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Dunedin's housing ‘‘crisis’’ will get worse before it gets better, Mayor Aaron Hawkins says.
He was commenting on new figures from CoreLogic which showed the average price of a house in Dunedin had jumped 18% and, at $514,680, was now above that found in Christchurch ($507,852).
Mr Hawkins said a lack of new housing, including greenfields developments, was one factor driving up prices, but there was no quick fix.
‘‘I’d be surprised if this didn’t get more challenging before it started heading in the right direction,’’ he said.
The council had recently resolved an appeal against the city’s second generation district plan (2GP), which had been blamed for holding up the development of hundreds of new homes.
However, dozens of others were still being worked through, including one standing in the way of further infill development in the central city.
The 2GP itself had also been described by one property developer as ‘‘broken’’, despite rezoning 190ha of new land for residential development - providing space for up to 1200 new homes - and identifying a further 132ha of land for future development once needed.
Work on the 2GP began when Dunedin was expected to continue for decades as a low-growth city with a population of fewer than 130,000.
Council staff had since had to revise plans after the city moved into a medium growth phase as its population passed 130,000 in 2018.
A housing capacity report also found Dunedin would be 1000 houses short by 2028 if more land was not made available.
Mr Hawkins said yesterday increasing available land available would not provide a ‘‘magic bullet’’.
The council was already exploring ways to encourage infill development, he said.
It would also need to consider increased investment in new infrastructure for extra greenfield housing.
Council policy planner Emma Christmas said work on variation 2 - a change to the 2GP rules - was looking at potential rezoning of extra greenfield areas, as well as ways to encourage higher-density development in existing residential areas.
The change would be publicly notified in the middle of this year, but would have to go through submissions, a public hearing and, potentially, more appeals, before becoming operative.
Mr Hawkins favoured infill development over urban sprawl.
In the meantime, the ‘‘double-edged sword’’ would continue to get worse for those struggling to buy or rent a home.
‘‘The process of playing catch-up, which is clearly what we’re doing both in Dunedin and around the country, will take some time to resolve.’’