The housing crisis: how we made it and how we fix it
An important report from Te Waihanga|The Infrastructure Commission shows that our current housing crisis wasn’t inevitable. Hear more from Te Waihanga’s own experts at the next Urbanerds this Tuesday!
The New Zealand Infrastructure Commission, Te Waihanga released a report in March called “The Decline of Housing Supply in New Zealand: Why it happened and how to reverse it”. It examines the housing market from the 1930s to the 2010s to figure out how we got here and what we can do about it, busting some significant and popular myths along the way.
The report’s lead authors will be joining us at this month’s Urbanerds – scroll down for more!
What does the report tell us? One of its key findings is that when demand rises these days, we are currently building about a third fewer homes than we used to when demand rose. This is largely due to changing regulations and systems that don’t support new housing as much as they did in the past.
Prior to the 70s, planning systems better facilitated the development of new properties and suburbs. Councils even actively encouraged the development of suburbs outside central cities. At this time, there were also significant improvements to public transport.
But this all changed as central areas were “downzoned,” limiting development to preserve the existing inner suburbs. Transport changed too as more and more people bought and relied on cars. So what happened without development in central areas, with suburbs not expanding at the rates they used to, plus a shift in focus towards cars? Commutes have become harder, congestion has worsened and prices for limited housing have only continued to soar.
This didn’t just happen overnight. It came with a string of planning and financing legislation that restricted what houses could be built and gave “NIMBYs” (Not In My Back Yard) more political power. And it’s continued, despite poor housing supercharging many of New Zealand’s social and economic issues.
“Accelerating house prices were not inevitable… Going forward, we can boost housing supply and improve affordability by reforming our approach to urban infrastructure and urban planning.”
TE WAIHANGA
There is work in progress that may bring us out of this situation. The government has announced plans such as consolidating policy and district plans to simplify national planning. And tier 1 councils such as Wellington will be required to include intensification in their plans by August 2022. This should make it easier to build three homes up to three stories tall on most sites without resource consent.
The building and accessibility of affordable housing will be crucial to getting us out of this crisis. But it won’t be the only thing.
Some have called for rent controls and freezes in the meantime. But using these blunt, bandaid solutions doesn’t truly fix the underlying poor regulation.
And a lot of the problem lies with transport; people-friendly streets and reliable, accessible and versatile public transport make more far-flung places much more liveable.
Have a read of the report itself and check out some other people’s takes in the further resources below.
Come hear about it live this Tuesday 10 May!
The lead authors of the report, Te Waihanga experts Dr Nadine Dodge (Senior Economist) and Peter Nunns (Economics Director) are our special guests at this month’s gathering of Wellington Urbanerds.
Join us Tuesday 10th May (always the 2nd Tuesday of each month), from 5 p.m. at Waitoa, Victoria St.
Our guests will be giving a brief talk at 5:30 p.m. about the report’s findings before answering your questions!
They’ll prioritise questions received early, so click here to RSVP get yours in.
Make sure you RSVP even if you don’t have a question because Waitoa needs to know our numbers in advance.
See you there!
Further resources
- The decline of housing supply in New Zealand: Why it happened and how to reverse it from the New Zealand Infrastructure Commission, Te Waihanga
- Reimagining Wellington: Should we have a moratorium on greenfield developments? by Ethan Te Ora and Kate Green
- Infrastructure Commission: Politicians and Nimbys created the housing crisis, by Dileepa Fonseka
- Inside our housing supply catastrophe by Bernard Hickey
The report is a fascinating read and I was reminded of another counterfactual of how things might have been very different if Auckland’s commuter rail network had been built in the 1950s as planned – with another lost opportunity in the 1970s (sigh).
I did wonder, however, that even if the downsizing of inner Auckland hadn’t occurred in the 1970s whether we would have got the growth in medium or high density housing that would have alleviated our present crisis. Low-density urbanism had been a strong Pākehā cultural trait since the 1840s – setting the New World apart from the Old. Our colonial cities had few terrace houses and apartment buildings were unknown. When the first apartment buildings appeared in the 1910s they were considered bohemian and freakish. When the government built high-rise state flats in the 1940s and 50s they were condemned as ‘un-New Zealand’. No more were ever built. Even medium density Star Flats were seen by their tenants as inferior to standalone state houses. This cultural norm meant that when such buildings were permitted under planning rules only a few were built. The downsizing ordinances only recognised what was common practice.
It’s only in relatively recent times that attitudes have changed. I remember in 1999 looking with my partner to buy an inner city Wellington apartment for our young family to live in. Invariably, real estate agents told us families belonged in the suburbs and we should look there. That apartments are now being built with families in mind shows a huge cultural shift and one that opens up exciting new opportunities for urban living.