"NZ Governments Housing Affordability Package Pathetic”
says Demographia
HonMaryan Street, New ZealandHousing Minister today released details of the Affordable Housing Territorial Authorities Enabling Bill, intending to give Local Authorities powers
forcing home builders to include a percentage of smaller, poorer quality affordable houses within developments, so long
as the exterior appearance looks similar to other more expensive houses.
The Ministers officials are of the opinion (with no evidence or details provided) that this will create around 1000
affordable housing units per year. An “affordable example” of $350,000 is suggested within a development where the
balance of the housing averages $450,000.
“This pathetic initiative by Maryan Street, New Zealand’s new Housing Minister, is by far the worst I have seen by any
politician in the western world in recent years” said Hugh Pavletich, co author of the Annual Demographia International Housing Affordability Survey , adding “She has obviously deliberately chosen to ignore all the reputable national and international research on this
issue”.
International research clearly illustrates that these types of interventions drive up the cost of housing and severely
suppress the numbers of new houses built. For example - the San Francisco Bay area (with a population of 7.2 million
people) has put in place on average 278 affordable units a year since 1973. California’s build rate at 3 units per 1000
population per year is currently half New Zealand’s at 6 per 1000 population. (Refer further information below).
The Ministers states that she was influenced by British examples as well. British housing is currently in serious crisis
and is regarded as the worst standard housing in the western world. On a population basis, the British are putting in
place half the new houses New Zealand is. On average, the new British houses are one third the size of the new New
Zealand ones at 76 square metres.
“Obviously Maryan Street is aiming to put half our residential builders out of work, send them to Australia and deny
even more young New Zealanders their right to the opportunity of affordable housing” Mr Pavletich said, adding “What
this means is driving down our housing construction from around 24,000 units a year towards 12,000 a year mark – just
when we desperately need even more affordable housing – of between $140,000 to $180,000 on our urban fringes.
Demographia research has concluded that the focus must be on firstly, setting performance standards for Local
Government, secondly releasing fringe land and thirdly, appropriately financing infrastructure.
“This could have been an opportunity for New Zealand to widen its “affordability advantage” over Australia, to encourage
more young New Zealanders to stay near family and make their futures in this country. Sadly, Ms Street and the Labour
Government have failed them” said Mr Pavletich.
Hugh Pavletich
Co author – Annual Demographia International Housing Affordability Survey
Further information……….
(2) The Top 10 myths of housing and urban planning policy Refer Myth 9 - RDC Australia publication
(8) CHRANZ Research Feb 2006 - Land Supply Key Problem (ignored by Housing Minister Maryan Street)
ENDS