You may have noticed that there is a general election coming up, and the amount of hot air increasing from all sides. Billed as the battle of the Chrises (Chris’s? Chrisis? Crisis?), I’d venture that it is a lot more serious than just a two-way stand-off of Chris H vs Chris L – its actually a Mexican stand-off with Chris B in it as well, and he is the biggest potential loose cannon in the National camp. Potentially he could be the next Minister of Quite a Lot, possibly even the Minister of Housing, Minister for Infrastructure, and the Minister of Urban Development. None of those prospects fill me with great joy. This election is going to be all about Housing to me, and there’s the rub. We have some. We need more, much more.
It’s now universally acknowledged that we have a Housing crisis, but we are not alone in the world for having one of those – most countries do. All over the world, in developed nations, the housing market is a wee bit stuffed up at present. Australia has a housing crisis – read this – dubbed as “…the worst housing crisis in living memory.” England has a housing crisis – read this – and they note that “The most important thing to stress is that political choices created the housing crisis.” Ireland has a different sort of housing crisis as noted here. France has a housing crisis too – read here. Clearly the problem is not one that has been created solely by Labour or by National, but by the one thing that all the world has in common : money. There is either a shortage of it (in your pocket), or there is too much of it (sloshing around in bank’s deep pockets). To quote Bill Clinton, some 30 or 40 years after it was cool to: “It’s the economy, Stupid.”
So, changing the Government is hardly likely to change the Housing Crisis – unless, of course, someone does something to make it worse. And with Chris Bishop in control of Housing, that may well happen. With ACT also in the PowerPlay, it is almost guaranteed to get worse. And yet a National / ACT coalition is almost guaranteed at getting in, as it stands right now, seeing as Labour have effectively squandered their lead and massive majority, by succeeding in accomplishing virtually nothing. No Light Rail in Auckland. No light Rail in Wellington. No new hospitals anywhere, despite alleged poo running down the walls at Middlemore at the start of Labour’s reign. No new tunnels under Mt Victoria and no new Regional Railways except for Te Huia in Hamilton. Under this Labour Government, the Housing Crisis has got worse – way more worse. No one really knows why, but it has. While National were OK to let people sleep in their cars, Labour have brought them inside, to sleep in Motels, only now that has got well out of control. There are now over 3400 families in Emergency care housing, although this is down from a peak of 4900 back in January 2021 during Covid times. But there is also over 24,000 on the waiting list, which was only about 8,000 at the start of 2018 (ref Stats from MSD), and National claims the waiting list was only about 5,000 when it was last in office.
I’m going to quiz you all with a series of quotes, to see if you can pick out which of the following statements refer to Aotearoa, and which to other countries, right?
A) “The housing crisis is anything but a surprise. It has been predicted by industry professionals for months and now seems unavoidable.”
B) “Rising interest rates are restricting the availability of mortgages and reducing the number of potential buyers. Weak demand is beginning to weigh on prices and the fluidity of transactions.”
C) “The new-build market is in freefall, with a consequent impact on the construction industry.”
D) “This domino effect is occurring at a time when there is already a significant housing shortage. The whole chain now threatens to seize up, with households unable to access home ownership, tenants faced with a flagrant lack of supply and a social sector no longer able to fulfill its mission.”
E) “While there’s nothing surprising about the situation, what’s striking is the lack of anticipation. Who seriously believed that the period of virtually free money could go on indefinitely? The return to reality is all the more brutal given the illusion of an only gradual rise in interest rates. Inflation, in the wake of the pandemic, decided otherwise.”
F) “We need to reduce inflation, which is eroding purchasing power − but without penalizing credit, which facilitates home ownership.”
G) “We urgently need to increase the supply of housing at a time when the environmental transition is putting strict controls on construction and forcing poorly-insulated properties to be withdrawn from the rental market.”
Hard to tell, isn’t it? Have a try – see what you think.
