“New Zealand Local Government Needs To Face Reality”
“ Local Government New Zealand needs to face reality and recognise that it must play a constructive role in solving New
Zealand’s housing affordability crisis. It must know that in 1991, New Zealand’s homeownership rate was one of the
highest in the world at 74% in 1991 and is projected to slip to 63% by 2011” said Hugh Pavletich, co author of the 2006
Demographia International Housing Affordability Survey www.demographia.com , released this week.
The Demographia Survey found that all the major urban centres in New Zealand are “severely unaffordable” and that there
has been a serious deterioration in affordability over the past twenty years. Affordable cities should have house
pricing at no more than three times household income. Auckland is currently at 6.6; Wellington at 5.2 and Christchurch
5.9 as at September 2005.
Mr Pavletich is of the view that the Demograhia Survey clearly illustrates that well governed urban areas
internationally, are achieving housing affordability standards of 3 times household income and that historically, most
urban areas achieved this.
“Instead of reacting negatively to the Survey, Local Government should work with the community and explore ways to solve
this issue”
He is of the view that there is an urgent need for local governments throughout New Zealand, to use the Demographia
Survey as a guide, in identifying the degree of affordability in each area. From this, the problems can be clearly
identified so that communities themselves can find solutions, to ensure that within a reasonable time, their
affordability levels do not exceed three times household income.
“ We know from our exhaustive global research, summarized within the 2006 Demographia Survey, that land supply is the
root of the problem. Importantly too, that there are urban areas currently achieving sustainable affordability levels,
as we did historically” said Mr Pavletich, adding “Mr Morrison of Local Government New Zealand needs to show more
confidence in the capacity of his fellow New Zealanders and in our ability to work together, in solving this issue.”
ENDS