The Government and the National Party recently announced agreement about the need to make it easier to build more homes on residential sections in our major cities, presumably with the hope that this would take some of the upward pressure off house prices.
But in the Herald on Sunday (14 November 2021), Ben Leahy noted that house prices continue to rise rapidly.
The reasons for this can’t relate to a high rate of immigration: we’ve had almost no net immigration since the pandemic began.
So what’s happening? A friend offered me a clue by noting that, in a paddock in Papakura, 400 square metre sections are currently on sale for $977,000. The section alone is wildly beyond the budget of ordinary wage and salary earners.
Why? Quite simply because Auckland Council has made it illegal to build homes beyond the Metropolitan Urban Boundary (which Papakura falls just within) and the Government has refused to overturn that policy despite promising to do so in their 2017 election campaign.
Until land is freed up around the perimeter of Auckland, house prices will remain amongst the most expensive in the world.