Thursday, 25 February 2016

Up or out? From both sides council says NEITHER!

So Auckland can’t grow out, because Auckland’s ‘planners’ and public-transport advocates says so.

And it can’t grow up, because councillors voted last night that they say so: Auckland Council voting 13-8 to pull new 'denser' maps from the Unitary Plan process.

So what are would-be home-owners to do who are trying to afford their own home in a seriously unaffordable city?

And what are property-owners to do who wish to build and sell to those desperate to get on the property ladder?

The collective answer to both that is coming from across all floors of the mega-council is this: “Fuck you.”

* * *

If last night’s vote to ban building up was a victory for anything, it was a victory for NIMBYism—for Not-In-My-Backyarders who successfully clubbed together to lobby councillors to stop their neighbours intensifying.

Make no mistake, last night’s vote to throw out the intensification proposed by the proposed Auckland Unitary is certainly not a victory for property rights. This proposed plan represents one of the very few times that council’s planners have actually and actively looked to allow property owners to increase the density on their land. Last night’s vote represented the antediluvian reaction to that: from those neighbours fearful of what effect that intensification might have on them.

It is true that everything someone does on their property may have an effect on their neighbour. It is also true that the proposed Unitary Plan does little to reflect the valid fears that neighbours of intensification might have.

But it is not beyond the wit of man to develop gudelines for minimising the effect of three-storey housing on a neighbour (three-storey housing being virtually all the intensifiation proposed). Indeed, it was not beyond the aegis of common law in ages past to recognise that if intensification is to proceeed while respecting property rights, then rights to light, to air, to support and so on must be protected.

I see little reason why those same protections cannnot be formally recognised today.

Instead, we have the worst of both worlds.

We have a city in which folk can’t build either out or up, in which would-be home-owners continue being locked out of their city – and in which the unsustainable bubble continues to bulge tumescently.

It is not a matter of young folk needing to buckle down and do what their older generations once did--buy a small house on the outskirts and save, save, save. It is a fact that house prices have risen well beyond what is actually affordable, and even able to be saved for, precisely because of the very rules those older generations have put in place.

* * * *

median-multiple-rbnz_0

The house-price-to-income multiple is a simplified, yet internationally recognised measure of housing affordability … defined as the ratio between median house price and median annual household income, otherwise known as the median multiple.
    T
he World Bank also says this ratio is "possibly the most important summary measure of housing market performance, indicating not only the degree to which housing is affordable by the population, but also the presence of market distortions."
    Based on this official work, it seems to have become accepted that a median multiple of 3.0 times or less is a very good marker for housing affordability. [Interest.Co.NZ]

Historically, New Zealand’s house prices hovered well below a median price-to-income ratio of 3.0,making houses for most of New Zealand’s history very affordable. This was the era in which previous generations bought their homes.

Capture

Since the mid-nineties however (curiously, at almost the precise time as National’s Resource Management was introduced), that ratio changed radically – and is now all-but out of control.

M-M-2016
Source: Demographia: 12th Annual Demographia International Housing Affordability Survey: 2016

There are many reasons for the rocketing rise in Auckland’s housing unaffordability, from the way new money is loaned into existence in the form of new mortages (in a process invented and maintained by monetary ‘planners’), to the way Auckland land has been kept off the market (in a process over which town ‘planners’ maintain a stranglehold over Auckland property-owners’ land). I don’t intend to relitigate them here (burrow into the archives if you can bear to). I simply wish to talk about choice.

Would-be home-owners have no choice.

They are being priced out of their city.**

And now it is clear home-owners have no choice either. They can’t build either out nor up.

This is not a recipe for a liveable city. It is certainly not a recognition of property rights.

I don’t say that we should be “pro-sprawl.” I don’t say that we should be “pro-intensification. I say, and I’ve been saying it for time, WE SHOULD ALL BE PRO-CHOICE!

The latter group characterise the former as being in favour of “sprawl”; the former characterise the latter as promoting the construction of the slums of tomorrow.

Both are right, and both are wrong.

What’s missing here is choice.  In talking about about development on either “greenfield” or “brownfield” sites, both advocates insist that folk do things their way. They completely ignore the fact that people have the right to choosewhere and how they live, particularly if they own the place on which they choose to settle down.

Let people live where they wish to, as long as they bear the costs. And let those choices themselves—choices based on people’s own values for which they are prepared to pay the cost—organically reflect the way the city develops. …

We let them ring-fence the city and stop people heading out and building away from the city when they want to“sprawl!” is the all-too hysterical cry — and then we let them stop other people building higher density urban housing when they want to. Instead of leaving people free to choose, we have these boring “halfway houses” that some people like, but that many simply accept because that’s all that’s available, and they don’t know any better.

When there’s just so much available, so many great housing types  from which to choose, it just doesn’t make any sense.

“Sprawl” or “intensification”? That’s a false dichotomy. I say let people be free to choose.

That’s the path to genuinely liveable cities, and to affordability.

If only anyone truly gave a shit.


