Welcome back to Sunday reading.

Here are a bunch of housing stories starting with one from the Yale professor Robert W Shiller on the supply constraints responsible for the housing crisis in the States. Robert Shiller, “Why Do Cities Become Unaffordable?“, Project Syndicate.

In many cases, the answer appears to be related to barriers to housing construction. Using satellite data for major US cities, the economist Albert Saiz of MIT confirmed that tighter physical constraints – such as surrounding bodies of water or land gradients that make properties unsuitable for extensive building – tend to correlate with higher home prices.

But the barriers may also be political. A huge dose of moderate-income housing construction would have a major impact on affordability. But the existing owners of high-priced homes have little incentive to support such construction, which would diminish the value of their own investment. Indeed, their resistance may be as intractable as a lake’s edge. As a result, municipal governments may be unwilling to grant permits to expand supply.

Insufficient options for construction can be the driving force behind a rising price-to-income ratio, with home prices increasing over the long term even if the city has acquired no new industry, cachet, or talent. Once the city has run out of available building sites, its continued growth must be accommodated by the departure of lower-income people.

Closer to home we have a recent study that finds that land use restrictions may make up a whopping 56% of the cost of housing. David Hargreaves, “A Government-commissioned report has found that land use regulations add about 56% to the cost of houses in Auckland; ‘prices far outweigh costs in most major NZ cities“, Interest.co.nz.

A Government-commissioned report has found that a staggering 56% of the cost of Auckland houses may be due to land use regulations. The report, which looked at housing in seven major cities in the country, says that land use regulation is hampering the flexibility of housing supply.

“Relative to a world with no land use regulation, regulation could be responsible for 15% to 56% of the cost of an average dwelling across a range of New Zealand cities,” the report says.

“In Auckland, land use regulation could be responsible for 56%, or $530,000 of the cost of an average home.”

Here is a smart opinion piece from Los Angeles comparing the use of development fees which penalise developers and slow building to taxing land value which broadly distributes the cost of housing.  Michael Manville, Paavo Monkkonen, Michael Lens, “A better way to solve the housing crisis — tax land, not development“, Los Angeles Times

Perhaps most important, land taxes put the responsibility for solving our housing crisis where it belongs — on every property owner in the city. Linkage fees place that responsibility on developers alone. The logic of linkage fees suggests that building housing makes housing unaffordable, that developers alone benefit from high housing prices, and that developers should pay to make things right. Because most of us aren’t developers, this message is morally comforting and politically convenient.

But it is also wrong. Housing becomes less affordable when we don’t build it, not when we do. Most important, it is not developers who benefit from our housing crisis but everyone who owns property. Yes, some deep-pocketed developers have profited handsomely in our overheated market. But so have landlords, who with limited competition have charged ever-higher rents. So have homeowners, whose property values have ballooned. And unlike developers, landlords and homeowners have prospered without increasing our housing supply. Many, in fact, have fought to stop new housing from being built.

Housing scarcity delivers unearned wealth to people who own housing, and it imposes unwarranted burdens on people who don’t. To solve our housing crisis fairly and effectively, we should tax that wealth and use it to ease those burdens. It’s easy to wish that someone would help our disadvantaged fellow citizens. It’s harder to acknowledge our own role in their distress — to admit that our capital gains are their housing crisis. But that is the situation: Linkage fees feed the false belief that some of us in some neighborhoods can keep blocking development and growing our nest eggs, while the city helps the poor by taxing someone else to build affordable housing somewhere else.

Here is a great video on the insidious practice of requiring parking with development. Auckland is thankfully reforming parking requirements which is compared here to “blood letting” by Donald Shoup.

There has been a lot of discussion about how driverless cars will transform city streets since people will be able to walk across any street without the fear of traffic. It’s useful to recall how the use of city streets was systematically transformed to favour traffic by the auto industry. While we may not have “jaywalking” in New Zealand, our road rules, street designs, and customs remain a shameful reminder of what remains king of the street.

