rules – minimum lot sizes, parking requirements, side and front setbacks, etc. Thankfully the Unitary Plan eases many of those restrictions.

          On the national zoning code question – that’s exactly what Japan does. They have pretty affordable housing, even in large, growing cities like Tokyo. Of course, their standard zoning approach is also a *lot* more liberal than ours.

          On the RPS concept, you’ve previously criticised the 1990s-era regional growth strategy, which was defined in the RPS but never put into practice in district plan rules, as a fine example of unintended consequences in planning. So I’m unclear why you would advocate it as a good solution now.

        8. The fact that they wrote a crap RPS doesn’t mean I think we shouldn’t have a good RPS. The RPS is the instrument to align the parts of the rules that need to be aligned. The problem was their goal was a shit one. To put a collar around Auckland in the hope that would result in intensification without any cost. It was never going to work and all it did was create the supply side of a housing crisis. The Unitary Plan has probably given us the RPS we needed all along. But at the same time it has given us a bunch of rules that were developed in a hell of a hurry and which may or may not be consistent with the objectives. The one thing that is clear is the rules are harder to identify and use.

        9. Would you have moved to a common set of standards over time as the plans were reviewed or left them with their own idiosyncrasies?

        10. I would have standardised the higher level bits which had to reflect the RPS anyway but left the minor rules to reflect what suited each area. Who is better off if the rules are the same on every site? Not every rule even makes sense everywhere. The owners and future residents are not better off. Only a few professionals who have less to learn gain anything. Unfortunately when you centralise this stuff the plans just get bigger and bigger.

  7. One concern I do have is that in areas that are allowing some infill but not higher buildings etc is that in the medium future we might want to have higher buildings in those areas… however because they have got fairly new lower density buildings on them it wouldn’t be economic to bowl them and replace them (ie the isthmus areas that haven’t had much of a density increase in the UP).

    1. I share this concern. It seems to me that in Europe most development proceeds from single storey dwellings (or less) immediately to 4-5 storey apartment buildings, because the former are cheap to knock down. If you get a lot of infill development, but constrain apartments, then you will create a higher barrier to ultimately increasing density any further.

      1. I can’t remember seeing a lot of single storey houses in any European city, or even in small towns. These cities for a large part developed before we had cars and other fast transport, so space was scarce back then. In cities around where I grew up the traditional way of building is terraced houses.

        Auckland on the other hand developed mainly around trams and cars, which made a large amount of land available.

        That difference is still apparent today. In Belgium a lot of new developments are still terraced houses, or semi-attached houses. Freestanding houses are also common but the scale is much smaller than their counterparts in Auckland. The houses usually are 2 or 3 storeys, have a much smaller footprint and generally not a lot of setback on the sides. So even a house on a 400m² lot would have a decent yard (in stark contrast to Auckland, where most lots of that size look absolutely cramped).

  8. New apartments marketed as ‘affordable’ can cost up to $15,000 per square metre. Is this in line with world standards?

      1. Let me guess, the question is: is the difference supposed to be that large? I always thought low-rise can be built for a similar price per m² as houses.

        And yeah, real estate agent language. “Affordable”. Apartments are usually an “investment opportunity”. Also a good one: SugarTree (on Union Street, CBD) being marketed as being “in Ponsonby”, which says a lot about the CBD, none of it good.

        1. Exactly, I’ve found this table from Australia that indicates that while construction costs rise mid rise construction costs are less than double the costs of a standalone property. I think $15,000 per square metre seems ridiculous. I know land costs are generally higher where these developments are located but with multiple apartments sharing the same footprint then this should be offset. Is there something I’m not getting or are we getting ripped off by new developers?

        2. No, your not being ripped off. It is harder to build an apartment than a house because of zoning rules. So the price increases because demand is so much higher than supply. Liberalising zoning would increase supply, reduce construction cost, and reduce land cost for apartments.

  9. The Plan is good, not great. The IHP did a good job in taking it from a totally inadequate plan based on faulty analysis and evidence to one that was good.Sadly, it’s all ten years too late. The horse has bolted, and the ‘relatively’ egalitarian Auckland of old where people of moderate means could buy property, has gone. Both local and central government have been totally asleep at the wheel for the past 15 years on supply AND demand side policy. There is a quite incredible dearth of understanding and lack of sophistication on housing policy and regulation , I really shake my head at times. Some of the garbage that comes out of the mouths of very senior professionals….
    And until something is done about the torrent of foreign investment into property in this country, then the supply side measures just won’t make much difference at all. Supply has no hope of keeping up with that torrent, as long as it continues. The govt’s foreign investment data is not reliable, intentionally or unintentionally.What a disgrace this country has become, where our citizens are treated with the lowest priority, far below the interests of foreign investors who are doing very well thank you very much.Sorry for the rant I feel strongly about this mess.

