A leading Tauranga developer has warned slums would be the result of dropping building controls in city subdivisions.
Peter Cooney, of Classic Builders, hit out at claims by Tauranga Mayor Stuart Crosby that building covenants used by developers to guarantee a certain standard of housing were a reason for Tauranga's affordable housing crisis.
Mr Cooney used yesterday's hearing of submissions on Western Bay's urban growth masterplan, SmartGrowth, to answer Mr Crosby's criticism.
Tauranga City Council estimated that covenants in Papamoa's Golden Sands subdivision were adding about $48,000 for a three-bedroom home and attached garage with internal access, compared with a base-model 90sq m home with a stand-alone steel garage.
Mr Crosby said covenants did not allow for the construction of the basic, small home that many New Zealanders grew up in.
"To improve the affordability of new housing in New Zealand we need to start building smaller, simpler houses again."
Mr Cooney responded, saying "If you don't have covenants you open yourself up to potential slums."
He said having no garages, for instance, created an untidy residential landscape with cars and furniture sitting outside. Covenants were designed to get a certain look and shape to subdivisions, making it a safe investment for homeowners.
Mr Crosby said he was not opposed to covenants and understood why they were there. However, they contributed to the cost of building a house and in many areas were "way over the top".
"It is the added extras that drive the price up."
The mayor and Mr Cooney agreed the high costs of building materials in New Zealand, compared to Australia, were contributing to New Zealand's affordability problems.
Consultant planner Aaron Collier, appearing for Fairway Holdings, said barriers to affordable housing were largely related to the cost of infrastructure and unsustainable development contributions, land cost and regulatory barriers.
He urged SmartGrowth to facilitate affordable housing through the use of "alternative zones" within urban areas.
The idea of using targeted rates to "front-load" infrastructure costs for new subdivisions was dismissed by Tauranga councillor Larry Baldock who said it made rates unaffordable.
Mr Cooney highlighted how Classic Builders was involved in "shared equity" housing schemes in Queenstown and Auckland where a certain number of sections were earmarked for affordable homes and first homeowners did not have to stump up with the full amount. For instance, 25 per cent of the equity could be held by the council which got its money back when the owner sold.
Clarkson makes plea to developers
Tauranga developer Bob Clarkson has asked the Government to force developers into introducing an affordable housing component to their subdivisions.
Mr Clarkson was speaking to a Parliamentary Select Committee hearing submissions on the Housing Accords and Special Housing Areas Bill.
He spoke after Tauranga Mayor Stuart Crosby had highlighted the issue of how much building covenants increased house costs in greenfield subdivisions, compared to a smaller and simpler designed home.
Although the Bill was primarily aimed at improving Auckland's housing supply and affordability, Mr Clarkson said he wanted Tauranga to also become a Schedule One area.
He told the Select Committee that just releasing land would not fix the problem.
Developers controlled the market by sitting on blocks of land, leaving councils stuck.
"We have got to stop it ... we need to put rules around it."
His ideas included that 50 per cent of houses in new subdivisions should be affordable houses before resource consent was granted for a development.
Mr Clarkson wants to build a thousand fixed-price affordable homes on farmland which he owns beside the Wairoa River at Tauriko, but a review of the Western Bay's strategy on where growth should be allowed to happen did not anticipate any changes in the land's rural zoning for at least five years.