Buying in the wops? Factor in car costs

Rush hour traffic heads out of Auckland City towards the North Shore. Photo / Dean Purcell

Migrating to the outer suburbs may not be the affordable dream many Aucklanders believe, according to a new study which lays bare the true cost of commuting.

Researchers have for the first time created a detailed picture of housing affordability in New Zealand's largest city when commuting costs are factored in, with surprising results.

One calculation showed that the most affordable homes could even be found in some inner areas of the city.

"When you take into account that people in outlying areas are so much more dependent on automobiles than people in inner-city neighbourhoods, transport costs should play a role in what locations we consider to be affordable or not," study co-author Kerry Mattingly said.

The study, co-authored by Dr John Morrissey and published this week in scientific journal Cities, criticises status quo housing affordability measurements for not properly taking transport costs into account.

The researchers created two separate income-based indicators to measure combined commuting and housing affordability across different suburbs of Auckland.

This stands in stark contrast to measures considering housing costs in isolation, which show affordability generally improves with distance from the centre of the city.

One of the indicators, which they said presented a more accurate picture of how affordable an area would be for a typical family to live in, found the most affordable areas were found in the lower central, inner-west and inner-south of Auckland.

Areas close to employment hubs appeared relatively more affordable using the measure due to modest expenditure on commuting.

In some peripheral areas, average annual commuting costs could be five times the amount shouldered by those living in many central Auckland neighbourhoods.

While mean commuter costs for some of the furthest reaches of Auckland was higher than $4000 each year, some neighbourhoods around the CBD incurred less than $600.

And while many of these "accessible" neighbourhoods came with high housing prices, low commuting expenditure could often compensate, the researchers found.

"If you just look at housing costs alone, outlying areas appear really affordable and it initially seems to make sense to say, hey, let's open up greenfield sites on the urban periphery and develop here," Mr Mattingly said. "But when you include these broader costs, they are not as affordable as they seem."

He said the results went against the traditional notion of "drive 'til you qualify".

When wider social impacts such as increased pollution were taken into account, low-density, urban-fringe expansion was even less ideal, he said.

While increasing the supply of housing may well help to lower the cost of housing, Mr Mattingly said it was the way in which supply was improved that was important.

"In particular, the location and density of residential development will have strong implications for associated transportation costs, combined housing and transport affordability, and long-term environmental sustainability."

Policy-makers needed to consider the relationship between housing and transport, and strike a balance between an adequate supply of land for development and intensification.

Auckland Council chief economist Geoff Cooper agreed the city needed a better measurement of housing affordability.

"The measures that are currently used are just measurements of income relative to house prices, or other reasonably simplistic measurements."