      1. exactly. But how much leverage will Phil have over what is essentially national policy? (ie. rules on foreign investment, immigration policy)
        I have visibility over an apartment project where more than 70% of the presales are to foreign investors.
        The whole thing is a disgusting sham.

    1. “And until something is done about the torrent of foreign investment into property in this country, then the supply side measures just won’t make much difference at all. Supply has no hope of keeping up with that torrent”

      In what way does foreign investment exacerbate the problem? Foreign investors rent out their properties and so increase supply to the rental market. Ceritus paribus, more foreign investment helps alleviate the housing crisis by encouraging the supply of housing (development).

      1. The problem with foreign money is that it is not grounded in the parameters of the local economy. Funds that help unlock project barriers are welcome, but offshore money is often investing on very different risk/return decisions to local workers. Hence we get a substantial discrepancy in prices and understandable cries of pain from the people that the housing is apparently meant to serve.

        Once capital gain is king the next logical step becomes leaving property empty, a phenomenon observed many times overseas in new investor-targeted schemes (typically apartments as they are easier to buy and delegate management for).

        An investing kiwi is likely to have a beachside Bach which they leave empty for a majority of the time; an investing offshore resident may think similarly of an Auckland house as their holiday home / passive investment.

        The same out-of-town disconnect in price and income occurs in both these cases, and quite possibly a similar disconnect between the type of property provided and the ‘local’ needs. But rather than a likely scenario of adding value to a low-demand economy (typical NZ small coastal locations with otherwise declining populations), the offshore mechanism in Auckland and other major centres exacerbates prices and possibly product mismatch in a place with a high level of true local demand.

        I don’t have a fundamental hang-up with offshore money (although I do regard local money as superior in terms of broader outcomes), as long as it is well regulated, monitored for risks around tax and money laundering, and channeled into housing in a way that aligns with local needs.

        Sadly, New Zealand currently does none of these, and we have a government that is deliberately sleeping at the wheel without the cruise control on, let alone the autonomous AI switched on….

        1. Great comment. Very good analogy, it’s the problem of exogenous money, just look at Queenstown, empty mansions everywhere, and waiters and chamber maids crowded 20 to a freezing bungalow…

          I also always think of Omaha when people go on about ‘ghost homes’; it must be a lonely evening padding those streets on census night, not a soul to be found, just hundreds and hundreds of well housed ghosts…

        2. Local money is advantageous in so many ways. I’m a huge fan of the UK’s Building Society model, which was one of the original enablers of 20thC housing development in that country (alongside public works). It many ways it was _the_ enabler of private housing development there.

          Many Building Societies have changed substantially now with very few operating on the old ‘mutual’ model, but in effect they provided a very closely tied local loop of savings and investment. Some were initiated by local Patrons provided pump-priming funds, which gave the platform for locals to be confident in saving with them.

          There used to be dozens of them, with a high degree of connection between needs (true demand) and supply, and a very high degree of financial robustness. It is no accident that the remaining Mutual Building Societies weathered the GFC extremely well (Nationwide for example), and that one of the old BS’s that converted to a “modern” bank (ie over-leveraged and commoditised) triggered the UK recession (Northern Rock).

          We still have the tools to rebuild this type of system. Credit Unions are one, and fortunately we still have some local (at a national level) saving + loan banks such as TSB who are clearly grounded in our local economy.

          The more we rely on offshore money the more we stretch the gap between our means and our expenditure. Offshore money, as currently intervening, is only selling us the lie that we can afford this property nonsense. It’s only a matter of time until it all falls over – again.

        3. If it was true foreign investment was leading to low occupancy rates then I would agree this could be an issue. However my understanding (based on the analysis presented on this blog) is that there is nothing unusual about occupancy rates for Auckland.

        4. The potential for investment homes being left empty wasn’t my main point – it’s just a side risk, and I agree that in AKL this appears currently not to be too much of an issue. Not surprising given the lack of local supply perhaps. However, I don’t think this factor needs to be manifest for my main argument (the way overseas money causes price disconnect, with lack of dependency on a locally-grounded level of cashflow) is in any way dependent on this…

  10. Maybe if foreign investment is limited to new builds as per Australia. But foreign buying of existing properties does not increase supply at all!
    If you don’t believe foreign investment is driving the market into frenzy, look at the early effectiveness of the new policies in Vancouver, which are having a real impact
    It’s simple maths and supply and demand – large numbers of foreign investors, small market (NZ/Auckland) with limited construction capacity = recipe for rapid price escalation.

