Surge in Auckland building activity with new home consents up 24 per cent

Tuesday, 7 May 2019

Building activity in Auckland is at rates not seen since the mid-1970s (file photo).

Auckland is experiencing a rapid increase in building activity, with new home consents up 24 per cent over the last 12 months.

For the year ending March 2019, 13,874 building consents were approved, according to the latest figures released by Statistics New Zealand.

Housing affordability will not be a reality until restrictions on land supply are addressed, ACT Leader David Seymour says.

Construction statistics manager Melissa McKenzie said building activity at that rate had not occurred in decades.

'New homes consented in Auckland and New Zealand are at levels last seen in the mid-1970s,' she said.

* Record building activity in Auckland with 10,000 dwellings approved in 2018**

Auckland Council approves a building consent for construction to start on a new home when the project meets the regulations outlined in the Resource Management Act 1991 and Building Act 2004.

Planning committee chairman Chris Darby said it was great to see the figures going in the right direction.

'The volume of consents that we're issuing in Auckland is phenomenal,' he said.

'We've been making a concerted effort to improve our consenting performance. It’s been an organisational priority for council and it's good to see the efforts of our teams paying off.'

ACT Leader David Seymour said the news was positive, but addressing land supply was central to the issue of housing affordability.

'Since 1993, the price of an Auckland section has increased by a whopping 903 per cent,' he said.

'The housing crisis has been created by local and central governments artificially constraining land which makes houses more expensive.'

Seymour said ACT would change the Resource Management Act which 'gives councils too much power to restrict new development.

'We would remove the rural-urban boundary so that Auckland can grow out, boosting the supply of land and bringing down its cost,' he said.

'Until land supply is addressed affordable housing will not become a reality in Auckland.'

The rural-urban boundary is a council zoning policy which restricts building activity from taking place in the rural outskirts of the Auckland region.

The price of a section of land within the boundary is about 10 times more expensive than one outside it, according to data from independent economic think-tank the New Zealand Initiative.

But Darby said Auckland didn't have a land supply issue, it had a housing supply issue.

'The rural-urban boundary gives certainty for both urban and rural landowners as to where future urban areas will be,' he said.

'It also prevents urban sprawl into areas of elite soils, places with natural or cultural significance, natural hazard areas or areas where the geography makes it difficult for land to be developed.'

Darby said there was sufficient land supply to build millions of dwellings and it was instead the supply of houses that was the issue.

'The Auckland Unitary Plan enables over one million dwellings to be built in existing residential areas. This is achieved by removing density restrictions, reducing parking requirements, and increasing height,' he said.

'It also identifies sufficient greenfield land for an additional 137,000 new dwellings within the rural urban boundary for around 30 years' growth.'

The Unitary Plan in 2016 saw regulations on building density relaxed to free up land.

The median house price in Auckland is $856,000, according to Real Estate Institute of New Zealand data.