In mid-2009, in the wake of the global financial crisis, the number of new building consents issued over a 12-month period plunged to the lowest point since the regional level data began in 1990 (prior to that it is only at a national level). At that time, just over 3,100 consents were issued. Now a decade later and nearly three years after the Unitary Plan was adopted, the opposite is true with May setting a new record of just under 13,900 consents.

Mayor Phil Goff says another record month for dwellings consented in Auckland is more evidence that real progress is being made for housing in the region.

“A total of 1657 new dwellings were consented in May,” says Mayor Goff.

“That’s not only an all-time record for the month of May, it’s also the most dwellings consented in Auckland in any month in 16 years, and the second-highest number of dwellings consented in Auckland in any month ever.

“It takes annual dwellings consented to a new annual record of 13,881.

It’s worth noting from the comment above about May being the second highest is that the highest month ever was October 2002 where 1,945 consents were issued. However, that month is also an anomaly compared to the years before and after it and was created by a few really large apartment buildings, totalling 1,206 apartments, being consented.

What’s also notable is that much of the increase has come about since the Unitary Plan was passed in August 2016 and that more than half of all new consents are for denser housing typologies such as townhouses and apartments. The townhouse category is seeing perhaps the most significant difference compared to what we’ve seen before with nearly 3,600 consents issued over the 12-months period which is more than 50% higher than any time prior to the Unitary Plan being adopted.

The Stats NZ data also includes another interesting bit of information, dwelling sizes. It shows that not only are we seeing more smaller dwelling typologies but also that single house sizes are coming down too. For example, in mid-2014, the average standalone house being built was 238m² however as of this latest data, that has fallen to 211m². That’s about an 11% decrease and the last time it was this low was almost exactly 15 years ago. The increased mix of denser typologies has seen the overall average dwelling size drop to about 161m² from almost 221m². This is shown below although I’ve removed retirement villages as I’m sceptical about it and some of the apartment data.

In addition to the numbers above from Stats NZ, the council’s Research and Evaluation Unit (RIMU) are now breaking down the numbers to an even more detailed level and they show how much change is occurring. Some of the more interesting insights from this include.

Over the past year, 3,700, or 27% of those consents are within a 1,500m walk of a train or busway station. This figure only includes existing stations along with the Aotea and Karangahape Rd CRL stations. This means it doesn’t include any future stations added as part of the Eastern Busway, light rail, Airport to Botany or even Rosedale and any new stations between Papakura and Pukekohe. This is a good indication of the value developers are putting on having good public transport. I wonder the rest of the rapid transit lines that were agreed in ATAP were included how much higher that number would go.

Asked as to why 1,500m was chosen as the measure, they say

RIMU has done some research on PT preference and one of the findings suggests that people are willing to walk as far as 2000m to catch rapid transport. Here’s the link to the technical report. http://www.knowledgeauckland.org.nz/publication/?mid=1672&DocumentType=1&

The preferable walking distance is 1200m, but anecdotally the catchment distance has evolved to 1500m.

You can see the geographical area this covers on the map below however the consents shown are only for the month of April.

The other thing you can see on the map above are the boundaries for the old Metropolitan Urban Limit (MUL) and the more flexible Rural Urban Boundary (RUB) that was introduced as part of the Unitary Plan. This is important as the original Auckland Plan called for up to 70% of new homes to be within the existing urban area but allowed for up to 40% to be outside of that. Some of you may recall that at the time there were a number of public commentators suggesting that anywhere near even 60% of housing growth being within the existing urban area was considered unrealistic, despite it being the norm for a long time, and that as such we should allow a lot more sprawl to occur so that everyone could live in big houses on the urban fringes.

As part of their analysis, RIMU also break down the numbers by these boundaries. They find that over the last 12-months, 81% of all consents were within the old MUL while another 13% are within the RUB with the last 6% outside of it.

These graphs do show some good trends but we’ll need to maintain them for some time to make a real dent in our housing crisis.

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26 comments

  1. That there are more dwelling building and consents is an excellent situation.

    What is not good and what appears not to have been overcome especially in apartment building is…

    Developer A gets Architect B to design and elaborate vis a vis sellable building but on occsaion a not so elaborate building.

