Figures raise buyer questions

With our motorways full, more new houses means more infrastructure and better transport options will be needed.

The latest QV figures show home values are rising again across Auckland despite many areas seeing a brief drop in values between October and March following the introduction of measures to curb those investing in housing.

So just who is buying the city's houses and driving up values?

It was hoped new data from LINZ would shed some light on this. However, the agency has admitted its data has limitations. It did find more than half (51 per cent) of all sales between January to March were to investors with NZ based IRD numbers. It also showed 4 per cent of sales were to those with an overseas tax residency (foreign investors).

We still don't know exactly who makes up the 51 per cent of investors buying property with NZ based IRD numbers. These investors could include NZ citizens, permanent residents, new migrant residents and foreigners on temporary student and work visas as well as locally based companies or trusts -- including those set up by foreigners who invest here through those mechanisms.

We do know net migration continues at record levels and this population growth coupled with demand from investors, means Auckland's housing supply isn't able to keep up with demand and this continues to drive home values up.

The latest QV stats show the average value in the Auckland region is $942,760 and that the housing market rose 16.5 per cent over the past year. If values continue to rise at the same rate during 2016, then by this time next year the average (Auckland) value will top $1 million.

With new measures not appearing to have made much of a dent in demand from investors, and new migrants continuing to arrive, the lack of housing is putting the spotlight on Auckland Council's Proposed Auckland Unitary Plan (PAUP) process and the sale of Housing NZ homes in the city.

The Auckland Plan calls for 60-70 per cent of the city's growing population to be housed within the existing metropolitan urban boundary, which will only be possible with an increasing proportion of higher-density housing.

Understandably, some Auckland home owners are concerned about what higher density will mean and it's a fine balance to provide enough new homes while retaining the city's intrinsic aesthetic value.

As well as wanting to see greater intensification, the Government is now calling for more land to be freed up outside the metropolitan urban boundary (MUL) so it can spread out.

However, Auckland Council doesn't believe this is necessary, as it already approved developments outside the MUL that could provide up to 23,000 homes over the past three years. Plus it has 11,000 hectares of land earmarked for future urban development under the PAUP, (that's about one and a half times the size of Hamilton) over the next 30 years, with the potential to build 110,000 new homes.

However, it says this land can't be developed for housing without spending in excess of $17 billion on infrastructure to service the land.

With the motorways full, this infrastructure would need to include regular alternative transport options such as a fast-track commuter train service as far out as Wellsford to the North, Helensville to the West, Pokeno to the South and Howick to the east. Plus with the city's hospitals, schools and other public amenities already at capacity, we already need more of these within the existing metropolitan urban boundary before we can consider building more houses further out. Given all this, the idea of having a national housing conference to flesh out how best to help Auckland grow seems a good idea.