So – Is there anything we can point to as a positive, right now? Well, despite the numbers in Emergency Housing shooting right up, there is significant increase in the number of Kainga Ora houses being built, although everyone seems to argue over the actual numbers. KO’s published data from 2023 says there is 67,099 managed state rentals, although it also notes that 4,151 are vacant. Wikipedia notes that KO has built about 7,000 since it’s inception. Does this mean that it started off with 60,000 houses already? National are, this weekend, on record as saying that they, if elected, would build 30,000 more (need a source – I think it was on the radio – is it written down anywhere?), which is a pretty bold promise seeing as they have forever been taking the piss out of Labour for promising 10,000 a year Kiwibuild for ten years, and in the last Key/English government, Blinglish was busy selling off all the housing he could. On the face of it then, it would seem that KO has been successful – and has now secured a supply of land for the next 5-10 years, but Nat’s Chris Bish has already declared that KO’s future land-buying plans will be closed down if / when he gets in and goes all Voldemort on their ass. Does that mean that, in true blue fashion, he will be selling off state housing once more?
Who knows?
Can you please indicate links in text by a high-contrast colour, so they’re easier to read? Thanks
Hi Henry – the links are in yellow, which shows up well on my computer against the grey text. Is it not doing that for you?
I find the best datasets on “public” housing . i.e both KO and CHPs is from the Ministry if Housing and Urban Development (HUD)
https://www.hud.govt.nz/stats-and-insights/the-government-housing-dashboard/public-homes/#tabset
KO has been slow off the mark, and most of its work is actually replacing the run down stock they currently have, ( and slightly expanding capacity in the process)
Thanks Greenwelly – I’ll go have a look at those now
You’re right – much clearer data. Thanks
My understanding is a lot of KO’s current work is about increasing density as they refresh their stock – so major pieces of work like East Porirua, Northcote, Tamaki, Mt Roskill. Maybe 6 or 8 standalone homes on a quarter acre being replaced by dozens of apartments.
National MPs are forever protesting state houses in their electorates though
Could you put some sort of a warning up before you publish pictures of Bishop with a mullet please?
I mean, that chin, I’m traumatised
Nah. Few people better suit a mullet than Chris.
I thought that you too would have a chin like that, 60, as it is suitable for breaking rocks and could well be mounted on the front of a digger in a road crew. Does he really suit a mullet though Henry? Does anyone ever really look better like that? Except maybe Sharon O’Neill ?
I don’t hear either of the two main parties talk about raising productivity much
We could get this country moving with more integrated training for school leavers, more funding for agresearch, work for dole schemes cleaning up the East Coast and Nelson/Auckland flooding
Now is not the time to slow down KO housing, we should pick it up and use it to train apprentices like the railway workshops used to
Land is expensive and materials are overpriced – more single bulk imported product will drop prices as well as allowing standardised acceptable modules
When a shipload of roc wool insulation hit the country it dropped the pice for Batts
Elephant board is usually cheaper than Gib which is a complete have anyway, plasterboard couldn’t brace a damn thing
If we had standardised UPVC windows made in bulk then the cost of windows would drop by a huge margin
Instead of 3 waters central govt could quietly send out a team of engineers and accountants to all of the local councils, talk to them about what work their region really needs, offer them a yes/no option of funding the most prudent of options and loan them the credit to buy them and lock them into a contract where the assets become theirs when paid off
Add the cost of people’s time into the insane amount of roadworks delays and charge that directly to the costs of LTSA projects
That lot will see things turning over a bit quicker
Charging farmers for emissions when the product will just be made offshore in a less efficient and more subsidised nation is stupid
I know you lot are terribly liberal but honestly the thought of the Greens anywhere near the Treasury benches is a disaster in my books
I will be voting ACT, not for their housing policy which I disagree with but I see more and more of the tax that I pay going into this bloated beauracracy and I see less and less being done for the money, as well as a bigger list of things they don’t want me to do
Have you guys seen just how crap our govt is at making smart decisions?
Oh 60, why aren’t you running for government? You make a WHOLE lot of sense – I would certainly vote for you. I agree with everything you say in your list above.
So – how do we get sensible people into Government, when there are clearly so many plonkers in the way? Certainly I agree that a return of something like the MoW would be hugely helpful to all in NZ. They were unexciting plodders at times, but heck, they certainly got things done, and in a logical order, rather than the mess things are now.
