13 May 2013

Housing plan ‘a weak compromise’

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Written by: Brian Rudman
Photo by: Paul Estcourt
Published: The New Zealand Herald – 13 May 2013

Issues in the Government's hands include the cost of building materials, shortage of skilled labour and the like.

Issues in the Government’s hands include the cost of building materials, shortage of skilled labour and the like.

Housing Minister Nick Smith’s boast that his new housing accord with the Auckland Council “is good news for Auckland families wanting access to more affordable houses to buy and rent,” is at best, wishful thinking.

If he really believes what he says, Dr Smith is up there with British Prime Minister Neville Chamberlain, who flew back from a meeting with Hitler in 1938 waving a pact declaring he’d achieved “peace for our time”.

A year later, the German dictator dismissed that “scrap of paper” and World War II broke out.

As far as affordable housing is concerned, the accord which Dr Smith claims will “urgently increase the supply and affordability of housing in Auckland”, is similarly just a scrap of paper.

Council sources reveal Mayor Len Brown and his deputy Penny Hulse pushed hard for quotas for affordable housing to be included in the accord, but the Government refused.

The result is a weak compromise, with the politicians playing up affordability, but the document failing to back up the words.

Like Dr Smith, Mr Brown highlighted the “important role” the accord will have “in tackling issues of housing affordability and supply in Auckland”.

He said: “We expect developers to provide decent options for affordable housing and for first-time buyers”.

“Expect” is the key word. Instead of no-nonsense “require”, it’s that pleadingly, headmasterly “expect”.

The accord itself starts back-tracking early on.

“The parties … acknowledge that improving the affordability of housing is a complex issue and requires consideration of wider issues, not all of which will be able to be addressed under this accord,” it says.

Issues in the Government’s hands include the cost of building materials, shortage of skilled labour and the like.

The accord is the end result of six weeks of discussions after the recently appointed housing minister’s headline-grabbing threats to use legislation to open up greenfields sites for new housing development if the Auckland Council didn’t jump to his demands.

The Government’s simplistic view is that opening up more rural land and leaving it to the market will solve the shortage of housing.

Borrowing from examples such as Vancouver, the Auckland Council’s bottom line was that provision must be made for affordable housing if it were to go along with the Govern-ment’s fast-tracking proposals.

What we have is a weak compromise.

“All qualifying developments are … required to give consideration to the provision of affordable housing and/or first home-buyer purchase. Conditions of consent may include requirements for a proportion of the development to include affordable housing and/or provision for first-home buyer purchase.”

Phrases like “give consideration to” and “may include” give developers a motorway-sized escape hatch.

The agreed targets for new houses are 9000 for year one, 13,000 in year two and 17,000 in year three. Both parties have agreed “in good faith to achieve the agreed targets”.

So what happens if developers drag their feet and refuse to start building houses unless the council drops whatever affordable housing requirements it puts up?

With a government insisting on action, which will win out: 39,000 new houses in three years no matter how expensive, or 39,000 that includes say, 20 per cent, of “affordable” stock?

There’s no talk of the Government taking a lead in helping solve Auckland’s affordable housing crisis. Prime Minister John Key joined Dr Smith and Mayor Brown for the launch of the accord at Housing New Zealand’s imaginative public-private partnership at Hobsonville Pt.

It was the perfect chance to point to the success of the surrounding Government-led housing development and declared an intention to speed that up, and then duplicate the process elsewhere – consolidate land titles on the fringes or in brownfields sites within the urban limits, design new communities, then bring in private contractors to build and sell.

Perhaps Housing New Zealand could be included in the mix, to provide social housing. But from news reports at the weekend, Dr Smith’s aim is to reduce the state’s involvement in social housing, not increase it.

The accord underlines this, insisting the 39,000 new homes “will need to be achieved mainly by private housing developers”.

While announcing plans for fast-track “special housing areas” it rules out either the Government or Council compulsorily buying up land to create such building sites. It insists that “investment in land development and housing cannot be compelled”.

I’m with Hitler on this one. It’s just “a scrap of paper”.


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