Some of you may have noticed the announcement last week that the Government has committed to working with the Auckland Mayoral Housing Taskforce.
The primary output of the task force to date, beyond PR to the voters, is to show their support for reducing the housing shortage and improve affordability. This was detailed in a report released in June last year.
The report suggests to make changes, in three key areas, one of these areas is “delivering efficient and certain planning, consenting and risk management”.
The report admits that complex or uncertain consenting processes delay or derail home building.
The report repeats the claim from Council that 93% of consents are processed within statutory timeframes, but this doesn't consider true when the “clock is stopped” to request further information and in some cases reflects the resourcing challenges in parts of Council and delays in reaching a decision. This gem is buried on page 37 of the 50 page report.
This admission was forced out of Council by an Auditor-General report carried out in 2015, which indicated that the time frame for 80% of the consent applications take double the statutory time, averaging eight weeks, with many of the remainder taking more than 20 weeks!
Our conversations with the planners, developers and consultants suggest that things have got worse not better under the new Unitary Plan.
The Unitary plan has increased the requirement to lodge for resource consent to develop land for new housing. Two dwellings that break a development standard, or three or more dwellings in MHS (Mixed Housing Suburban), MHU (Mixed Housing Urban) and THAB (Terraced Housing and Apartment Buildings) requires a restricted discretionary resource consent!
As most developers will tell you, a two site subdivision or development is uneconomic and complying with all the standards is next to impossible.
Development contributions and consent costs take on average of 5 to 10% of new home sale value, add GST at 15% into the base cost and the result is Local and Central Government capitalising 20 to 25% of new home value with a low productivity component and increasing debt by home buyers to cover this aspect.
Quite simply this pushes new home building away from the affordable and decreases housing development viability.
The solution to this could be as simple as changing the plan rules back to what the Unitary Plan Panel recommended, which was five or more dwellings as restricted discretionary, in MHS and MHU zones, i.e. up to four permitted, and for the Government to recognise the social good arising from new building and transfer GST on houses to Council to eliminate development contributions on new housing.
These two simple steps could un-lock vastly quicker and more affordable housing development.
Auckland’s Untold Growth Story: The Elephant in the Room
Auckland leads the country in population growth and this trend is predicted to
continue, according to property, architecture and research company RCG.
In the March 2018 issue of Constructive Thinking, RCG Associate Director John
Polkinghorne explores Auckland’s growth between 1891 and 2013, and compares it
to growth across the rest of New Zealand.