Sir George Grey Special Collections, Auckland Libraries, 580-11054

Separating people on bikes from fast moving traffic is the foundation of cycleway design in countries with high levels of cycling such as the Netherlands. In countries with under developed cycling facilities, there has been a gap in research and understanding about the safety record of separated/protected facilities. As cities begin to build out high quality cycle networks, not surprisingly, cycling become safer and more attractive. “Study: The Quality of Bike Infrastructure Matters“, via Planetizen.

That’s all for this week. Please add other links in the comments below.

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  1. Interesting reflections as always. The unitary plan is huge own goal. It should have zone the entire isthmus as thab and perhaps everything within 100 m of a station as city center. Instead we have a sad plan that would only deliver if everyone incrementally builds to the theoretical allowance … over 40 years. Up zoning isn’t a requirement but possibility…

  2. Thank you for a friendly Sunday morning read. Usually I don’t watch the embedded videos (a) because it distracts the others in our room (b) preferring to absorb and skip information at my own pace. But the video about parking was an exception and I’ll add my recommendation to Kent Lundberg’s. It left me thinking of Albany.

    It was Albany that first interested me in city design / town planning. Clearly Albany is dreadful and almost certainly it was designed; probably by highly paid trained town planners. I’m sure the sweeping curves of the roads must have looked impressive when mock-ups were shown to the council for their approval.

    One minor correction the author thinks we “may not have “jaywalking” in New Zealand”. Checking the definition is “cross or walk in the street or road unlawfully or without regard for approaching traffic” I realise I do it frequently – we all need to break a law occasionally for the good of our soul and this one doesn’t harm others (or at least no driver has had a heart attack so far). Of course never with total disregard of vehicles and of course never within sight of children who may copy and never in Highbury with its many convenient zebra crossings. However in Albany unless you drive from shop to shop you have to walk and they have controlled crossings deliberately designed to be as far away from the roundabouts as possible or in other words hundreds of metres away from where you actually want to go. Then while you stand waiting for your green light you get wet and cold and smothered in car exhaust fumes. So I jaywalk. If I do get noticed by a policeman I know they will be in a police car and therefore can’t chase me down until they can find somewhere to park.

    1. Bob, at least NZ won’t throw us in jail for daring to walk where cars rule in town.
      Albany was designed in the 90’s for big box retail – and then before the boxes were built, it was re-purposed to become a town centre, with apartments now being built, civic space and street-facing activity.
      Even so, Westfield with car-park blight holds the central spot.
      City planners and transport engineers have been trying to find the way out of this mess for decades, and some developments (not Westfield) have reduced parking provision to the lowest that can be permitted under plans, predicting occupancy across day and hour to minimise wastage for retail, office and hospitality where possible. But, until proper town centre activity can dominate, with support of frequent PT services, employee parking (plus park and ride) overwhelms the use of land available.
      The intrepid rambler can explore the Albany challenge – find the walking route from the busway station to Massey Uni!

      1. There is a regular bus from the busway station to Massey Uni – at least half the times I jump on the Birkenhead bus in Albany it takes me to the busway station when I am really trying to get to Highbury. But if you do walk I recommend going through the Warehouse underground car park – it is dry, fairly empty and a good short cut.

        Albany is car park heaven. The giant overflowing Busway car park, the Massey Uni car park (I once got totally drenched walking from the nearest empty space to a lecture – at least Heidi would approve of the long walk), Westfield’s two car parks, Pak’n’Save, Mitre10 and the Warehouse have their underground car parks and the stadium has a gigantic car park that is empty 99% of the time and then there are the car parks to the north of Oteha Valley rd. While looking to park you can read the signs: ‘only students can use this car park’, ‘only shoppers can use this car park’, ‘only spectators can use this car park’ and ‘spectators can’t use this car park’.
        The obvious design would have been a single giant carpark and a few free buses to move the public from stadium to uni, to busway, to shops, to law court, etc. There has to be something badly wrong when there are so many car parks that are either empty or over-flowing at the same time.

