Part one of a two-part post. Part two coming soon!
The Auckland Housing Accord was signed between the Auckland Council and government in October 2013, and ran for three years to the end of September 2016. It allowed for “Special Housing Areas” (SHAs) to be created, with new rules from the notified Unitary Plan, and streamlined consenting processes.
The aim of the Accord was laid out clearly in the opening lines:
“The Auckland Housing Accord between the Council and the Government is intended to result in increased housing supply and improved housing affordability in Auckland in the interim period until the Auckland Unitary Plan becomes operative”.
There were two clear goals here: increased housing supply and improved housing affordability. Goals worth having. But was the Accord a success (SHAccess?) in practise? It’s not a simple yes/ no question. We need to ask how much the Accord could realistically expect to achieve on its own, and whether the council and government also did everything they could to help in other ways.*
To determine if a policy is successful or not, you need to look at what its aims are, and how success is measured. Ideally, policies spell out their aims and give targets that can be measured. The Housing Accord was quite clear on both its aims and its targets. The targets were to achieve 9,000 consents in Year 1, 13,000 consents in Year 2 and 17,000 consents in Year 3, for a total of 39,000 over three years. “Consents” included “new building and subdivision consents in greenfield and brownfield areas”.
Essentially, whenever a piece of greenfield (undeveloped) land received consent to be carved up into sections, the number of sections would be counted. Whenever a building consent was approved, the number of new dwellings would also be counted, unless they were already counted under the subdivision criteria. As such, apartments and terraces were picked up under the building consent criteria, whereas freestanding houses were usually picked up earlier, under the subdivision criteria.
The targets above were the only ones set for the Housing Accord. Getting 39,000 homes or sections approved relates to the first goal of “increased housing supply” but doesn’t (directly) relate to the other goal of “improved housing affordability”. Arguably, this gave the parties an easier ride. Once the Housing Accord was signed, the government didn’t have to do much else, and the council just needed to make sure it processed plenty of consents.
Meeting the targets
The MBIE and council produced 12 “monitoring reports” over the Accord period, one every three months. Report #12 summarises some of the outcomes. Long story short, the Year 1 and Year 2 consent targets were both met, with room to spare. However, consents fell well short of 17,000 in Year 3.
Overall, 37,538 consents were granted over the three years, pretty close to the target of 39,000 (“96% achieved”). The parties congratulated themselves on a job well done. They hadn’t quite met the target, but they’d come very close. With no other targets defined, there was nothing for anyone to get upset about, right?
Two points before I move on. Firstly, there were actually 9,975 subdivision and building consents issued in the year before the Accord began. The Year 1 target was even softer than this, so it’s no wonder it was easily met.
Secondly, the Accord was announced in May 2013, but not put into effect until October 2013. The delay was necessary because they had to wait for the Unitary Plan to be notified, but it meant an easier ride to meet the targets – since consents were already on the way up.
A closer look at the consent numbers
The graph below shows building consent (dwelling) numbers all the way back to 1991, but section numbers are only available for the three-year Accord period. So focus on the blue bars!
The graph clearly shows the high consenting levels in the mid-2000s (boosted by CBD apartments), with consents falling sharply into the GFC period. This really hurt the construction sector, and was also the start of the current housing shortage. Consents have been climbing again since 2012.
As for the sections, note these are only the ‘additional’ ones which haven’t been given building consent yet. Otherwise we’d be double counting. In theory, these ‘additional’ sections mean there are now 11,500 more ready-to-build sections than there were at the start of the Accord.
Could building consents have climbed any faster than they did? Probably not. It costs money to get those consents, and developers won’t get them unless they expect to go ahead with the project. We’ve got a shortage of builders as it is, so the consents (and rate of building) probably couldn’t have gone any faster.
A better question is: how much slower would things have been without the Accord? More on that in part 2!
How many homes were actually built?
The information on how many consents got turned into homes is very sketchy. New Zealand doesn’t really have a consistent way of measuring home completions. The council did start to collect this information during the Accord process, and estimated that 7,920 homes were completed in year 3 of the Accord. This compares to 9,960 building consents for the year, and 13,760 consents total.
The council didn’t estimate completions in the first two years of the Accord, but I’d guess 12,000 homes. All in all, that means roughly 20,000 homes were completed during the Accord period. About half of the much more publicised figure of “39,000 homes” which were actually just consents.
Auckland’s population grew by 120,000 over the three years, so if we’d actually had 39,000 homes completed and ready to move in, then we would have been keeping pace. Instead, we had half that number.
But I’m being a bit harsh on the Accord here. The consented-but-not-completed homes are important too. Plus, there were other things the Accord did to help with the housing crisis. I’ll explore these in part 2.
* For what it’s worth, I think “did the council and government do everything they could?” is a simple question, and my opinion is that the council did pretty much all it could, and the government did bugger all (and took the opportunity to blame the council for everything that went wrong).