Labour and National’s unlikely collaboration on housing intensification is set to slow the growing inequality between homeowners and renters – but councils may still need some convincing of the policy’s benefits, Sam Sachdeva writes
Analysis: Megan Woods and Judith Collins may not have led a conga line into the Beehive theatrette, but the spirit of Super Saturday’s ‘vaxathon’ was alive and well at Tuesday’s surprise bipartisan housing announcement.
Just as the Covid-19 vaccine rollout is an issue which transcends party lines, so too have Labour and National joined forces in a bid to address the crisis which both have arguably played a significant role in creating.
The Housing Minister and the National leader presented a united front against nimbyism, accompanied by Environment Minister David Parker and National housing spokeswoman Nicola Willis as they announced legislation to streamline housing intensification and speed up councils’ implementation of new urban development rules.
When passed, the law will allow three homes of up to three storeys to be built without a resource consent on most sites in “Tier 1” cities Auckland, Hamilton, Tauranga, Wellington and Christchurch – a significant step up from the status quo, with most district plans allowing just one home of up to two storeys.
Those changes will take effect from August 2022, while the full implementation of the national policy statement on urban development – a set of rules to remove minimum parking requirements, increase intensification through fewer restrictions on height and density, and improve poor-quality planning by councils – is also being fast-tracked to August 2023 (at least a year earlier than current timeframes).
Planning rules have long been a bugbear for New Zealanders interested in urban development, alongside a tendency towards residential sprawl rather than increased density.
A cost-benefit analysis prepared by PwC and Sense Partners concluded the density changes would add between 48,000 and 105,000 new houses over five to eight years, with the costs of added congestion and loss of some amenity more than offset by the benefits of more affordable housing and improved access to goods and services.
‘Slowing wealth transfer from renters to owners’
But pure economic benefit is only part of a wider picture of growing inequality, as the analysis noted.
“Rising house prices become a crisis not because they create net economic losses to society, but because they accelerate transfers of wealth from those whose labour is their primary asset to those who own land and capital.
“If the [density change] succeeds in slowing the rise of house prices, its pure benefits outweigh its costs as shown above, but it also slows down this transfer of wealth from renters and first-time buyers to existing property owners.”
While the Government could have passed these changes by itself, there is benefit in having bipartisan backing on what has often proved a contentious issue.
As Woods put it, “having broad political consensus on these changes, gives homeowners, councils, investors and developers greater certainty”.
At a more base level, having National’s public backing also helps to inoculate Labour against any electoral blowback further down the line, should the policy’s impact prove unpopular or ineffective.
But there is also a clear benefit to National in showing the party can be constructive and play a role in developing policy rather than merely shooting down the Government’s ideas.
“To those that worry reduced regulation may mean a neighbour subdivides or the community loses its character, I say this – our communities lose their character when people can’t afford to own their own home.”
Indeed, Collins was arguably as compelling as at any point in recent months when she spoke about the real-world impacts of the housing crisis and addressed fears about the effect on suburban communities.
“We see young families locked into renting, kids growing up without any particular roots in the community, we see young families forced to save for a decade to build a deposit and putting off decisions because of that lack of certainty…
“To those that worry reduced regulation may mean a neighbour subdivides or the community loses its character, I say this – our communities lose their character when people can’t afford to own their own home.”
Fittingly given the unlikely coalition, a diverse range of organisations have praised the announcement, from youth-led climate action group Generation Zero to free-market thinktank the NZ Initiative and property developers Du Val Group.
But arguably the most important ‘stakeholder’, the councils who have to implement the policy changes, seem lukewarm.
Auckland Mayor Phil Goff said infrastructure funding, not zoning rules, were the biggest impediment to housing development, while a push for more intensification needed to be balanced with the desire “to retain the best of Auckland’s character and heritage”.
Infrastructure funding an enduring concern
The concern from some within the local government sector appears to be that reforms are yet again being done to, rather than with, it, while the significant cost of upgrading infrastructure for brownfields development is not being met with sufficient help from central government – either through direct funding or more innovative financing mechanisms.
Woods said the Government had attempted to lighten the planning load by requiring councils to focus just on accessibility and not demand in assessing requirements for some areas, while she acknowledged that its Housing Acceleration Fund for infrastructure was just the start.
“We fully understood that $3.8 billion was not going to fully solve the problems for New Zealand – but what we certainly want to be able to do is to work through that in a robust and rigorous way.”
Christchurch deputy mayor Andrew Turner, who has worked with Local Government New Zealand’s metro sector on the national policy statement, said the announcement was “actually an improvement in some ways” by creating clearer definitions for councils, but there was a risk of heightened density in parts of Christchurch which did not make sense.
“It is going to bring about a level of height…and intensification that we haven’t seen in some places before, that will change the face of some parts of the city.”
He also had concerns about the potential loss of tree canopies which were integral to the Garden City’s reputation, and said the council would need to respond through pocket parks and other initiatives in public spaces.
But as Turner noted, “it’s fair to say with cross-party support this is going to be happening”, and councils’ focus will now turn to mitigating any unintended consequences through the select committee process rather than torpedoing it outright.
The bill is set to be passed into law before Parliament rises for the year, and the cross-party accord seems more like a Christmas truce than a permanent peace treaty.
But even if (or when) National does go back on the attack, and Labour counter-punches, this will still stand as a rare and welcome example of politicians reaching across the aisle.
