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SHA housing in limbo?

JAMES IRELAND AND SIMON SMITH
Last updated 09:12 12/08/2014
Weymouth special housing

COMING SOON: The first house in the Weymouth Special Housing Area is expected to be finished by Christmas.

Phil Twyford
BOTH SIDES: Phil Twyford wants the focus to be on both the supply and the demand for Auckland’s houses.

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Are the first cracks appearing in the much-trumpeted plan to solve Auckland's housing crisis?

Developers at four of the 63 Special Housing Areas (SHAs) across the city have pulled out of the new fast-track consent process, the Auckland Council confirms.

And planning consultant Jon Maplesden, who has clients within SHAs, says he knows of several more developers who are unhappy and others who are "just not even bothering with it".

Their reasons include frustration with infrastructure provision and the cost of providing the stipulated "affordable" housing.

Developers are opting out at the Murphy's Rd site in Flat Bush with capacity for 275 houses; Addison in Takanini, 500 houses; Anselmi Ridge in Pukekohe, 150 houses; and the Millwater section of Silverdale North, 472 houses.

Mayor Len Brown remains confident Special Housing Areas are an effective way to tackle the housing crisis.

"We do everything we can to put the right regulatory framework in place for the private sector and then the private sector builds on it.

"If they get a consent and then don't build, what do we do? Bring out a big stick and beat them around the head? The only thing we can control is the zoning, planning and resource consent."

Maplesden says some landowners haven't applied for SHA status to build houses but to add value to the land.

"There's a number of them that I know are trying hard to sell them."

The council confirms the land in the Albany Highway SHA has been sold.

Housing developments in Takanini and Pukekohe are being built by McConnell Property and its plans were already well advanced before the areas were designated as SHAs, marketing manager Jo Anderson says.

"To redesign would be further time and cost to do so. On these multi-stage developments, the local staff had been involved in the development for a number of years and stages, so for consistency we preferred to have those personnel also process any new resource consent applications."

Maplesden says developers who apply for fast-track consent for, say, 500 houses, won't be building all of those houses at once. Historically there are "very few" projects that have built at a rate of more than 100 houses per year, he says.

"No developer, not even Fletchers, can afford to do a 500-lot development all at once."

So a 3000-dwelling SHA could take 30 years to complete, he says.

Labour Party housing spokesman Phil Twyford says supply is only one side of the problem.

"The demand side needs to be looked at too. We have property speculators buying up everything and driving up prices," he says.

"This is the central piece of the Government's response to the housing crisis and 14 months after they pushed it through, the policy hasn't delivered anything. They still can't point to a single house."

But Brown says the first SHA house in Weymouth will be ready for its new owners to move into by Christmas.

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The Auckland Housing Accord identifies a shortfall of up to 30,000 dwellings and a need for 13,000 new homes a year for the next 30 years. Statistics NZ data shows just 6827 Auckland dwellings were given building consent in the year to July.

'THERE'S NO SINGLE SOLUTION'

The price of a so-called affordable house planned for Auckland is up to $427,500.

Provision has to be made for affordable housing in any SHA development with more than 15 dwellings.

If the houses are being built by a private developer, 10 per cent must be sold for "no more than 75 per cent of the Auckland region median house price" - $427,500.

If a community housing provider or Housing New Zealand is building the homes, 5 per cent of the houses must cost less than a price based on interest rates and the median household income - $343,750.

Housing Minister Nick Smith said there is no single solution to improving housing affordability.

"We are freeing up land supply, reining in development contributions, cutting compliance costs and investing in skills and productivity in the construction sector."

Mayor Len Brown is expecting the SHAs will provide apartments starting at $250,000.

"If you can't deliver that, there's something wrong."

He said he had to argue strongly with the Government to get the affordable housing provisions in place.

"If Auckland housing is to get sorted, we need to be able to build at the lower end of the value chain."

The Government's 2014 budget announced a temporary freeze on import tariffs for building materials, a move expected to lower the cost of building a house by $3500. At the same time, Watercare raised its fee for new water connections from $9775 to $12,075.

Brown feels like he can't win.

"Whichever way we look we are being told not to have large rate increases and cut our costs and the consenting time.

"But as soon as we try to recover our costs we're also criticised. We're damned if we do and damned if we don't."

WHAT IS A SPECIAL HOUSING UNIT?

Mayor Len Brown and Housing Minister Nick Smith signed the Auckland Housing Accord in October last year.

Its key aim is increased housing affordability and greater access to housing for first home buyers.

Special Housing Areas (SHAs) are parcels of land suitable for housing development with some provision for business and community services.

Once the council has identified an area it wants to turn into an SHA, the Government must agree.

Property owners within the SHAs can set out their plans for development which must be mainly residential and have the capacity for 50 or more dwellings in greenfield areas or four or more dwellings in brownfield areas.

If accepted the development can pass through a streamlined consent process. It will take a maximum of 130 days instead of up to four years for plan changes and subdivision under the standard process. The accord sets the target of approving 39,000 resource consents and new sections in three years with 10,000 expected to come from SHAs.

There are no targets for the number of houses to be built. The latest monitoring report says in its first year the number of new sections created is expected to be 400 more than the previous year.

Over the next 12 years 73,000 new dwellings are known to be in the pipeline and 30,000 are expected to come from SHAs.

- Manukau Courier

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