Property editor of the NZ Herald

New housing areas used for speculation - Labour

Special Housing Areas are supposed to help get new houses built more quickly across Auckland.  Photo / Doug Sherring
Special Housing Areas are supposed to help get new houses built more quickly across Auckland. Photo / Doug Sherring

• Special Housing Areas are the Government/council solution to our housing crisis
• Aim is for 39,000 new Auckland homes and sections to be consented
• Yet with nearly three years up, only about 700 residences are finished
• Houses have only been completed in 19 Special Housing Areas out of 106
• Phil Twyford says those numbers show the scheme has failed
• Government minister defends scheme, saying SHA land trading to be expected

They're supposed to be Auckland blocks of land designated 'special' to boost the city's housing supply - instead, says Opposition MP Phil Twyford, they're being traded like horses, used to make people rich.

But Housing Minister Nick Smith has batted that away, saying land trading is to be expected and all part of the process.

Special Housing Areas are supposed to help get new houses built more quickly across Auckland.  Photo / Doug Sherring
Special Housing Areas are supposed to help get new houses built more quickly across Auckland. Photo / Doug Sherring

Twyford, Labour's Auckland issues, housing, building and construction spokesman, pointed to the sale of a South Auckland block of land, designated a Special Housing Area under the Auckland Housing Accord between the Government and Auckland Council.

Twyford said the Trade Me advertisement was for 141 Park Estate Road at Papakura where the price is to be negotiated.

The 2.83ha of land is advertised as in the Hingia Special Housing Area and its promotion says: "Perfect for an active investor or a land banker to live in or rent out while waiting for the development to happen around them. This property will appeal to landbank investors and developers looking to invest in one of New Zealand's fastest growing communities."

Instead of such precious blocks being developed and offered to the market with dozens of completed houses, speculators could cash in, Twyford said.

The SHA build rate was pitifully slow: only approximately 700 dwellings were completed under the deal, Twyford said.

"I believe one of the main reasons for the slow build rate in the SHAs is that the land is appreciating so fast - at the rate of about 25 per cent last year - that it discourages developers from actually building. When the value of the land is going up so fast, why not hold on to it, or sell it and make a profit, instead of taking on the risk involved with building?" Twyford asked.

SHAs were just more tinkering by the National Government, he said. But Smith said SHA section trading was not damaging the scheme at all.

"The objective of the SHAs and the Housing Accords is to fast-track the zoning process so as to increase the supply of land available for housing. Changes in ownership do not undermine this objective and sometimes it will help because the current owners may not have capital to develop the land into sections.

Special Housing Areas are supposed to help get new houses built more quickly across Auckland.  Photo / Doug Sherring
Special Housing Areas are supposed to help get new houses built more quickly across Auckland. Photo / Doug Sherring

"The trading in land is nothing new and occurs all the time as land moves through the development stages. It occurs in response to expectations that an area might be rezoned, when it is rezoned and whether this rezoning occurs through the normal or special housing process.

"The best way to reduce the financial gains from rezoning is for council to better match the amount of zoned land to demand as this removes the premium paid for a shortage. The special Housing Areas are helping achieve this in the short term.

"The Unitary Plan, Urban Policy Statement and Resource Management Act changes will achieve it long term," Smith said.

Twyford's claims that a future Labour government would stop land speculation was hollow, Smith said.

- NZ Herald

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