* And let those folk who think National’s Nick Smith is serious about improving housing affordability reflect that as Environment Minister in the mid-nineties the very same Nick Smith administered the Resource Management Act for many years, and did precisely nothing at all to change it.

** Let the NIMBYs reflect at least that many of these folk are their own children and grandchildren, who they may be driving out of the place they grew up.)

RELATED POSTS:

  • “'Smart Growth' fan Tom Beard challenged my encomia to sprawl the other day. As I summarised at the end of last week, my argument was essentially that in lifestyles and the places where we live, we should be Pro-Choice…”
    The sprawling argument continues. – NOT PC, 2007
  • “Last week I put out a post on possible mechanisms to enable groups of neighbours to protect their interests in their own and each others’ properties, while allowing the flexibility for them, rather than councils, to determine what, if any, and when changes in the land use rules affecting that group of properties would be put in place.”
    An interesting approach to urban land use property rights – CROAKING CASSANDRA, 2015
  • “Libertarian blogger Peter Cresswell, author of the Not PC blog, says Auckland sprawl is a myth peddled by planners and politicians.
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        “’What Aucklanders need is not to be told by planners where and how they live—either in high densities or in quarter-acre sprawl or in small hamlets or country houses miles from the city centre.
        “’What they need in their housing is choice – the ability to choose where and how they live based on their own values, their own desires, and the often limited ability of their bank accounts. What they don’t need is to be told by planners, who are just out of school, that their choices are illegal.’”
    Google busts Len Brown’s Auckland ‘sprawl’ claims – NBR [via Whale Oil], 2013
  • “Those against increasing the urban limit are not just saying they don’t want to live further out – but they want to effectively ban others from doing the same.  They don’t want people to have choice – they want everyone in an inner city apartment.”
    Housing affordability – KIWIBLOG, 2012
  • “Ironically, it’s the very promoters of intensification, the planners themselves, who have done the most to make decent intensification more difficult.  Here's just some examples of a few urban housing types that are enormously popular overseas, but could barely be even contemplated here…...”
    “Sprawl” versus “intensification” – NOT PC, 2012
  • “There will be no innovations in NZ’s high-cost labour-intensive building techniques until innovative systems such as this can be painlessly introduced and exploited—perhaps only when councils themselves are taken out of the chain of responsibility for policing building standards…”
    Government finally plans to address unaffordable housing. But… – NOT PC, 2012

11 comments:

  1. What was even more disappointing (although for me at least, not entirely surprising) was seeing Hugh Pavletich this afternoon applaud this Council decision. This puts him squarely in the "pro-sprawl" camp, and an enemy of pro-choice.

    ReplyDelete
    Replies
    1. Indeed.

      Sprawl v intensification: looks like yet another false dichotomy, doesn't it.

      Delete
  2. No mention of the 20000-30000 empty houses in Auckland due to capital gains speculation, or our property market being used to launder millions of dollars by foreign crime syndicates?

    ReplyDelete
    Replies
    1. Nor any mention of the moon landings, or how jet fuel doesn't melt steel ...

      Delete
    2. Got it. Any issue that requires regulation is written off as a conspiracy theory. It's a good strategy to stay ignorant about anything that would make you question your worldview.

      http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11510931

      Delete
    3. No, Dave, not really. It's because: even if Neil Armstrong, George Bush and the unresurrected ghost of Osama Bin Laden himself were all laundering money through NZ's housing market, that wouldn't make a blind bit of difference to whether and where people should be allowed to build.

      Delete
    4. More houses being built will just be mopped up by speculators, making the eventual crash much worse.

      You think anyone and everyone should be allowed to exacerbate the Auckland housing bubble, at the expense of young families who need somewhere to live. And you wonder why no one voted for the Libz at election time.

      Delete
    5. Sure, even if it is 40,000, that's a drop in the bucket compared to the population of Auckland which is ~1,400,000. I'm pretty sure most of those "speculators" would rather rent the places out in the mean time anyway. If you really want to screw them over why not drive the prices down by increasing supply (letting people build!)

      Delete
    6. The higher prices go, the lower the rental yield and the less worthwhile it is to put up with the hassle of tenants.

      Increasing supply would only bring prices down if the buyers/speculators were residents. But since our property market is open to anyone in the world with access to cheap credit, there is no way new supply could possibly be enough.

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    7. So the problem as Dave sees it is that we have an army of foreigners waiting to buy up every house that gets built and then proceed to leave it vacant and not rent it out - apparently because that's the way they make money at our (residents) expense. We apparently could never build enough to satisfy this insatiable demand to buy houses and then do nothing with them....The moon landing conspirators have got nothing on this guy when it comes to being out of touch with reality!

      Delete
    8. Where is the data on foreign home ownership? National refuses to collect this data because it's easier to ignore problems than confront them. Especially if you're a politician who likely won't be around when the shit hits the fan.

      NZ is one of the most popular countries on Chinese property websites. Given the number of speculators this represents & the size of Auckland, how can this not be an issue? You're the one wearing the tin hat.

      Delete

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