    The building of it is then subcontracted out to Contractor C who subcontracts out work to subcontractors D, E, F and G. Contractor C finds, as the project goes on, that things get a little too close to the loss margins (Fletchers and so many others). Meanwhile, there is next to no thorough oversight of the quality of work and worse still the complexity of the design causes more issues. And as appears not uncommon somewhere in the chain someone does something less than ideally, probably to offset the losses. The council, who some want less “red tape” involvement, are expected to see through the fog that is this project and sign it off. Enter high risk for Mr and Mrs Ratepayer.

    Next minute a multi-kilo panel falls off the building, crashing down on the street below, closing Victoria and Nelson St’s from a building that is already suffering water tightness issues. But the developer and anyone else whose fingerprints are on the project have quietly liquidated the company and maybe as happened in Parnell Terraces is reborn as a company with exactly the same name but with the year 2015, for example, after it, absolving them of responsibility.

    The mess that is the construction industry in this country is breathtaking. You would have to have balls of steel to buy an apartment in NZ because for every leaking building that makes it in the news there are many many more that never do. And ordinary law-abiding people lose everything.

    My question is this. The government have acknowledged that the building industry is a cowboy outfit. But what is being done here and now to give me the confidence to buy one of these? I conclude have more chance of success with a lottery!

    1. The problem can’t be avoided by buying a new house as you face all the same issues. But at least you can avoid the body corporate hell or even worse an apartment in a building that doesn’t even have a body corporate like the apartment that sold for $20k last week. I heard they were even open to negative bids to get the auction going.

    2. In oversea, there are some reputable premium branded large apartment developers.

      Instead of subcontract everything out, the developer build it themselves and has their own architect team. They also has their own body-corp company to make sure the property are well maintained.

      Once they finished one project, they move on to the next. So their own building team will always have work to do. They body-corp company also earns money.

      Since they build it themselves, the quality control are generally very good and the delivery are reliable. The body corp are well run and the building are well maintained. The units tend to hold their value well.

      Because of the reputable quality, they have very strong brand and they tend to charge premium and buyers are happy to pay for extra for trouble-free high quality and capital growth.

      In NZ, we got many inexperienced developers who only build one project cheaply using cowboy builders and liquidate afterward. The body corp is rip off and poorly managed. The units eventually become slum and buyers lose money in long term.

      We need some large players who want to build a strong brand in NZ

  2. I’d like to say that Hobsonville Pt has some decidedly affordable 2.5 and 3 bed apartments at sane prices coming online. I would be tempted but the floor size is just a mite too small for this stage in life. It’s good to see this opening up though as previously there has been literally nothing in the $700k – $750k anywhere.

    Now if we could just get a few more of those dots that seem to be clustering 20km from the city centre, say, about 5km from the city centre, then we’d be away and laughing. But I won’t hold my breath.

  3. 1500m isn’t an unreasonable distance to walk to a rapid transit stop. However there’s a lot of room for improvement that’ll get more people using PT (and more people able to live car-free):

    – Walking infrastructure availability needs to improve to expand the size of catchments for PT stations.
    – Walking infrastructure quality needs to improve so that all people feel safe using it (including disabled people, people traveling home alone at night etc).
    – Frequency and reliability of services needs to improve so users can be confident that when they turn up at a stop they won’t be waiting for long.

      1. Nice calls, Bear and goosoid.
        Paths to and from PT nodes need to be of high quality (smooth paths, ideally on direct routes) and feel safe (good lighting and sight lines, perhaps CCTV cameras in certain areas). If any of these are lacking, then you tend to lose ‘marginal users’ (people who are disabled, older, a lot of women, people with kids) as the psychological uncertainty and burden weighs on them, even if they want to use PT.

        The Council has the tools to resolve many of these issues (such as CPTED analysis) but as usual funding is the issue. Local boards are in the best position to fill in the many little gaps and solve little issues, but despite recent increases, their discretionary transport funding is still low (and AT’s costs are high).
        Are any of the leading mayoral candidates interested in boosting local democracy and problem solving by significantly increasing LB transport funding? Worth asking them IMHO…

        1. Well there is no point in giving more money for transport to the Devonport-Takapuna Local Board. They are absolutely useless and think it is still 1980.

          They only care about parking and keeping everything the way it has been. They fight all change for the sake of it.

          Bike Deonport lobbied the Local Board for 5 years to do some very small improvements to cycling, with no success.

          I would rather the money stayed at AT level so that actual change may have some chance of happening. I have no faith in Local Boards.

        2. +1

          All greenfield subdivisions should aim for this.

