National leader prepares to force Willis & Bishop to abandon their bipartisan 'Townhouse Nation' policy aimed at boosting housing supply; Luxon capitulates to National's NIMBYs and land-bankers
Another sign that National is no longer the party of farmers and rural NZ - greenfields developments swallow up key productive horticultural land. This is a party that no longer has a farmer as agriculture spokesperson - as they don't have any. National is now an ersatz Auckland party... and only one part of Auckland at that.
Seems quite unreasonable to blame a PPP for all Transmission Gully delays, given that much of skilled workforce got sent home overseas during the 2+ year COVID border closure.
This was a government decision, and delayed the projects but also allowed partly finished work to be left untended for long periods. Surely that isn't a PPP issue
The "Holiday highway" north of Auckland is 15 months late. Shall we blame ACC, Fletchers or Acciona for that?
Christopher Luxon saying he is "ruthlessly obsessed” with building houses, while also bending to NIMBYS, shows why there is low approval for him. This is a policy to get ACT voters back, but will harm the middle vote.
I’m really pleased you are allowing non paying to read this. It’s appalling our housing market for anyone in the upper middle to rich (yes I’m one!). I totally agree with duplex 2 storey housing in my neighbourhood and whatever else is required. I would hate for my grandkids kids to be in a bitter hostile them and us environment over houses. There is and always has been room for everyone
It seemed to me one of the big problems with the MDRS is (or was) it is limited to dwellings and Lots, nothing on neighbourhoods when it got to actual ‘planning’. People were left to imagine anything that could incite opposition.
What this is showing is the end result of thirty years of incompetent political leadership from both parties - but he is not wrong - our cities are plumbed and wired for 10 house to the hectare and when you put the equivalent of 30 or more houses per hectare the entire system needs rewired and replumbed (and reroaded and re drained etc) it is vastly more expensive to retrofit an urban area than it is to build one from scratch. (Im a former council CEO so know these issues well ). '
The other problem is that each new household requires about $200k of additional infrastructure but successive governments have expected those already living in these areas being intensified to carry the cost of all of servicing all of these new residents meanwhile requiring them to tolerate a severe degradation in the quality of their living environment as it becomes cluttered with buildings and the greenness of the living environment disappears and service levels deteriorate.
The other major problem with retrofitting urban infrastructure is that most networks require to be installed with large increments in capacity - when a system is running at 110% of design capacity you don't replace it with something that has 115% you put in 2-300% to cater for future growth - the problem with this is that is then you have to have a major philosophical discussion with your council and community - neither of whom want to pay for this investment - which is nothing more than a subsidy or transfer of wealth from existing residents to future residents - about how much growth is going to occur during the expected life of the asset - which at best is a blind guess because this growth tends to be determined at the whim of the headless chickens housed in the Beehive who turn the migration taps on and off as suits the political agenda (or the noisiest vested interest) of the day.
If we had any honest politicians they would have a discussion with the rest of as to just how many people we want to share this little pair of natural disaster prone islands with - and Maori haven't got over the idea of having to share it two centuries after the last flood of uninvited new arrivals. But just as with our present leadership - their leadership saw riches and conquests to be had by allowing migration and went back to fighting their old enemies with a renewed enthusiasm enhanced by modern weapons obtained by trade and selling land only to find that when they finally fought themselves to a standstill that their old world was gone - too late to do anything about it. There be a lesson for us all.
I had a chat to national MP Michael Woodhouse a while back about some planning matters and he started going on about how he thought NZ should have a population of 25 Million - I suspect a very large majority of kiwis of all stripes would disagree strongly with that - but he has no intention of asking us our opinion. And that is our problem.
Frustratingly, that very audience in Birkenhead and the swathes of near and already retired voters and NIMBYS so accepting of a move away from infill housing will undoubtedly be spending every other moment discussing how their kids and grandkids have moved to Sydney, Melbourne, Dubai or elsewhere to simply make a living.
"New Zealand is too bloody expensive" and "I don't blame them for staying away" rings out across the coffee club while at the same time they're supportive of policy that will only exacerbate the issues, drive NZ down the rankings for equality, equity and affordability and smash that house price-to-income ratio into the record books again.
