How do you fix Auckland's housing crisis?

21:00, Jan 28 2013

By Joseph Bergin

I can't personally understand why such a simple problem provokes such cautionary responses from many politicians. I think in general it's really all down to some not quite understanding what we mean when we say 'housing crisis'. So let's spell it out.

Really, it all comes down to housing affordability. Like with anything else in the marketplace, when there are more people wanting to own houses than there are houses to own, buyers bid up the price of those houses up for sale. When the price rises faster than incomes, then it becomesmore difficult, if at all possible, to put the money together to be able to purchase a house. Now for people like my dad who likes to tell me it was just as hard in his day, consider that over the last 30 years, we've seen the average house price going from two times the median income to 5.3 times today's median income, and according to the Demographia 2013 Study, anything more than three times is unaffordable.

So then, how to fix it? Traditional logic says you can reduce how much demand there is for buying houses through the Reserve Bank increasing the country's Official Cash Rate, essentially making it more expensive to take out a mortgage and more attractive to put it into savings, and hey, in times gone by that may have worked, but now we have a lot of overseas buyers who are impervious.

To be honest, the best steps to take are to increase supply. In theory this is where we should be able to rise to the challenge... At least if someone could please tell Auckland Council that! Despite Labour's recent announcements of a fanciful idea for central Government to become a taxpayer-funded property developer, the best thing Government, local or central, can do is get out of the way. The private sector is better at it and more efficient.

The facts are these; there is too little land allocated for development; too much red tape; and too much opposition from local councils to denser developments. Coming from a community faced with the prospect of compensating for the rest of Auckland's poor growth planning the answer to the crisis seems obvious. Councils need to cut all the unnecessary costs and multiple delaying tactics associated with any build, we need to see more reforms to the Resource Management Act and councils need to realise that developers are people too and stop being so stubborn, stamping their feet and telling developers what to do, it's not their place.


But then again, what do I know.

» Joseph Bergin is a born and raised Shore boy and the youngest elected member of the Auckland Council. Sitting on the Devonport-Takapuna Local Board, he has a history of working with grassroots youth not-for-profits on the Shore.

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By Richard Hills

Housing affordability and availability has reached crisis point in New Zealand, in Auckland demand exceeds supply and needs to be addressed now.

House prices and rents are increasing rapidly; many families and a majority of young people see home ownership out of reach, especially saving a deposit while paying high rent, many rentals are damp and cold, creating bigger social issues. Community group Lifewise will tell you homelessness is increasing, with families living in cars or garages and the noticeable number of Kiwis sleeping rough on our streets.

We need to be hands on; relying on market forces to fix this has failed. Government and Auckland Council must work together to ensure emergency accommodation and more state rentals are available. WOFs for cars help save lives and money, yet why do we resist this idea for housing which could save us all billions a year in health and poverty-related costs? Crucially, we need to actually build affordablehomes for Kiwis to buy.

The other argument to increase urban sprawl and build more subdivisions outside the city fringe will only increase travel costs, put more cars on our all ready clogged roads and increase the cost of building and maintaining new infrastructure such as storm water and roading. Not to mention the reduction of agricultural land which we still rely heavily on for growth, exports and food production.

As a council, we need to lead a culture change, involving our communities' ideas in the process. We need everyone to look seriously at the fact that over the next few decades we need to make our town centres and transport nodes more compact, encourage well-designed, liveable and energy efficient homes, including terraced housing and apartments. It doesn't mean build high rise towers or jamming people in but if we have more people in one place we can have cheaper and more sustainable transport options, more open space and encourage walking and cycling to the shops or local school instead of sitting in traffic for an hour every time you leave the house. It will also give people the choice to buy a smaller home and get on the property ladder and reduce their cost of living.

Yes much of this comes with a cost, but the cost of doing nothing is much higher, especially in the areas of health, child poverty, employment, retirement security and the loss of many of our friends and family overseas, where to them the future seems brighter.

» Kaipatiki Local Board Member Richard Hills, born and bred in Glenfield, is responsible for the Youth, Community and Social Development and Events portfolios. He works part-time as a Community Health Worker, predominantly working with young people across wider Auckland.

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