Brian Rudman: The housing crisis - a private solution

Illustration / Peter Bromhead

Fletcher plan dramatically lifts number of new homes offered to Auckland ... and it doesn’t have to get past a vote

At long last the cavalry has ridden in to deal to Auckland's housing crisis. Indeed, not one cavalry, but several.

For those who see it as a supply problem, look no further than Labour, which is pledging to build 100,000 affordable houses nationwide over 10 years for sale to first-home buyers. Most of these are destined for Auckland.

National, which regards such direct intervention in the market as an anathema, prefers to tinker with a carrot and stick approach, on the one hand muscling the Auckland Council into fast-tracking building consents in newly designated "special housing areas", on the other, dangling $10,000 grants before first-time buyers.

And now, for those waiting for the sainted market to grind into action, in ambles Fletcher Building, the nation's construction giant.

Last October, chairman Ralph Waters signalled Fletcher's aim to lift its house-building rate in Auckland from 300 a year to 1000.

It had just bought the Manukau Golf Course and was on the hunt for other large open spaces. He talked of moving from Fletcher's traditional stand-alone housing into medium- and high-density housing.

Chief executive Mark Adamson said the first venture along these lines, Stonefields, had been "very successful" and new sites were being sought. He said new housing solutions would be critical in ensuring Auckland's growing population could be accommodated.

Mr Adamson has now upped the goal to 1500 new homes annually within four or five years, with a pipeline of at least 3000 to 4000 sections in readiness.

He told Herald property editor Anne Gibson that Fletcher had a land bank of hundreds of hectares in Auckland and was acquiring more.

To underline its intentions, Steve Evans, a Melbourne engineer responsible for some of London's biggest commercial and residential projects, is Fletcher Building's new housing boss.

Mr Adamson says "the way to reduce building costs is to do it in scale".

This brings Fletcher back to its roots. Biographer Selwyn Parker writes how in the Depression years, company founder James Fletcher befriended future Labour leaders Peter Fraser and Walter Nash.

On the overnight express to Wellington he argued the need for government stimulation of the economy. After Labour's 1935 victory, he was invited to draw up a scheme for building state rental housing, then won the tendering process.

We're not talking state rentals now, but Fletcher is bringing a similar mood of urgency to the current crisis.

In the year to June, it built 289 homes in Auckland; in the year to next June, it is looking to build 500 houses. Then, over the next few years it plans to crank this up to 1500 a year.

Compare that to the Government's Hobsonville Point development at Whenuapai, which after five years, is on target to have completed about 400 homes by the end of the year.

It might come as a surprise to Housing Minister Nick Smith that Fletcher has, or is planning, a revolving land bank of at least 3000 to 4000 sections.

A year ago, he was threatening mayor Len Brown with his big stick over Auckland having only "1300 sections available for housing ... [when] ... we need 13,000 a year just to keep up with population growth."

This was his excuse for ramming through the "special housing areas" legislation, enabling developers and speculators to apply to fast-track existing planning rules to accelerate home building. If he'd known of Fletcher's cache, he could have calmed down.

Pushing the enabling legislation through Parliament last September, Dr Smith's diagnosis was "we've got a constipated planning system bogging down new residential construction and this bill is a laxative to get new housing flowing".

If planning consultant Jon Maplesden is to be believed, instead of new housing flowing as a result of the new legislation, it is the special housing areas that seem to be on the move. Several of them are up for sale, once gaining the added value of their fast-track status.

True, alongside Labour's promise to build 10,000 starter homes a year, Fletcher's proposal might seem puny. Also, there's no indication whether any will qualify as "affordable". But in its favour is that, unlike Labour's proposal, it is not dependent on a ballot in three weeks.