    2. The difference is that here in NZ we don’t have a general rule requiring pedestrians to only cross at crosswalks (as is common in the US). This leads to the absurd situation where people have been prosecuted for not walking a half-mile to the nearest formal crossing point (if there are no mid-block crossing facilities between distant intersections), e.g. http://www.huffingtonpost.com/radley-balko/raquel-nelson-jail-for-jaywalking_b_905925.html

      Here in NZ, there is only a minor requirement not to cross within 20m of a pedestrian crossing or underpass/footbridge, but that still leaves plenty of places where you can cross mid-block. There is also a requirement for pedestrians to remain on a footpath where practicable and to cross roadways at right angles, so I guess the overall gist of this is “as a pedestrian, don’t loiter needlessly on the roadway.”

      1. Is that story true? What sentence did she get? What an absolutely horrible thing to do to someone that has just lost a child.

    3. “cross or walk in the street or road unlawfully etc” – are these words from an NZ act or regulation? If so, what is the act/regulation and action number please?

  3. Interesting head picture with good figures comparing deaths from terrorist attacks, armed conflict and car accidents. The car is a number one killer.

    Another comparison I’d like to see is injury to cyclists from physical attack in public spaces vs injury to cyclists from car accidents in on–street cycleways. This comparison is important in our design of cycleways, where the risk of attack on a less publicly-visible fully-separated cycleway needs to be compared with the risk of injury from a car on an on-street cycleway.

    1. How can you even measure ‘physical attack on cyclists’, isnt that under the general heading of road rage. I think attacks by dogs would be a far greater problem, there wouldnt be many pedestrians who havent at least been ‘menaced by a dog’

      1. I wasn’t even thinking of road rage. I was meaning any sort of attack that you could be fearful of, given that the off-road cyclepaths are less under the public eye. Assault, rape, dog attack… The statistics are clear that off-road cyclepaths are safer, accident-wise: In Helsinki, where the off-road and on-road networks are both well established, accident rates on the on-road network are 4 times higher than on the on-road network. There is a push here for on-road rather than off-road paths to keep the cyclists in the public eye, and therefore safer. The off-road cycle paths would have to have a lot of “stranger danger” to make up for the lower accident rate. Perception is actually important, because if on-road feels safer, that’s a factor too, but I think the right starting point is the statistics.

    2. Heidi: there are occasions I suspect you are at least mildly anti-car. FYI many years ago I heard an academic had compared the incidence of death and injury in cars in a western country with a remarkably similar statistic for death and injury in PNG related to coconut trees (falling when climbing or nuts falling on the head). Getting rid of coconuts in Papua will be as difficult as removing cars from New Zealand.

      Cycleways can run through ‘less publicly-visible’ areas if they are flat – reasonably fast bikes are unlikely to be attacked. Of course CCTV is a deterrent too. The footpath on my road (Eskdale rd Birkdale) is only moderately lit and virtually deserted most of the time – it would be very easy to attack a solitary pedestrian but we feel safe. The Blessie Gotingco murder took place not far away but it was very shocking because it was so unusual – note she was using public transport and then walking home from her bus-stop. Maybe some very nervous neighbours have abandoned use of public transport but I doubt it; note parking in the CBD is frequently in less publicly-visible car parks whereas Bus-stops in the city are public places.

        1. Drinking the coke more dangerous than the machine? Seriously when on your next holiday in the tropics take care when walking through copra plantations – ask the locals.

        2. Bob: there are occasions I suspect you are at least mildly anti-sugar. 🙂 High price associated with coconut palms in Cairns, where they have to denut the palms to reduce the risk. Mildly insane, there, where the palms are not native.

        3. Heidi, you are a worry – how do you know more about everything than I do? And I’ve had holidays in Cairns and never knew about palms being denutted. A good fact to know – just need the right opportunity to spring it into the conversation. And ‘denut’ is a lovely new word.

