How to reduce Auckland house prices
Arthur Grimes, the former chair of the Reserve Bank board, caused a stir with his proposal to crash Auckland house prices by 40% by building lots more housing:
My call for policies to drive a house price collapse is driven by my personal value judgement that it’s great for young families and families on lower incomes, to be able to afford to buy a house if they wish to do so.…
Remember the last time house prices crashed 40%?
More commentary on this later on, but for now I’m just going to drop in some data.
Former Reserve Bank chair Arthur Grimes commented last week in The Spinoff:
In March 2016, the REINZ Auckland median house price reached $820,000. Four years previously, it was $495,000 – that’s a 66% increase in 4 years.…
Geography and housing supply dynamics
Last week, I introduced the concept of elasticity of supply with respect to price as a useful measure of housing market dynamics. Supply elasticities measure how responsive builders are to an increase in demand. In other words, when people turn up wanting dwellings, how quickly do the tradies start building more?…
Briefing papers 2: “Understanding housing affordability”
AUT’s Briefing Papers initiative has kindly allowed us to syndicate their recent series on housing. The second briefing paper is written by Motu Institute economist Arthur Grimes: Housing affordability is a multi-faceted, complex issue. Concentration on just one aspect of the issue – be it housing supply, land supply, interest rates, construction costs or migration – will miss important aspects of why house prices vary in different locations at different times.…
The urban planning conundrum
Since I moved to Auckland, I’ve been trying to make sense of local trends in house prices. Why have they risen over the last decade? Will they keep going up, or crash back down to earth? What’s driving all this?
Over the last few years, a lot of the focus has been put on the role of planning regulations in pushing up prices.…
Parking is massively oversupplied in US cities
When people discuss the costs of car-centric transport systems, they tend to tend to talk about congestion, fuel costs, crashes, or, if they’re environmentally-minded, carbon emissions.
However, one of the largest costs of auto-dependency is hidden in plain sight: the cost of providing parking spaces.…
What will happen as we build our “missing modes”?
Last year I started to take a look at demand for new transport investments. I found that demand for toll roads has massively underperformed, showing that people are unwilling to pay for new roads. On the other hand, demand for new public transport facilities has taken off more rapidly than projected.…
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