          For existing suburbs, AT may need to acquire access right for some properties to build a walking/cycling shortcut between cul-de-sac.

          That funding should be part of the ‘access improvement’ budget from AT to encourage access to rapid transit station.

  4. I’d be more interested in consents within half that distance – 750m as that is more realistic for the majority to consider PT.
    I still think that with rare exceptions the height limits should be removed within 250m of an RT route.

      1. Thanks. I hadn’t seen Ben’s thread but I had read the research. It seems to work backwards : it looked at the people using the stations and found out how far they’d come.

        I think it’d be more useful to look at the people who would like to use the station but don’t, and ask whether shorter distance, better amenity, or a combination of both, would make the journey possible.

        Alternatively, they could find out the distances people with limited mobility have come to us the station, and make that the goal.

        As it is, the research is based on finding out what suits the able bodied, and making that the goal.

  5. I see a steady increase since 2011. The increase was well underway before the UP came into effect. For some reason there was a little dip in that growth in 2017.

    Also, suggested headline: “3 out of 4 new houses not within reach of the rapid transit network”. I am not able to see any preference for purple areas on that dot map.

    1. It’s seems to be rapidly picking up recently rather than so much since the UP if I look at the graph, but bit early to tell perhaps. We have had uncertainty about a capital gains tax & other measures to limit overseas buyers and local investors, so pretty strong growth considering.

  6. I don’t understand the second to last paragraph where you claim more than 60% of development was within the urban area was the norm. Practically all development occurred within the Metropolitan Urban Limits with the vast majority of new dwellings either being in the CBD or in the greenfields bits located within the MUL. For years the ARC people had said future development would be 70% brownfields and 30% greenfields. The green areas would develop fully and the brown wouldn’t, then they would release more land and make the same claim over again. As for thinking everyone should live in a big house on the edge, that wasn’t people in favour of sprawl that caused that to occur. It happened that way because the anti-sprawl twits at the ARC limited land supply so sites got bid up so only massive houses made sense.

    1. Politics and influence have played an enormous part in Auckland’s form. The biggest players unsurprisingly have had the most influence.
      Fletcher’s Interests, for instance, are much better served by green field development with much more work for their infrastructure and roading divisions as well as their vertically integrated house building and building supply operations.
      They no longer have the expertise to handle High Rise construction and infrastructure provision in existing built up areas profitably.
      The suppliers of road based transport services supplys and equipment are similarly disadvantaged by intensification and mass transit as an alternative to green fields development and moar roads. They to, to date have been largely successful in advancing their interests.
      The point of this post, is to point out that Auckland’s form is the result of many factors but one of the most potent is the political influence of it’s construction and transport providers of the day.
      Gerry Brownlee/Stephen Joyce did not widen motorways without any public transport provision in a vacuum. This was in spite of the then proven success of Northern Busway.

      1. Yes the Busway that North Shore tried to pay their contribution for out of development levies they charged on greenfield housing located nowhere near it.

  7. Rather than the raw total, may I suggest plotting building consents per capita as an alternative metric?

    Standardising by population helps highlight identify trends in relative building activity over time. While data on raw consents looks impressive in a historical context, Auckland’s population is now much larger now than it was — and should support more building activity as a consequence.

    When you standardise by population, you’ll see that we’re just approaching the 2003 construction peak. Also, the fact prices haven’t fallen in a meaningful sense also suggests we’re not yet eating into the shortage that exists.

    Basically, while trends are heading a good direction, I’d argue we need to keep hitting records for the next year or so if we’re going to get housing prices back to a reasonable level.

  8. Looking at the numbers it seems the private market economy is working and the supply is ramping up the fill the demand.

    After all, we may not need the Kiwi-Build that builds things that no body wants.

    1. Maybe supply some data on how many of these new consents are purchased by first time buyers? Without any CGT a lot of these new builds could well be being bought off the equity of existing home owners…which isn’t exactly Market meeting demand.

      Might not be the case, just saying…

      1. You would be mad to buy a house as a rental in Auckland. The rental returns make for a poor investment based on what you would pay for the house at the moment and there is not much sign of capital gains in the near future to make up for this.

    2. A lot of kiwi builds coming out soon in closer proximity to city. Will be interesting to see if they sell well.

  9. I found it interesting that Vector ,made11,500 new connections in 2018 it seems to me that the response to the housing shortage has really been effective.

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