Tuesday: Circuit breaker, fast track, or just another talk fest?

Legislation will be introduced to Parliament as part of Budget 2013 to enable special housing areas to be created by the Auckland Council.

However, at the same time, the Reserve Bank is making it harder for first home buyers by requiring banks to impose higher loan to value requirements, raising questions about the effectiveness of the fast track housing initiative for those that most need it.

In the areas designated, it will be possible to override restrictions on housing created by Auckland’s eight predecessor councils – notably the metropolitan urban limit or “green belt.”

New greenfield developments of more than 50 dwellings will “be able to be approved” in six months compared with the current average of three years.

Brownfield developments will take three months compared with the current average of one year, the accord partners claim. 

The process will not be available for high-rise developments that will need to be considered under existing rules until the Unitary Plan has been finalised in 2016.

The accord targets 9000 residential houses consented in the first year, 13,000 in the second year, and 17,000 in year three – a significant rise on the average 3600 homes that have been consented each year over the past four years and the 7400 a year over the past 20 years.

The accord was struck after several weeks of discussions with Auckland mayor Len Brown and council and government officials. 

The accord legislation will expire when the new Auckland Unitary Plan becomes fully operative, expected in 2016.

 The Property Council New Zealand has welcomed the changes and says it will begin reviewing the detail of the plan to identify any ramifications for the private sector. 

“The proposal for regular reporting is particularly welcome, as it will help ensure transparency and accountability. The reports will clearly show whether the panel is approving enough developments to relieve pressure,” Property Council chief executive Connal Townsend says 

“The commercial property industry will no doubt face some challenges in meeting these targets and there are a number of supply issues to work through. We will consult with members about some of these issues over the next week,” Mr Townsend says. 

And the Employers and Manufacturers Association says the accord could be the circuit breaker needed for Auckland.

Housing Minister Nick Smith has also commissioned a market study into residential construction costs.

“The costs of building a house in New Zealand are too high as identified by the Productivity Commission’s report. This issues paper and market study is about identifying why some house construction costs are as much as 30% more expensive than Australia and how we can get costs down,” he says.

Submissions on the Residential Construction Sector Market Study issues paper close on June 10, 2013.