It's not only this infill/greenfields debate but also the interest deductibility rules. taxation of capital gains and preference for no shift in taxation over using that as ONE possible lever in solving the infrastructure and other underinvestment issues we face. Mind-numbing.
and if these characters are really interested in fixing the housing situation you would think they would think twice about putting out new building codes that add huge increments of cost to new builds. Im building in coastal Otago, if I had started after March 1 the build would have cost 15% more ($70,000!!!!) just to comply with the new insulation requirements. For my build to comply would require it to contain 50% more timber 50% more glass 50% more insulation - that is building two houses post the new code will consume as much material as building three houses before the code change. My new home is toasty warm - it doesn't need more insulation. For the additional cost of complying with the new code I could have installed a HUGE rooftop solar system and exported power to the grid and run a heat pump all winter - this country will be brought to its knees but a vast raft of ill-considered regulations that seem to do nothing but further the vested interests of the parties who have promoted the regulatory changes - Facebook is full this week of glazing manufacturers crowing about the wonders of triple glazing - and their comments section are full of comments disagreeing with the code . You would get a greater improvement on the thermal performance of a house by having good drapes over double glazing for a fraction of the cost.
Interesting (if a bit depressing). We really seem to want to achieve a European style country, with American values (tax me less, give me a big section and car, it’s all about me). It can’t happen because they’re so contradictory. To your very last comment - maybe, National in their current form won’t get back in again. If they don’t win this time or next, in 6/7 years a lot of the bowling club committee types won’t be around anymore and National will need a vastly different approach
Maybe Luxon's comments about encouraging greenfield development won't go over quite so well as he hoped? Seems like many prospective National party voters are concerned about encroachment on farmland
As someone who project and development manages 300+ houses a year for social housing providers and private developers, I feel I can talk with more experience than most, and the town house nation - build 3 or more houses anywhere is a disaster, the sites that get developed first are those with enough or cheap infrastructure to develop, or that you can acquire for sub $800m2. There is a reason why South and West Alk get thrashed with in-fill housing and the expensive inner suburbs (which should be the ones being developed) don't - and it's all to do with economics of land and services to them. At the moment you have unlimited land that can be developed - I live in a leafy Mt Eden street, that according to planning rules say 1,000's of new houses could be built in my street, but it will never happen (and it will stay villas and bungalows on 900m2+ sites), as this is the land's highest economic use, as the land is uneconomic to develop and provide the infrastructure. They need to limit and target the areas of land intensification (i.e Mt Eden Rd, Dominion Rd, Sandringham Rd etc, as the limitation in land supply will make those areas feasible, and the transport and services infrastructure is there. Instead - the infill housing is going to the 'whops' like Kemeu, Flatbush, Swanson, Drury etc - where cars just create more congestion as you can't get a bus to where you need to go (without taking several), as these people don't need to go to Britomart. It's a total mess - limit the development to the areas with the network and infrastructure already in place, to get the benefit - blanket development just creates future slums in already cheaper suburbs and a greater social divide in time.
If you want to make housing cheaper - hit the infrastructure connection fees and funding costs. It costs $16K incl GST for a water connection per house (why, when is was $2K 20 years ago? - Bernard - why do you not take the greedy Watercare to task on this - instead of just ute owning land owners?), $22K for a development contribution, $8K for a building consent, anywhere between $7-50K for power connection per house (Bernard - I was in a Vector meeting recently explaining that having to pay $50K per house for power connections for a social housing development was just insane - this was in Mangere, a well established suburb, not exactly the outskirts?) , and the list goes on. Housing is a social good - so why do we not socialise the cost (instead of user pays). I kinda agree with Bernard's land tax, but where I disagree with him is it should be an occupants tax, so every household pays (say $500 yr) to subsidise these costs, instead of loading $50K+ onto every single house (a very fast way to drastically reduce building costs). Something else to consider is the Govt using their cheap lending rates and create a "Ministry of Development Funding" - doing developments at say 5% interest Vs bank and second tier stacked funding of currently 15%+ instantly makes houses 10% cheaper to produce too? On a $700K home the funding costs to a builder are a ridiculous $70-100K? So why not look at ways to solve this. The cost is actually greater when you consider the same interest costs applied to the land developer - the cost of funding is circa 20% of the total house cost (from raw land).
When you have 22+ million dollars of property....I’d call that a vested interest!!!
He was always going to wind that back so no big surprise there!!