First up today, there is this:
https://www.thepost.co.nz/a/nz-news/350070349/wellington-house-prices-low-enough-some-first-home-buyers
Wellington house prices low enough for some first-home buyers – Piers Fuller – September 12, 2023
“Wellington’s southern suburbs are leading the residential property market turnaround, with first-home buyers starting to show interest ahead of investors returning to the market. Quotable Value issued its latest figures on Tuesday showing Wellington’s rolling three-monthly rate of home value reduction has eased for the fifth straight month, but the region had posted a small 0.4% average home value increase last month. Leading the rebound were suburbs in the southern part of the city such as Newtown, Island Bay and Mornington with a 1.8% increase in quarterly growth in that area, according to QV. Its House Price Index showed the region’s average home value had reduced by 0.6% to $827,000 this quarter, an improvement on the 1.7% average decline for the June quarter.”
And then there is this whine-fest:
https://www.thepost.co.nz/a/business/350069873/mega-landlord-who-predicted-downturn-will-sell-and-leave-nz-if-labour-wins
Mega landlord who predicted downturn will ‘sell-up and leave NZ’ if Labour wins – Ged Cann – September 10, 2023
To which I say – good ! If some wealthy creep who owns way more houses than he has to, feels compelled to leave the country and sell off his portfolio to other people, then that’s a sure-fire win for New Zealanders. Bring it on Matthew Ryan ! Leave ! Go on, please do !
My view is that a National govt will lead to a significant uplift in house prices.
Changing the bright line test and interest deductibility rules are huge for landlords (this puts maybe ~200k in the pocket of a landlord over the course of a 30 year mortgage). It also removes a same sized tax advantage for landlords to invest in new builds – thereby decreasing the level of new building.
Backtracking on the MDRS will make it much harder to build more homes – particularly things like backyard studios or 1 beds that are probably a lot of what New Zealand most lacks.
National are making good noises about State Homes, but they’re not core promises – not on their pledge card or anything. Given the numbers in their tax plan are almost entirely made up, they’ll cut spending in certain places – my guess is state homes will be one. “ACT made us do it”
ACTs policy is a total joke – 70% neighborhood majorities required for a developer to build apartments. Nothing will happen.
Captain Haddock – you may indeed be right, but I guess that I would question whether an uplift in house prices should be seen as a good thing – or even as a desirable outcome. Of course, yes, it may well be seen as a good thing by existing homeowners, and definitely as a wonderful thing by investor / landlords, but is it good for the other people living here? Increased house prices are terrible for people trying to buy their first home. They are also terrible for renters. New Zealand already has some of the most unaffordable houses in the entire world, and so an increasing house price would only make that worse, in my view.
There are two alternatives – one is a price crash. The other is no change – ie price stagflation. Ironically, although prices stagnating will be less violently distracting, probably a price crash is the better option. And I mean a real crash – not the gentle letting of air out of the tyres like we have been doing, but a full on, 100kph drive headlong into a brick wall sort of crash. Really drive those prices down.
Agree Nemo! I definitely think house price increases are a bad thing, I guess my comment didn’t make that clear.
Under National’s “Going for Housing Growth” policy, subtitled “National’s plan to unlock land for housing, build infrastructure, and share the benefits of growth”, it is written that :
“National will allocate all remaining funds from the programmes below to Build-for-Growth incentives, which is expected to total around $1 billion. Additional future funding may become available if councils over-achieve their growth targets and those funds are exhausted.”
Existing Programme(s to be scrapped)
Affordable Housing Fund = $235 million savings
Buying off the Plan = $272 million savings
Kāinga Ora Land Programme = $219 million savings
Housing Acceleration Fund = $410 million savings
Total = $1,134,000,000
That’s a pretty unequivical sign that Meathead Bishop is going to kill off the Kainga Ora building pipeline. There we go, back 50 years again….
What they do in Scotland, where the mullet was born. . .
https://www.thetimes.co.uk/article/four-hundred-homes-planned-as-east-kilbride-slashes-town-centre-shopping-r99wfbhd2
Sorry, couldn’t read as it is behind a pay wall…
But I do wonder if this is a sensible policy, seeing as we don’t have enough houses as it is…
https://www.stuff.co.nz/business/money/300969070/immigration-could-hit-100000-new-arrivals-in-a-year-heres-what-that-means
100,000 new people means we need 40-50,000 new homes, just to stand still.
