Cost of Christchurch central city residential development 'too high'

New research has found Christchurch people are more likely to buy in the outer-suburbs, rather than apartments like these on Park Tce. Photo / Martin Hunter

The high cost of developing and buying in Christchurch's central city has again been identified as stumbling blocks to repopulating the area.

City councillors yesterday voted to begin a new programme of work aimed at accelerating central city residential development.

The city council and Government want 20,000 people living in between the four avenues by 2020. But progress has been slow.

Last month The Star revealed a study found people were more likely to buy in the outer suburbs because properties were cheaper, larger and more private.

City councillors discussed the issue yesterday, after the Development Forum met with those in the industry to see what was holding central city residential development back.

Forum chairman and city councillor Jamie Gough said it was expensive.

"We're all aware that the land value in the central city has been propped up artificially and that's discouraging because the developers are obviously going to go where it's financially attractive."

He said while the city council's development contributions rebate was helpful, it was often not enough to get them over the line. Banks also required 80 per cent of the development to be sold before ithey will lend money, he said.

Otakaro opened the $30 million Rauora Park on Tuesday, which will eventually be surrounded by about 900 East Frame apartments and townhouses.

Mayor Lianne Dalziel said there needed to be a range of price points.

"You spend $1.2 million on a small townhouse in the CBD and buy a mansion out in Avonhead for the same price. That's the challenge."

As part of the new programme, the city council will work with stakeholders to identify barriers, encourage more diverse housing, improve street maintenance, and market the central city as a good place to live.

"We can't pull all the levers because some are out of our control. But if we can indirectly affect them then I think we could be doing that," Cr Gough said.

City councillors have also asked for staff advice on landbanking, whether a regeneration plan could help, and what options there were to work with the Government on the issue.