Another sign that National is no longer the party of farmers and rural NZ - greenfields developments swallow up key productive horticultural land. This is a party that no longer has a farmer as agriculture spokesperson - as they don't have any. National is now an ersatz Auckland party... and only one part of Auckland at that.
Seems quite unreasonable to blame a PPP for all Transmission Gully delays, given that much of skilled workforce got sent home overseas during the 2+ year COVID border closure.
This was a government decision, and delayed the projects but also allowed partly finished work to be left untended for long periods. Surely that isn't a PPP issue
The "Holiday highway" north of Auckland is 15 months late. Shall we blame ACC, Fletchers or Acciona for that?
Christopher Luxon saying he is "ruthlessly obsessed” with building houses, while also bending to NIMBYS, shows why there is low approval for him. This is a policy to get ACT voters back, but will harm the middle vote.
I’m really pleased you are allowing non paying to read this. It’s appalling our housing market for anyone in the upper middle to rich (yes I’m one!). I totally agree with duplex 2 storey housing in my neighbourhood and whatever else is required. I would hate for my grandkids kids to be in a bitter hostile them and us environment over houses. There is and always has been room for everyone
Oops I left some words out...I haven’t got my glasses on, apologies
It seemed to me one of the big problems with the MDRS is (or was) it is limited to dwellings and Lots, nothing on neighbourhoods when it got to actual ‘planning’. People were left to imagine anything that could incite opposition.
As a subscriber I’m happy to see you experimenting with the paywall/subscription model. Good luck and let us know how it goes!
What this is showing is the end result of thirty years of incompetent political leadership from both parties - but he is not wrong - our cities are plumbed and wired for 10 house to the hectare and when you put the equivalent of 30 or more houses per hectare the entire system needs rewired and replumbed (and reroaded and re drained etc) it is vastly more expensive to retrofit an urban area than it is to build one from scratch. (Im a former council CEO so know these issues well ). '
The other problem is that each new household requires about $200k of additional infrastructure but successive governments have expected those already living in these areas being intensified to carry the cost of all of servicing all of these new residents meanwhile requiring them to tolerate a severe degradation in the quality of their living environment as it becomes cluttered with buildings and the greenness of the living environment disappears and service levels deteriorate.
The other major problem with retrofitting urban infrastructure is that most networks require to be installed with large increments in capacity - when a system is running at 110% of design capacity you don't replace it with something that has 115% you put in 2-300% to cater for future growth - the problem with this is that is then you have to have a major philosophical discussion with your council and community - neither of whom want to pay for this investment - which is nothing more than a subsidy or transfer of wealth from existing residents to future residents - about how much growth is going to occur during the expected life of the asset - which at best is a blind guess because this growth tends to be determined at the whim of the headless chickens housed in the Beehive who turn the migration taps on and off as suits the political agenda (or the noisiest vested interest) of the day.
If we had any honest politicians they would have a discussion with the rest of as to just how many people we want to share this little pair of natural disaster prone islands with - and Maori haven't got over the idea of having to share it two centuries after the last flood of uninvited new arrivals. But just as with our present leadership - their leadership saw riches and conquests to be had by allowing migration and went back to fighting their old enemies with a renewed enthusiasm enhanced by modern weapons obtained by trade and selling land only to find that when they finally fought themselves to a standstill that their old world was gone - too late to do anything about it. There be a lesson for us all.
I had a chat to national MP Michael Woodhouse a while back about some planning matters and he started going on about how he thought NZ should have a population of 25 Million - I suspect a very large majority of kiwis of all stripes would disagree strongly with that - but he has no intention of asking us our opinion. And that is our problem.
Frustratingly, that very audience in Birkenhead and the swathes of near and already retired voters and NIMBYS so accepting of a move away from infill housing will undoubtedly be spending every other moment discussing how their kids and grandkids have moved to Sydney, Melbourne, Dubai or elsewhere to simply make a living.
"New Zealand is too bloody expensive" and "I don't blame them for staying away" rings out across the coffee club while at the same time they're supportive of policy that will only exacerbate the issues, drive NZ down the rankings for equality, equity and affordability and smash that house price-to-income ratio into the record books again.