More than a third of East Kilbride town centre may be demolished to make way for up to 400 homes and public space in a plan unveiled by council bosses.
Shop space would be reduced by 40 per cent under the proposal, which South Lanarkshire council has put out for consultation.
The plans include a new civic hub and public square as well as a supermarket and hotel.
“Without strategic intervention the town centre will continue to fall further behind its neighbours,” David Booth, the council’s executive director of community and enterprise, said. “We need to show ambition in order to realise the town’s potential.”
East Kilbride has been hit by the slump in shoppers during and after the pandemic. The EK, formerly the East Kilbride shopping centre and Scotland’s biggest undercover shopping and leisure centre, has 75 vacant units and 47,000 sq m (507,000 sq ft) of empty floorspace.
Administrators were appointed in November after its owner Sapphire collapsed.
The plan to redevelop the post-war town is a collaboration between South Lanarkshire council, architects, property experts and town centre asset managers.
The multistorey CentreWest site, built between 1999 and 2001, has been put forward for demolition and is the possible site for the 400 homes. These would be a mix of flats for first-time buyers and larger homes for family living.
East Kilbride was built after the Second World War along with four other Scottish towns. Its construction was part of a postwar effort to relocate people from slums in Glasgow.
Mark Hewett, the director of Scoop Asset Management, the company-appointed asset manager of East Kilbride shopping centre, said: “The EK masterplan has been created in response to the unprecedented economic challenges.
“We are confident that this visionary mixed-use development, which will see a transformation of EK town centre, will pave the way for future investment.”
Seems like the moderator is napping, so I’ll break my post into two bits in the hope of sneaking it in sooner:
Part One: Problem is, when the National party thinks of immigration it sees this: https://www.rnz.co.nz/news/national/334094/us-billionaire-spent-12-days-in-nz-before-citizenship
He’s a horrible piece of shit, that Thiel bloke. Totally fascist, white supremacist, dodgy ideological leanings, nutty religion, doomsday prepare, who NZ could well do without. Except that he helped fund XERO, which is a great bit of software business. We should still kick him out.
Part Two: when it should be thinking about this:
https://www.rnz.co.nz/news/indonz/496022/immigration-new-zealand-launches-investigation-into-migrant-worker-exploitation
And seriously, this is all just horrible racist behaviour – by Chinese on other Chinese, and by Indians on other Indians. Their ability to ruin their fellow countrymen’s lives is beyond belief. I’d really like Mr Little to get in there with a baseball bat and sort these immigrant-exploiting scum out. Bring back Angry Andrew !!
But clearly, at present, these poor immigrants are not adding to the housing shortage, with 7 to a bedroom and 30 to a house. They’re actually doing us a huge favour right now – but t cannot last.
When the oft-derided MoW brought in tunnellers and dam-builders we got Twizel and Turangi. Now immigrant labourers get extra beds in the flop house if they’re lucky.
Interesting listening to discussion on the hustings about what National propose to do if / when they get elected. Key amongst this is Nicola Willis (National’s currently proposed potential Minister of Finance) who has quite clearly got a completely bullshit plan to collect millions per year from a tax on foreign buyers:
https://www.stuff.co.nz/national/politics/300971104/tova-podcast-rock-solid-on-foreign-buyer-tax–so-will-nicola-willis-resign-if-it-doesnt-work
Willis thinks that “she will make the $740 million a year predicted from selling property to foreign buyers.”
and…
“WIllis has said National’s modelling is based on an average house price of $2.9 million and she’s suggested that lifting the foreign buyer ban and reducing the bright line test (a kind of capital gains tax on property sold within 10 years of purchase) will create a kind of frenzy of sales to foreigners. Before the foreign buyer ban, foreign buyers bought about 3% of New Zealand properties.”
but…
“In 2020, when the bright line test was half what it is now – five years – and house prices were already soaring, 3655 homes worth over $2m were sold in New Zealand. If 5% of those homes were sold at National’s average house price of $2.9 million, National would only make $79 million, a $660 million shortfall.”
So…
“But using our 2020 example, National would need to see another 220 $20 million homes or 440 $10 million homes sold. Right now there are 42 homes for sale on TradeMe over $10 million.”
