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The Unitary Plan will not solve the Housing Crisis

Written By: - Date published: 11:30 am, August 1st, 2016 - 9 comments
Categories: Andrew Little, auckland supercity, bill english, housing, labour, local government, national, Politics, same old national - Tags:

The Government has put a lot of weight on the Unitary Plan dealing with the housing crisis that clearly Auckland is in the middle of.

Last week Minister of Housing Nick Smith said this:

It’s not for me to be trying to influence the Council as it now works its way through those recommendations and comes to a decision. So today I’m not going to be expressing a view on the plan and trying to influence the Council’s decision.

“I just want to emphasise the importance of the Council concluding the process,” Smith told those gathered at a media briefing.

“It is certainly the Government’s view that a failure to provide adequate supply and plans, is at the core of the housing supply and affordability issues that Auckland has.”

His comments are similar to those made by Bill English a month ago.

“We’ve known about housing stress in Auckland for a number of years,” English said. “It’s why the Government has made some very direct statements about the obligations of the city council to change the planning rules, to enable more supply so we can get more houses. The only people who can agree to get the house built are Auckland City Council.”

He said the rate at which completed houses are entering the market – which he put at 40 a day – is not enough.

“We have got to work hard with the Auckland City Council to get more houses because the Government can’t just magic up houses. They have to be built by real people on real land, and that’s controlled by the Auckland City Council.”

So after last week’s release of the Independent Hearing Panel’s the question has to be asked what will the Unitary Plan do about the housing crisis?

The answer appears to be very little unless the definition of an affordable home is one that is worth $800,000 or more.  Because as noted by Labour the modelling used by the Independent Hearing Panel predicts that only 15 per cent of new homes under Auckland’s Unitary Plan will cost less than that amount.

“The majority of these houses will be out of the reach of most Auckland families. The modelling found that, of the 247,000 new homes planned within the existing urban area, 85 per cent will cost more than $800,000 and most will cost more than a million dollars.

“Less than 2 per cent will cost less than $600,000 and just one house is expected to be sold for under $500,000.

“If this is National’s brave new world then they are even more out of touch than anyone suspected.

“The mortgage on a $600,000 home costs nearly half of the median Auckland income, meaning 98 per cent of these 247,000 houses will be unaffordable to the typical family.

“Lacking any credible plan of its own, National is relying on the Auckland Council’s Unitary Plan to tackle the Auckland housing crisis. But these numbers show that under the Plan very few affordable homes will be built.

The other problem is that the plan will not have an instantaneous effect.  Houses will not magically spring up out of nowhere offering shelter to those in need.  It will take years to get resource consent, let tenders and build homes that are badly needed,

The Government also announced changes to the Homestart scheme.  Income caps have been increased from $80,000 to $85,000 for a single person and from $120,000 to $130,000 for a couple.  The maximum price of a qualifying house has been increased from $550,000 to $600,000.  As a sign of how out of touch the scheme is a secondary school teacher’s aspirations of owning a home are not improved.  He or she already qualifies income wise but increasing the potential price of the house he can buy is of no assistance at all as his income will not sustain the mortgage that would be required.

The size of the problem is such that concerted action needs to be taken now.  The state building houses has worked before.  And selling Housing Corp houses in the middle of a crisis is clearly not the sort of thing to do if you want to deal with the problem.

There needs to be concerted action by the Government. Leaving it to the market and blaming Auckland Council will not suffice.

Reprinted from gregpresland.com

9 comments on “The Unitary Plan will not solve the Housing Crisis ”

  1. adam 1

    Thanks MickeySavage for posting this.

    I call this illusionary politics, because I actually think Nick Smith thinks this will work. Council think this will work and all the people advising council think this will work. Funny how shallow they all are.

    Here is a radially different approach

    We need to socialise empty houses, and we need empty industrial spaces to be taken over for housing.

    Massive tax cuts and relief for Marae and churches who open their doors to house people.

    The people who the crisis actually affects, being included in the discussions towards solutions. And take a leading role in the solution.

    If that means communal type living arrangements, and extended family arrangements – then this needs to be part of the solution as well.

    Because this top down approach has proven one thing – the elitist, governors, bosses or what ever else you want to call them, are not capable of handling this issue.

  2. Sabine 2

    The unitary plan is not meant to alleviate the housing crisis.

    the unitary plan is meant to allow some to build where previously could not build and then sell on to the highest bidder for the highest prices.

    everything else is hogwash.

  3. save nz 3

    The Unitary Plan will not solve the Housing Crisis – Yep. +1000

    Personally think it will increase it.

    As they knock down all the cheaper historic 3 bedroom plus 1 bathroom bungalows and Villas and start to put through million dollar mansions with questionable cladding and million dollar apartments with eye watering Body Corp fees, then there will be less and less affordable choices for both renters and buyers… Then as usual in NZ, everything will be built at once, 10 years too late and not fit for purpose.

  4. ianmac 4

    Steven Joyful called for the removal of the “Affordable House” section in the Unitary Plan. And Presto – its gone.

  5. esoteric pineapples 5

    As an economy open to all the world, the Auckland housing crisis is really just a reflection of New Zealand being a part of a global economic system where extremes in wealth inequality are the norm. Extreme differences in house prices and living conditions in China are really part of the same market as extreme conditions in New Zealand. We may in fact be looking at a new normal where although there may be some correction of the housing market at some time, generally speaking the extremes will continue for the foreseeable future.

  6. jcuknz 6

    Awhile back I read an article by a Chinese living in Singapore and one of the photographs showed a chinese family living in one room in an apartment block. A long way from the quarter acre paradise that NZ once was but possibly the future for Kiwis.
    Heaven forbid but perhaps somewhere in between should be the target.
    I am such a long way from when I built my last house [25ys] that I simply do not know how $800k is the basic price for a new house in Auckland. obviously to me there are some ‘un-natural’ costs feather bedding the councils involved.

    I like the Green’s target of a 50% reduction over time but houses take so long to build [ except when factory prefabricated ] so I expect most to be dead before it happens and inflation will have made current figures meaningless.

  7. fisiani 7

    The Unitary Plan has been described as a panacea for the housing crisis by the Government. But will it actually address this most acute of issues?

    Where do the government call the Unitary Plan a panacea or is this just another misleading click bait heading in the home page.

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