The other week, BNZ economist Tony Alexander made an interesting point about Auckland’s current urban growth (via Interest.co.nz):
The plan set out in Auckland’s proposed Unitary Plan to build 422,000 houses will require a rate of building over 25 years that it previously took 161 years to achieve in the City of Sails, BNZ chief economist Tony Alexander says.
In his Weekly Overview report Alexander notes the Unitary Plan’s aim for 422,000 extra houses to be built over the next 25 years requires an annual construction rate 2.5 times higher than the average achieved over the past 25 years. Canterbury achieved 1.5 times post-earthquake.
“Look at this another way. As at the 2013 census there were 509,000 dwellings in Auckland. In 2001 there were about 420,000. The plan is another 422,000 in the next 25 years, in other words doing in 25 years what it took 161 years to do following the designation of Auckland as the country’s capital by the first Governor William Hobson in 1840,” Alexander says.
Now, it’s worth putting some caveats on this. The Unitary Plan allows around 422,000 new ‘commercially feasible’ homes to be built in Auckland – but it doesn’t guarantee that they will be built. Other factors, such as the availability of construction labour or funding for infrastructure, could still pose road-blocks. On the other hand, Auckland’s population might not grow fast enough to need another 422,000 homes, eg if the New Zealand economy declines for a prolonged period.
But Alexander’s comments nonetheless put matters in perspective. Auckland is currently experiencing historic levels of population growth. The city has never been faced with the task of accommodating as many people, in as short a time-frame, as it must at the moment.
[As an aside, I’ve covered the reasons why this is happening in a previous post.To summarise:
- The majority of recent and future population growth – about 60-65% – is from natural increase, i.e. people being born in Auckland
- Net migration, principally from overseas, accounts for the rest. Net migration is very volatile – high inflows in one year can be balanced out by outflows in the next.
For the record, commenters complaining about population growth or the origin of migrants without engaging with these facts or providing references for their own views will be deleted.]
How unprecedented is Auckland’s current and projected population growth, anyway?
Historical data on urban populations provides a window into this question. Here’s one of the key graphs from a 2013 paper by Arthur Grimes and Nicholas Tarrant, showing the growth of New Zealand’s largest five cities in 1926.
At the start of the 20th century, Auckland wasn’t that dissimilar to Christchurch, Wellington, and Dunedin – a bit bigger, but not by much. But over the course of the century, it diverged, and, what’s more, the rate of divergence seems to have increased. In 1926, Auckland was only 60% larger than Wellington, the second-largest urban area. In 2006, it was 235% larger:
It’s common to measure urban population growth in percentage terms. That’s not a bad measure, in a lot of ways, as it captures the degree to which cities of different sizes are experiencing relative changes. Adding 500 people to a town of 10,000 may feel as transformative as adding 50,000 to a city of one million.
But when you’ve actually got to build stuff to meet demand – homes, roads, pipes, busways, etc – the raw numbers matter a lot. When Auckland grows by 1%, it has a much greater impact on the national construction task than 1% growth in Timaru.
So with that in mind, here’s a graph showing the last 115 years of urban population growth in Auckland, plus the projections for the next 30 years or so. I’ve pieced it together from a couple of sources – Grimes and Tarrant’s numbers, including their unreported population figures for 1901, Stats NZ’s population estimates for 2006-2015, and Stats NZ’s population projections for 2013-2043. (These figures don’t line up perfectly, but they’re still broadly comparable.)
Here’s what we’re looking at. Between 1996 and 2015, Auckland added over 20,000 new residents a year – the fastest-ever increase. The only period that comes close is the late 1960s/early 1970s, and that turned around pretty quickly.
The range on future population projections is wide. At the low end, Auckland would “only” add around half a million people over the next three decades. At the high end, it would add another million people. However, the mid-point of the range, which is reasonably reliable over multi-decade periods, would see the growth trends of the last 20 years continue.
Now, this could potentially be a very good thing. The last 20 years of urban development has been, on the whole, positive for the city. It’s injected new life back into the city centre, created demand for a wider range of housing and transport choices, and given Auckland – for possibly the first time ever – great dining options. None of that would have been possible in the absence of population growth.
But growth also creates challenges. The city’s post-war growth model – low-density zoning and car-centric development on the fringe – no longer works. While there are still greenfield sites that can be subdivided, they’re located in less desirable places – Dairy Flat and Drury aren’t comparable to Browns Bay or St Heliers. And fringe locations built around the car are becoming increasingly expensive to connect in to the rest of the city, due to the need to expand road capacity across pinch-points. All the cheap motorways have already been built:
In other words, the city will have to change to accommodate growth. That means changing the way we regulate and build the housing market – the Unitary Plan has made a useful contribution. It also means rethinking the way that we invest in and manage our transport system. If the cost to develop transport corridors is going up, then we need to make sure that we get the best use out of them.
This means looking more closely at how congestion pricing can balance demands between time periods. It means choosing to dedicate more corridor space to high-capacity modes like rapid transit, and, in reasonably dense areas, cycling.
In addition to better enabling Auckland’s future urban development, there are a range of other benefits to this approach. People who have better options to get out of the car tend to be more physically active and healthy. Town centres where more people walk, ride, or bus up are often more vibrant and economically successful than those where people must navigate a maze of carparks. And, in generally, more connected places with better street life tend to be more enjoyable for everyone.
Here’s hoping the next phase of Auckland’s growth takes us in that direction.