And of course the question remained – seeing as residency has been given away to many rich toffs – and we cannot treat people from Australia and Singapore as foreigners (because why? I forget – some dodgy law passed by some dodgy government minister?) then many of these possible sales will be unable to attract the tax.
So for this to really work, we have to sell off a mass of really expensive housing to people without residency here, who probably don’t plan to ever live here except in the case of a nuclear war, and they have to be willing to ppay a massive windfall tax of extra money to the government for the privilege. Just remind me – how many times have you heard of stories where really rich people actually voluntarily want to give extra money to the government and pay more taxes? All teh time, right….?
I think that most people who follow this issue (big caveat) know that National’s figures are looney tunes, they are just fed up with Labour and want a change
Incidentally I think that Willis would be a better PM than Luxon and I’ve heard others say the same
Not everyone wants the top job but still…
60mpa – is anything you’re saying ACT policy? Aside from leaving agriculture out of the ETS.
One of ACTs stated policies is to destroy Wellington via taking an axe to the public sector. Losing ~10,000 well paid people would make everything else people whinge about regarding Wellington look like child’s play. That’s without taking into account downstream effects. ( This is a self interested Wellington argument, not really a political one)
No, these are things that I think are good ideas and although ACT will get my vote I disagree with quite a few of their policies.
I find this to be true for most parties – none of them are a perfect fit
I know that this blog skews left, I am to the right of Genghis Khan compared to many
I would wholeheartedly endorse the massive gutting of the bloated civil service, preferably starting with LTSA / Waka Kotahi and MBIE with their shadow agreements with Microsoft doing “lighthouse” deals
Those 10 000 well paid bureaucrats are being paid with our tax dollars and you may well support shelling out for this sort of thing but I can imagine doing something better with the $34 000 tax I pay each year
Have you seen how many shiny-arsed poltroons who do nothing but bleat and create barriers to work getting done there are in the civil service? You’d think that some of them are undercover agents from that pack of loons who want public rail to appear through glueing themselves to roads, the way they hold everything up
How about a decentralisation of work? How about spreading a series of the famous 10 minute cities?
How about Wgtn central being populated only by people who want to be here rather than have to come in for work?
Covid has shown us what it would look like – less commuting time, people spending more time with their families , not being chained to a desk, less sick days, less absenteeism
Yes, Wishbone and others have fallen over and other businesses will as things change
Change is life
Do you live here? I’m not really arguing about the efficiency of the public service, or even what is best from a NZ point of view. From a purely self interested Wellington POV Tax dollars spent in Wellington act as 90% imported cash. I can’t see which sectors in Wellington wouldn’t be massively impacted by the clearout ACT is suggesting – architects, trades, hospitality, all sorts of vendors who contract to govt, etc. In essence, most people who pay 34k a year tax in Wellington are at risk of having bigger problems.
NZTA are likely to grow under an ACT/National govt.
It worries me when you say that you are to the right of Ghengis Khan, because I agree with many of the things you say. How do you feel on beheading infidels? Riding horses at breakneck speed while scything down anyone who gets in your way? And pillaging villages who refuse to bow to your wishes? (I’m mostly in favour of those….).
And while I’m not going to vote ACT, it does have a mixture of sensible policies and downright loony ones. Notes from an EDS political talk this week revealed:
“… the ACT spokesperson… denied there was a climate emergency and said that ACT would repeal the Zero Carbon Act and do away with the Climate Change Commission. He also said that ACT supported mining on conservation land and in the ocean. ACT’s resource management policy would essentially rely on the law of nuisance instead of plans to determine land uses and provide little safeguards against biodiversity loss. The ACT spokesperson’s views on Māori matters were not supported by the other parties.”
“In contrast, the differences between the other parties seemed more nuanced. However, the National Party spokesperson maintained some concerning positions. National wants to repeal the new resource management laws “before Christmas”. That approach is a triumph of retail politics over commonsense and we ask National to think through a more intelligent response in which it amends the new laws to its satisfaction rather than starting over.”
