The cost of properties with over-inflated price tags can be
brought down with a rapid increase of high rise apartment
blocks and granny flats, according to an expert speaking at a
property seminar in Wellington tonight.
Local Government New Zealand president Lawrence Yule will
lead a panel discussion on housing affordability with Finance
Minister Bill English, Auckland Council Deputy Mayor Penny
Hulse, economist Arthur Grimes and New Zealand Council for
Infrastructure Development chairman John Rae.
A new OECD report shows homes in New Zealand are the second
most expensive in the developed world, based on the ratio of
price-to-income, and the most-overvalued relative to rents.
Dr Grimes, a senior fellow at Motu Economic and Public Policy
Research, said popular cities and towns could bring down
house prices by rapidly expanding the number of properties
for people who were not just there at the moment, but also
those who wanted to come in the future.
If the rate of houses being built was not meeting those
numbers then, "it's going to be expensive", he said.
If local governments were resistant to more houses being
built in their towns and cities, they needed to be explicit
with their communities by saying they had decided to be
smaller but expensive, Dr Grimes said.
Councils that wanted to increase housing quickly should allow
for more apartment buildings and granny flats, he said.
"For instance in Christchurch you can't (build) a granny flat
and keep it there, you have to remove it even though they're
short on houses.
"If you want to allow more people in, you've got to allow
some of these things to happen."
Auckland Deputy Mayor Penny Hulse said there was high
interest in residents and migrants looking for apartment life
in the city.
The council's proposed Unitary Plan allowed for
intensification of housing, such as splitting one house into
two, and building granny flats and apartment buildings.
There was demand for new apartment blocks, in areas such as
New Lynn, Ms Hulse said.
Migrants and residents aged over 50 were looking for those
smaller homes in good areas, she said.
There were some ways other councils around the country could
provide "stepping-stone" properties for first-time buyers,
"There aren't enough choices for first home buyers by the way
of good choices in apartments or terraced housing or
otherwise houses that allow them to build equity in them
Local Government New Zealand president Lawrence Yule said
there was an "overheated" housing problem in Auckland,
Christchurch, Queenstown and parts of Tauranga.
There needed to be better cooperation between central and
local government to accommodate the housing shortage in those
areas, he said.
If housing "sprawls out" too much, the cost of the extra
infrastructure was not worth it for councils, he said.
"We don't support a cart blanche expansion."
Plans to tackle housing problems in cities such as Auckland
should have been happening 10 years ago, Mr Yule said.
"But it's better late than never."
There needed to be a "proper plan for New Zealand's growth",
"The demographic changes in New Zealand are significant; not
only the aging population, but in the drift towards urban
centres and the northern drift.
"And a balanced growth across New Zealand is probably the
most efficient way for the country."
- By Rebecca Quilliam of APNZ