          With a Papuan wife I have no choice but to be overweight and consume coconut milk with every second meal she cooks. I do hope you are designing your cycleways for plump cyclists.
          Sugar is not healthy (note the Brits being at their healthiest when they had rationing) I like sugar but try to avoid adding the processed form to food or drinks.

        4. You should hear my mother (who lives in Cairns, hence my denut knowledge) going on about how when she was working in the Cook Islands (counting shellfish, if I recall) the local nurse was telling the locals to cut down on coconut milk. It infuriated my mother, who knew that coconut milk is indeed part of a healthy diet, whereas the coke and the cans of corned beef, and the sheer volume of food… 🙂

          But shame on us, Bob, we are waaay off topic. Go watch the last video and report back.

        5. Way off topic, but amusing. I had a mental image of Bob before, and I shall have to change that now. Heidi, I’m afraid that from your name, you’ll always appear as a young swiss with blonde pigtails, in my mind at least. And now you’re both covered in coconuts. Worrying indeed.

        6. Family is out so I watched the last video. Applying to Auckland. A need to reduce the traffic by a fairly small amount which will dramatically remove congestion (this also matches personal perception that over the last decade there has been a small increase in population and a dramatic increase in jams). To do so (a) provide alternatives (b) congestion charges to persuade use of the alternatives.
          If the emphasis was (b) then the rich will drive and the poor will have a choice of being poorer or walking in the cold and wet to wait for a bus/train/ferry and of course the poor will still have a need for a car sometimes working at multiple sites and sometimes because they are carrying heavy items.
          So solution is a modest congestion charge but applied quite widely (CBD, Bridge, Greenhithe Bridge, Waterview, Puhoi tunnel) – it can be done intelligently [varied with time of day, only one charge per day, etc] and automatically and charged to each vehicle when paying for the Registration (NB current system for tunnel near Puhoi is too expensive and administratively messy). But this has to be combined with (a) subsidised PT; free for buses the CBD and cheap and easy for tourists.- the faster passengers can get on and off the better.
          Say 50% of PT paid for by congestion charges??

        7. Fair enough observations. I don’t care too much about the details of congestion charging as long as equitable solutions are sought. I thought the mention of increased danger to pedestrians was pretty flippant in the video. In fact, roundabouts are very dangerous for cyclists. But that second part of the video seemed almost trivial compared to the first part. What a shocker of a road: 28 lanes. I’ve heard similar things about Atlanta and some other US cities. Induced traffic is real, it is substantial, and NZTA needs to start including it in their modelling before they damage our city more.

      1. I’d be interested to see what the difference is safety wise between walking between 2 points vs driving, risk of being attacked vs involved in a motor accident (or carjacked). Given most people insure their cars there is obviously some acceptable perceived degree of risk involved with motoring.

        1. Most people believe they are in control of their car and are safe inside with the doors locked but they feel frightened when as pedestrians they pass a couple of kids wearing hoodies. It is Perception -v- Reality.
          Ref 9/11 with increased road accidents killing more than the terrorists.

      2. “Heidi: there are occasions I suspect you are at least mildly anti-car. ”

        Anyone who is paying sufficient attention to cars must surely become anti-car.

        1. Yes, there are plenty of places and times when I am “anti-car” (i.e. it’s a dumb choice for the situation). Doesn’t stop me from owning two cars though (and two bikes, three bus cards, countless shoes…)

  4. i think you’ll find the report said regulation could account for betwee 15 to 56 per cent of costs. it’s incorrectly reported as does contribute 56 per cent.

    1. Yes, the figure is 56% for Auckland. That is a significant number. I hope someone who works in the area can critique the report. Certainly we need to be able to discuss which regulations will drive the city’s housing development in the direction we want, and which are just an impediment to development. Is the report robust or ideologically driven? The report doesn’t include the word “credit”, and “finance” barely comes into it. Comments, anyone?

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