Windfall profits for some at the expense of affordable housing for others

Here is how the housing market works under John Key’s crony capitalism: he and his housing minister and the council’s planners have between them just made around half-a-dozen land-owners around Auckland rich beyond their wildest dreams.*

In announcing the “Housing Accord” with the Greater Auckland Council, planners and politicians failed to understand the power of Mr Market.

Announcing out of the blue some land allowed to slip through the council’s zoning net, the land-owners quickly discovered their land formerly zoned rural by planners now had the politicians’ and planners’ tick to build houses – and the value of said land immediately went through the roof.

Some have put land up for sale soon after gaining designation as a Special Housing Area, achieving prices up three times higher than previous valuations.
    In one case, adjoining rural properties valued three years ago at $4.5 million sold for nearly $11 million, after being approved for fast-track housing development.
    A property developer has sold large blocks in the Huapai Triangle, valued three years ago at $8.65 million, for more than $20 million.

By locking up land and releasing it only in dribbles – favouring some land-owners over others, particularly those with pull – planners generate not only the carpet sprawl they claim to despise, but windfall profits for some at the expense of affordable and reasonably priced land for others.

The solution is to shoot the planners – or at least to make them unemployed – and let people exercise their own choice over where and how they live.

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* National cronies? No, I don’t know either  (a good job for a good journalist that, discovering the details), but if they weren’t before, you’d think they’d certainly be supporters now. Because that’s how public-private partnerships roll, baby.