Housing Minister Nick Smith is to oversee the building of hundreds of new homes and wants more than a third priced for first-time buyers, writes David Maida.

The Government allocated $52.2 million in the Budget to free up around 500ha of Crown land for home construction in Auckland.

Labour Party leader Andrew Little suggested the Government's draft list of "Special Housing Areas" included the Mangere Lawn Cemetery and land adjacent to the Hepburn Road Substation.

In Parliament, Little referred to the plan as "the building of unaffordable houses among Auckland's power plants and gravestones".

Prime Minister John Key responded in the House saying he did not have the list of properties so was unable to confirm if Little was correct. However, Building and Housing Minister Dr Nick Smith defended his plan to build homes next to the Hepburn Road Substation.

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"The substation is only in one corner, and there are 3ha of vacant land. Why would we not consider a housing development on the remainder of the vacant land?" he said.

There were no graveyards on Smith's current list of sites to be developed - they are Manukau, Avondale, Massey East and Hobsonville. It's expected these properties, consisting of 30ha, will be used for 600 homes. A figure that's nowhere near the 25,000 homes needed in the Super City.

"We are taking to Auckland the approach we have already applied with success in Christchurch, where we partnered with the private sector to deliver more than 400 homes on surplus public land at Awatea, and Welles and Colombo Sts," Smith said.

He wants 20 to 38 per cent of the new homes to be priced as starter homes. But the exact proportion is to be determined through negotiations case-by-case.

"Our initiative is about boosting, not just supply, but also ensuring more homes are built [that are] suitable for first-home buyers," he said.

That would likely mean that at least some of the homes would be priced at or below $550,000.

Smith said: "The rate of new house builds in Auckland has doubled over the past three years and investment in residential construction reached an all-time high of $2.6 billion in the year to March 2015. This latest Government initiative is about ensuring we maintain this momentum."

Smith said the initiative is not a "silver bullet" to fixing Auckland's acute shortage of affordable housing, but is one step in his plan to improve housing supply and affordability.

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The next steps are to assess the commercial viability of these sites with regard to zoning and infrastructure. The site at Massey East was set aside for a high school that was eventually built at Hobsonville. The land is apparently surplus to the Ministry of Education's requirements.

"This site, with a capacity for about 200 homes, is within close proximity of the Royal Rd on-ramp to the Northwestern Motorway, is located on major bus routes connecting to the CBD as well as amenities like parks, schools and a major shopping centre," said Smith.

"It already has access to water and waste infrastructure - meaning housing development will be able to proceed more quickly."

Another of the sites is in Manukau and has potential for intensive housing close to the town centre and rail links. The site in Avondale is zoned for terraced housing or apartments. The last site is at Brigham Creek Rd, just off the Upper Harbour Motorway near the Whenuapai airforce base.

Smith wants to have a development agreement for the Massey East site before the end of October. Earthworks would start over the summer, with the first homes completed in late 2016. He says the Government is investigating additional sites on Crown land to assess their suitability for housing. But just as important as "where" is "when".

Building consents have dropped off nationally, which is not a good sign for people looking to buy a home. In April, consents for new dwellings fell 1.7 per cent to 2112 for the month. Of those, 49 were for retirement village units and 467 were apartments.

Although Smith may have some grand plans, there is concern construction resources are still tied up in the Christchurch rebuild. The director of Rebuild Christchurch, Deon Swiggs, says residential building works there won't be completed until 2017.

"My guess would be that Auckland won't see a big rise in residential construction due to planning and then a potential labour shortage for probably 18 months - two years," Swiggs says.

He also says the Auckland home building market has a momentum of its own.

"In respect to the need in Auckland, even with our rebuild, Auckland is still consenting more houses. So, there is still more work going on there than here.

"I am unsure if there will be capacity right now but I can see that many of the people that are in trades training will probably end up working in Auckland."

Fletcher is the Government's prime partner in building homes on Crown land, and is confident there are enough competent tradespeople to take on such a huge project.

Chief operating officer for Housing at Fletcher Building, Steve Evans, says their early work as part of the Christchurch rebuild demonstrated the company's capability.

"We don't know the numbers of houses that are being put up by Ministry of Business, Innovation and Employment (MBIE), but we are comfortable in terms of our forecasts going forward that we can deliver houses into the Auckland market that we're given access to," Evans says.

Fletcher has tasked Evans with ramping up the capacity of the construction company to deliver new homes. He says he is working with developers, Government and other partners to increase the supply of new houses.

Evans maintains there is no skill shortage in his business at the moment, but they continue to seek quality people as either workers or subcontractors.

Evans says they would need to look at the infrastructure of the sites in Smith's plan.

"One of the exercises that we do as a developer is look at how do we fit into the existing community. Are there needs to augment some services in those existing communities as a result of the residential community building exercise?"

Evans says the firm is looking for new building technology all the time. Fletcher is considering different forms of build as well as traditional. It's considering panelised pre-fabricated systems and volumetric construction, with elements that are manufactured off-site.

But in the current market, prefabricated building products tend to be expensive. Evans says house prices are made up of several elements and that construction is only a small part. He is part of a team within Fletcher working on ways to lower home prices.

"If you are looking at addressing the affordability of houses, then you need to look at the land price, the house size, the development contribution, construction costs. There is a variety of different levers that can be pulled from an affordability point of view."

Current building sites

Moire/Granville Rds, Massey East

Land size:

9.5ha

Houses:

200 (approx)

Owned by:

Ministry of Education

Likely dwelling types:

Detached houses

Distance from CBD:

17km

Transport:

090 bus route. It is within 1km of on-ramp to the Northwestern Motorway

Schools:

West Harbour, Hobsonville Point Secondary

Shopping:

700m to Royal Rd and 2.2km from Westgate Centre.

Wiri Station Rd, Manukau

Land size:

1.4ha

Houses:

60 (approx)

Owned by:

NZ Transport

Likely dwelling types:

Terraced

Distance from CBD:

22.1km

Transport:

100m to Manukau station

Schools:

Puhinui School and Papatoetoe High.

Shopping:

750km to Westfield Centre and 1.1km to Pak'n'Save.

New North Rd, Avondale

Land size:

0.37ha

Houses:

60 (approx)

Owned by:

NZ Transport

Likely dwelling types:

Terraced, apartments, high density

Distance from CBD:

9km

Transport:

80m to bus stop, 700m to Avondale train station

Schools:

2km to Avondale Intermediate and College

Shopping:

110m to Pak'n'Save.

Brigham Creek Rd, Hobsonville

Land size:

19.94ha

Houses:

280 (approx)

Owned by:

NZ Transport

Likely dwelling types:

Detached

Distance from CBD:

23km

Transport:

Hobsonville Point ferry and buses

Schools:

3.2km to Hobsonville Point Primary and 3.3km to Hobsonville Point Secondary

Shopping:

4.9km to Westgate Shopping Centre, 3.7km to Albany Westfield, and a new Hobsonville Countdown supermarket is in development

Source / MBIE