Housing targets have long been a political football – and an emotional subject. Would it not be better to take some of the heat out of the housing debate and ask more systematically how we could better plan for future housing supply?
The housing target for Auckland shrank twice in mere weeks as central government searched for a politically acceptable number. But planning-by-numbers is part of the problem.
Auckland met its housing capacity targets for years by claiming it had zoned enough land to accommodate population increases, but house prices kept climbing. Environment Court Judge Jackson compared the approach to “the Soviet model of setting aside X hectares for the production of pig iron.” Auckland’s Unitary Plan improved matters but falls short of where we need to be.
During his New Zealand visit earlier this year, urbanist Alain Bertaud argued that forecasts baked into regulation straitjacket cities. When a forecast becomes a headline, it also becomes a political weapon. Minister Bishop’s own description of the two million figure as “a red herring that transformed into a lightning rod” proved Bertaud right.
Price-based measures are a more effective approach. Instead of asking whether councils have planned for the “right” number of houses, ask whether people and businesses have real and affordable choices or are forced into bidding wars over scarce permissions, jacking up prices.
A four-stage process can do this.
First, calculate how many people the existing transport and utility networks can support. Make that capacity the minimum zoning floor. If infrastructure capacity exceeds already zoned capacity, zoning can be eased. If zoning exceeds that infrastructure capacity, infrastructure needs improvement.
Second, map where buyers pay premiums for location alone, and compare that against zoning. That shows whether councils are allowing development where people want to be, or whether they are being pushed into low-demand areas.
Third, divide land price by permitted floor space. When the rules limit land from desired use, land prices get high relative to floor space.
Fourth, measure price 'cliffs' at zone boundaries and the urban-rural edge. Large differences mean the rules are too tight and that land is being rationed.
An independent expert panel of urban economists should track these indicators using real sales data and overrule bad planning.
Housing will always be political, but an expert panel would put a layer between communities and politicians so that decisions do not directly expose ministers. It would also shift the focus from headline numbers to the real question: Do the rules make our cities more affordable and productive?
This approach would make housing debates calmer, more rational and conducive to delivering the housing outcomes New Zealand needs.
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