that New Zealand is the second least affordable place to buy a house, after
only Hong Kong, is sadly unsurprising, and signals that a new approach is
needed to get more homes built and make housing affordable,” says
Infrastructure New Zealand CEO Paul Blair.
Demographia released its most recent annual report into housing affordability
in Australia, Canada, Hong Kong, Ireland, New Zealand, Singapore, the UK, and
eight New Zealand cities were assessed as severely unaffordable, as each had
median house prices over five times their median income. Affordability is
assessed by a ratio of three or lower.
this news is no surprise. It confirms that the problem is New Zealand-wide, and
not limited to large or fast-growing cities like Auckland,” says Blair.
Dunedin to Auckland, the challenge of building enough homes is an enormous
problem, and it’s primarily because councils are unable to pay for the
infrastructure needed to bring down land prices.
councils in New Zealand build and maintain almost 40% of this country’s
infrastructure, primarily local roads, pipes, and sewers, which is about the
same amount as the central government looks after.
local councils only have one tenth the amount of money to spend on it compared
to central government.
our towns and cities grow, central government enjoys the benefit of this
economic growth, while councils are legally restricted to only recovering their
debt constraints add to this problem and mean that councils are unable to
invest in public transit, roads, and pipes where 85% of New Zealanders live.
New Zealand’s Building
Regions report proposes a series of partnership agreements
between central government and local councils, grouped around regional spatial
government doesn’t have direct land use powers under the current resource
management system, so local government’s ‘bottom-up’ ability to influence land
use must be enabled.
return for central government providing local councils with a new, long-term
share of national taxes, local councils can free up infrastructure-serviced
land for housing in a way that meets central and local objectives for better
housing affordability and choice.
local councils with a share of the dividends from economic growth so they can
invest in infrastructure to create more economic growth and free up land for
housing just makes sense.
all, it is central government who pays the bill when unaffordable housing puts
people on the street, forces people live in damp homes, or eats away at the
savings that people should have.
unaffordable homes are making us poorer, less equal, and less efficient. The
longer this housing crisis continues, the greater the costs to New Zealand and
New Zealanders,” says Blair.
For further information and
comment contact Paul Blair on 021 902 436