    1. It shouldnt matter whether they buy new or existing stock, it is the aggregate demand that will elicit a supply response. I am sure foreign investment does push up prices, however I have no idea how significant it is. High house prices are not a housing problem in and of themselves. They are only a problem in and of themselves for would be house buyers. So the issue you are getting at is that of investors outbidding FHBs. Should this issue be policy relevant? I am not convinced it should be as investors provide housing for the rental market, typically a poorer cohort than FHBs. So to tip the balance in favour of FHBs is to tip the balance against renters – a regressive policy.

      1. It doesn’t really matter in the big picture of prices whether it is a purchase to rent out or for owner occupier purposes (although one clearly incurs greater costs to the end consumer; why else is buying preferred so strongly?); what matters is whether the price to the consumer is in touch with local incomes.

        “High” prices means neither buyers can’t purchase homes and renters can’t rent at reasonable cost levels; something else in their personal finances has to give. People voluntarily choose to make many sacrifices, but we should recognise that we have gone over a critical social threshold when we see the number of people who are at the extreme end of making choices or out of choices altogether.

        For me, kids growing up in cars due to lack of homes is not OK in 21stC New Zealand, and I think history will judge this government very harshly for their irresponsible management of housing finance, whether offshore influx, local lending practices, or failure to address taxation inequities.

        1. I don’t doubt the housing crisis is real, but it is a problem of supply not foreign investment. People are living in cars because there are not enough houses, not because foreign investors own some.

          I think history will judge the late 20th C planning profession very harshly.

        2. Matthew W – I used to be like you, I thought the issue was much more about supply than demand, although I always maintained that some form of demand side action was needed. I’ve seen / learnt things in the last 6 months that have fundamentally changed my view. I now think my former view is naive . Supply is still critical, but a torrent of foreign money, not always obvious, is pushing the whole market up and up. If it isn’t,why are the new initiatives in Vancouver having such an effect (with a similar foreign investment profile)? And don’t quote me the stats on foreign investment – they are flawed.I know a very clever man, an economist, who is a libertarian, and has long maintained a view that it is ‘all about supply’. He has recently changed that view to seeing that foreign investment is critical, and we need to regulate it. This is a guy who fundamentally believes in the free flow of capital around the world. But even he can see that NZ is getting screwed by this ‘free for all’ for foreign investors. Kiwis simply can’t compete with the scale and wealth of that investment base. At the very least, taxing this investment would return this country and its citizens a revenue ‘dividend’. Sue Simons, a very prominent Auckland lawyer, also addressed this issue at Property Council breakfast in Auckland a couple of days ago. She is hardly a left wing interventionist…

        3. Another flaw with the supply side obsession is that in the NZ context it ignores that a city like Auckland:
          has a relatively small population and construction sector / capability. And beyond Auckland, we are a very small country with limited sector resource. This is totally different to a much bigger country like the USA, or even Australia.
          The supply side obsession assumes that if we free up all regulation, the city and its construction sector will be able to suddenly, miraculously, respond to all this demand, both local and foreign.
          Yes, the sector can grow in time, there is no doubt about that. But there are limits to its capacity growth.
          The pure math is against a supply side approach being sufficient.

          Again, I’m not arguing against planning reform. That is critical. But, it is ‘necessary but insufficient’.
          Assuming Auckland continues to be popular for migrants and investors, we’ll never be able to address the housing issue properly without addressing the demand side.

        4. Planners do indeed deserve some pretty harsh judgment…but nowhere near as much as the Pollies I’m afraid. The planners and councillors have at least faced up to the issue with this final revision to the unitary plan, even if they still have a lot to learn about effective vision building, communication, engagement and productive rule crafting.

          On the other hand, there still plenty of opportunity for politicians to take instantly effective action but after years of planner-bashing they continue in wilfully choosing not to take the hard decisions themselves. Pretty two-faced, but as The Spinoff pointed out this week that pretty much sums up Nick Smith’s position right now.

    2. Matt while there is some advantages of limiting foreign buyers to new builds, (the main one being increased supply) the demand side of the property market has nothing to do with who owns the properties it is all about who/how many people want to live in them.

  11. Don’t think it matters in long run because they Productivity Commission report looks like the Govt will gear up to replace RMA

  12. The political process included the IHP and given the time constraint on the council it was more reasonable and practical to pass on the feasibility study to the IHP who had far more time to just review the UP

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