I’d certainly be happy with a dramatic slicing of “consultants” and more hiring of actual knowledgable people directly. I think that it is a crying shame and – in reality, a reprehensible notion – that we have no Government Architect, no Government Structural Engineer, and instead we have everything farmed out to PWC, Deloitte, Ernst and Young, etc. Bunch of number-crunching numpties who charge the earth and do no worldly good for it.
We do have a Government Chief Medical Doctor – and wasn’t it a good thing having Ashley Bloomfield doing his job, instead of Andrew Little or David Clark trying to make it up as we went along? We need competent people in roles of responsibility – and we need them IN government, not swilling around outside it. Just look at America as an example of what happens when democracy gets farmed out to the inadequately trained and uneducated bottom feeders. We thought that Trump was the lowest point of the USA – but the NEXT Trump government will be even worse…
Yes I live here and would point out that we start from a different premise
I don’t believe that government should be as large as it is
Gut away, I’m at peace with that
Wgtn will have less commuter traffic, the digital revolution means that Martinborough and Gonville will become vibrant towns in themselves and people will move out to the provinces chaser a less stressful life working remotely
Although I suspect Marton is too far gone for rehabilitation…
Nemo yes I agree 100% – climate change deniers are total fruit loops but I vote on firearms regulation and apart from smaller government I don’t really go with a lot of their other policies but will hold my nose and tick the box on the day
As for more rightwing ideas I personally support cutting out Working for Families, believe in more crims in more jails for longer sentences and think that patch wearing should be an automatic 30 days in jail
I’d make begging a crime and support castle doctrine so yeah, pretty far away from most lefties
vive la difference
sorry – “chasing
It would certainly have the effect of bringing property prices down ! Wellington has always been a city of two halves – a very Green/Red middle/lower class with a vibrant heart in Aro Valley – and a Civil Service that is probably naturally Blue and far better paid. But i suspect that the colours are thoroughly mixed now, even if the salary levels are not. But if the Civil Service is gutted, then all the cream goes off the top, and the rich move away to non-government jobs in Auckland, then I think that Wellington would be left as a rather poor (financially) city as a result.
re your earlier post about a Govt Architect and a Govt Structural Engineer I really like your thinking on that one and it would be an attraction to those who believe in service to their country over personal aggrandisement
Seriously good idea
“….the digital revolution means that Martinborough and Gonville will become vibrant towns in themselves and people will move out to the provinces chaser a less stressful life working remotely”.
What’s stopping this happening now?
How will you force companies to move, given most have made the choice not to?
How will you force people to live the life you seem to think is better for all?
I’m not forcing people to relocate, I am commenting on market signals
What I am saying is that SARS Cov 2 gave us a fillup in the direction which our society is already headed
As people have “brain jobs” their brain doesn’t have to reside in the office and with decent connectivity, their job can be where they are and as I said it has various benefits of freeing people up to live somewhere cheaper than Wgtn/Auck /London/NY you get the idea
Employers offering remote work should be happier as they get less absenteeism and sick days, employees get their commute time back
It is good for a lot of people except Wishbone and say that crowd of Indian folks in the Railway Station who fix clothing and zips
And cab drivers
And Art galleries
Ans anyone who relies on big city foot traffic
This is analogous to the way that houses used to have telephone numbers and now people have telephone numbers. capiche?
So what this points to is the possibility of cities fragmenting regionally into digital villages – imagine you bought a cheap farm out on Mahia peninsula and moved a bunch of houses in say about 15 to 20 with their own little patches of green space then a whacking great big satellite dish getting a fat uplink
It would be possible to attract digital workers with the no commute lifestyle knowing that their kids were safe but could still play in streams and run around paddocks
I think that this “mobile, everywhere” situation is evolving naturally for work (just like it has for phones) so I’m trying to point that idea out more than force individual taxpayers what to do with themselves
Hope that idea makes sense and I would be happy to be completely wrong, I like to think about the future
60mpa – I think you’re political beliefs are fine, whatever really. I’m not arguing them.
But it’s disingenuous to pretend losing 10,000 well paid jobs, plus downstream effects would somehow have a positive benefit for Wellington itself. Do you think Wellington should also attempt to get the Film Industry and XERO to leave town?
Really this is a pretty obvious cost to gutting the public service (whether or not you think that should happen). In the same way that bringing agriculture into the ETS would have negative impacts on farmers, whether or not you think that should happen.
