Generation Zero willing to forfeit quarter-acre dream

Former Reserve Bank chairman Arthur Grimes says the answer to Auckland's housing crisis is to build up and "flood the market". Photo / Doug Sherring

Young Kiwis looking to get on to the Auckland property ladder are willing to forfeit space for the promise of proximity to the city, a youth advocate says.

Generation Zero governance team member Carlos Chambers made the comment in a panel discussion on Auckland housing at the Aotea Centre tonight.

He said young New Zealanders were "re-evaluating the core pillars" of a good life and the average young Kiwi did not share the same quarter-acre dream as their parents did.

City living remained attractive to young New Zealanders, and the prospect of not owning a garden did not concern the younger generation - they were "willing to take hits" if it meant proximity to work and play.

Mr Chambers said an apartment held more appeal than a three-bedroom house with a garden on the outskirts of Auckland.

The Generation Zero member said he had no personal desire to become a home owner, and the attitude of "you need a house to get rich" needed to shift.

"Fifty-two per cent of our private wealth is tied up in our residential housing market," he said.

Mr Chambers said there needed to be a focus on creating new businesses and encouraging entrepreneurialism. In the past, housing was viewed as key to success; in the future, entrepreneurship will ensure success, he said.

Former Reserve Bank chairman Arthur Grimes said that before 2007, Americans also believed home ownership equalled success, but "we have to learn from history, collapses do happen".

Politicians said $600,000 was too high for house prices five years ago ... the median house price in Auckland is now one million. We need to take them back to a level where they were already too high.

Arthur Grimes

The senior fellow at Mutu Research said the answer to Auckland's housing crisis was to build up and "flood the market".

Mr Grimes proposed a new target of collapsing Auckland house prices by 40 per cent.

"Politicians said $600,000 was too high for house prices five years ago ... the median house price in Auckland is now one million.

"We need to take them back to a level where they were already too high."

He said people needed to put an end to the idea that Auckland is large; it was a myth that it was a sprawling city.

"It's not a demand problem, it's a supply problem ... it means we have to up and out to get the prices down."

He questioned why Orakei and St Heliers weren't already "like the Gold Coast".

The city needed to build up and think about the next generation, and Auckland may be able to rival Perth.

"Demand is a fantastic thing."

Mr Grimes said the big worry has been climate change - with a growing population in Auckland, there was worry surrounding carbon emissions.

But "the future will be electric" - and people won't be driving cars with internal combustion engines.

Engage, engage, engage and vote, vote, vote your head off.

Bernard Hickey

Veteran business journalist Bernard Hickey, publisher at Hive News, emphasised the importance of voting and engagement if the shape of the Auckland housing market was to change.

"Look at the people voting for local councils, it's older property owners."

Mr Hickey said solutions were known, but "politics gets in the way".

Young people are failing to vote for their local councils.

"Engage, engage, engage and vote, vote, vote your head off," Mr Hickey encouraged.

Panel member Helen O'Sullivan, chief executive of apartment development company Ockham Residential, said Auckland needed to build up.

She said what was missing was three-level character flats like those of the 1950s.

"It's what you see in Melbourne and Sydney and what could be implemented in Mission Bay and Herne Bay.

"The reality is, if we keep going out, we will annex Hamilton quite soon."

Ms O'Sullivan said it was about providing options for Aucklanders.