It's not only this infill/greenfields debate but also the interest deductibility rules. taxation of capital gains and preference for no shift in taxation over using that as ONE possible lever in solving the infrastructure and other underinvestment issues we face. Mind-numbing.
and if these characters are really interested in fixing the housing situation you would think they would think twice about putting out new building codes that add huge increments of cost to new builds. Im building in coastal Otago, if I had started after March 1 the build would have cost 15% more ($70,000!!!!) just to comply with the new insulation requirements. For my build to comply would require it to contain 50% more timber 50% more glass 50% more insulation - that is building two houses post the new code will consume as much material as building three houses before the code change. My new home is toasty warm - it doesn't need more insulation. For the additional cost of complying with the new code I could have installed a HUGE rooftop solar system and exported power to the grid and run a heat pump all winter - this country will be brought to its knees but a vast raft of ill-considered regulations that seem to do nothing but further the vested interests of the parties who have promoted the regulatory changes - Facebook is full this week of glazing manufacturers crowing about the wonders of triple glazing - and their comments section are full of comments disagreeing with the code . You would get a greater improvement on the thermal performance of a house by having good drapes over double glazing for a fraction of the cost.
Interesting (if a bit depressing). We really seem to want to achieve a European style country, with American values (tax me less, give me a big section and car, it’s all about me). It can’t happen because they’re so contradictory. To your very last comment - maybe, National in their current form won’t get back in again. If they don’t win this time or next, in 6/7 years a lot of the bowling club committee types won’t be around anymore and National will need a vastly different approach
Maybe Luxon's comments about encouraging greenfield development won't go over quite so well as he hoped? Seems like many prospective National party voters are concerned about encroachment on farmland
Wonder when the penny will drop to all the prospective Wellington based top voters that raj manji opposes MDRS for NZ’s second largest city
As someone who project and development manages 300+ houses a year for social housing providers and private developers, I feel I can talk with more experience than most, and the town house nation - build 3 or more houses anywhere is a disaster, the sites that get developed first are those with enough or cheap infrastructure to develop, or that you can acquire for sub $800m2. There is a reason why South and West Alk get thrashed with in-fill housing and the expensive inner suburbs (which should be the ones being developed) don't - and it's all to do with economics of land and services to them. At the moment you have unlimited land that can be developed - I live in a leafy Mt Eden street, that according to planning rules say 1,000's of new houses could be built in my street, but it will never happen (and it will stay villas and bungalows on 900m2+ sites), as this is the land's highest economic use, as the land is uneconomic to develop and provide the infrastructure. They need to limit and target the areas of land intensification (i.e Mt Eden Rd, Dominion Rd, Sandringham Rd etc, as the limitation in land supply will make those areas feasible, and the transport and services infrastructure is there. Instead - the infill housing is going to the 'whops' like Kemeu, Flatbush, Swanson, Drury etc - where cars just create more congestion as you can't get a bus to where you need to go (without taking several), as these people don't need to go to Britomart. It's a total mess - limit the development to the areas with the network and infrastructure already in place, to get the benefit - blanket development just creates future slums in already cheaper suburbs and a greater social divide in time.
If you want to make housing cheaper - hit the infrastructure connection fees and funding costs. It costs $16K incl GST for a water connection per house (why, when is was $2K 20 years ago? - Bernard - why do you not take the greedy Watercare to task on this - instead of just ute owning land owners?), $22K for a development contribution, $8K for a building consent, anywhere between $7-50K for power connection per house (Bernard - I was in a Vector meeting recently explaining that having to pay $50K per house for power connections for a social housing development was just insane - this was in Mangere, a well established suburb, not exactly the outskirts?) , and the list goes on. Housing is a social good - so why do we not socialise the cost (instead of user pays). I kinda agree with Bernard's land tax, but where I disagree with him is it should be an occupants tax, so every household pays (say $500 yr) to subsidise these costs, instead of loading $50K+ onto every single house (a very fast way to drastically reduce building costs). Something else to consider is the Govt using their cheap lending rates and create a "Ministry of Development Funding" - doing developments at say 5% interest Vs bank and second tier stacked funding of currently 15%+ instantly makes houses 10% cheaper to produce too? On a $700K home the funding costs to a builder are a ridiculous $70-100K? So why not look at ways to solve this. The cost is actually greater when you consider the same interest costs applied to the land developer - the cost of funding is circa 20% of the total house cost (from raw land).