Oh Captain my Captain
Please don’t get me wrong, I agree that for every single one of these mythical 10 000 civil servants losing their jobs it would be terrible for them
What I AM saying is that the prospect of mass layoffs amongst the civil service is one which I would hearily welcome because my political belief is that a lot of them do very little except add costs to others
That clear Capt H?
One other thing that will rear it’s head in the work-from-home future that I do not see discussed enough is that NZers who are WFH cost more in wages than Venezualans / Nigerians / Phillipinos
First it is call centers, next it will be Quantity Surveyors, Paralegals, etc and if the poor but well-educated aren’t lining up to eat your WFH lunch, AI is waiting in the wings…
Spooky
Without question we have a housing crisis. It is however quite different in some ways to the pre-Covid, or more accurately pre-market correction / interest rates increasing. The economics of development are quite different – and far far less attractive than when interest rates were low, construction costs were lower, and property prices were higher. We have seen many projects put on hold / cancelled – though others of course have proceeded. Be careful what you wish for when wanting a market crash Nemo!
The other question is what will Wellington’s future population growth rate be? WCC is still talking 50-80,000 over 30 years, and investing / planning accordingly which is I think an increasingly unlikely scenario, and carries huge risks if the numbers are a long way off. Those numbers largely carried on the trajectory of growth (in % terms) over the previous 30 years. It is worth contemplating that Wellington City’s population grew 13% from 1956 – 1976, but just 4.6% between 1976 and 1996.
We know that as a nation we are now at less than replacement level – natural / births per woman – and have been for a few years.
Therefore national population growth is dependent on migration – which is currently astronomically high, but a lot of that is make up from Covid when it fell to nothing (or slightly negative). There’s been a failure of successive Governments to have anything remotely resembling a strategy, but instead to have only a set of often incoherent ad hoc operational changes. It’s a classic example of if you don’t know where you are going you are bound to get there. Our competitive position against other countries will also be key. Every day we are reminded that Australian wages are higher, and their recent opening of the pathway to citizenship adds to that competition for talent and skills.
60 is bang on the money with the other key aspects – work from home is a real problem for Wellington central in particular. As 60 says, and I said right through Covid, we now have to ensure Wellington is a place where people choose to be, because now people have a choice that clearly wasn’t exercised anything like as much pre Covid. It’s pretty clear that there are a range of views about whether WCC actions are encouraging people to come in, or pushing people away. I suspect we will see a shift away from Wellington City dominating regional growth as it did in the early 2000s, and a greater proportion of people choosing to live in cheaper housing further from town – as they don’t have to come in so often.
60 is also 100% right that a significant reduction in the size of the public sector will ripple through the local economy and will impact the city too.
In short – the planners would be well advised to think about their assumptions, and about scenarios, and that while we can absolutely influence the future, we should not pretend that one given future is certain.
If we can’t beef up the road/rail corridors in from SH1 and SH2 direction then we need to shoehorn a lot more housing per sq m into everything South of the Jarden Mile
Plenty of Greenfield space in Makara but it’s a windy shithole ( I should know, I lived in South Makara Rd for 8 years) and we don’t have to get silly by doing things like an under harbour tunnel and opening up the East of Eastbourne
How about, while we are waiting on the resource consents for our apartment blocks to come through, we re-purpose the abandoned office buildings into apartments?
Nothing like a bit of recycling
Thanks Andy (and nice to see that you are still around and still interested), and thanks also to 60mPa who, as usual, has a lot of sensible stuff to say for someone so dashingly concrete… although I’m worried to hear that you were a Makara man as I always thought you sounded like a Hutt lad, and imagine you as large, hairy, and driving a big black ute – as many from the Hutt seem to do. Makara seems to imply that instead you may be a kale-eating, mountain-bike rider, drinking kombucha, and I may have to revise my mental picture. Actually, Andy Foster is the only one that we all know what he looks like (sometimes in a suit, but always on a bike), while the rest of us are all largely unknown to each other. Anyway – off topic! Byegones!
Love this phrase from Andy “if you don’t know where you are going you are bound to get there.”
Re: turning abandoned office buildings into apartments – already working on a post about that.