Housing: New Alliances, New Battlefields
Housing has been rising as a political and social concern in New Zealand. As public concern about housing issues has risen, the nature of how the public views planning has changed from prioritising aesthetic considerations to addressing social needs. This has altered the political lines of battle as alliances reform and the debate extends to new fields.
Rhetoric from parties right across the political spectrum have prioritised housing. On the Left, housing is now regularly ranked up with education and healthcare as their main area of focus. While the Right have in the past campaigned that affordable housing is important to them and they want a home ownership democracy. Yet both the left and the right have historically supported other goals in the planning system - increasing the cost of leafy suburbia properties by restricting change and directing urban areas to become compact cities.
So it is interesting in recent weeks, that all the major political parties are now supporting National Policy Statements to guide Councils on how to develop their cities to be affordable for their residents. National Policy Statements are instruments used by the government to instruct Councils and the Environmental Court on how certain nationally important aspects of the RMA will be applied. This indicates that housing affordability is now of national significance. I think it is worthwhile looking at what is driving this intervention.
A useful way of examining this situation is to look at the conceptual goals of what is wanted from a city.
For many years now in New Zealand, city planning has focused on achieving aesthetic goals, such as protecting suburban character - streets of traditional villas from change or achieving a compact city - dense European type cities.
To achieve the aesthetic goals, rigid structural interventions were necessary - strict rules preventing property owners from building too high and too densely in existing suburban areas. As well as strict rules preventing new residential housing being built outside urban growth boundaries.
In my view, aesthetic planning approaches have several problems. The first being, which aesthetic goal to target - preserving existing leafy suburbs or achieving a compact city? In Auckland for instance, there is a logjam of arguments between these goals and the communities which campaign for them.
It is the second problem which I want to concentrate on though, as I think it is the major critique of aesthetic based planning. Many people are now querying if aesthetics should be the highest goal in planning or if there should be other goals with higher priority, which I will label 'needs orientated planning'.
Hugh Pavletich was the first to challenge aesthetic based planning in New Zealand. Hugh is retired now, but he has a background in property development in Christchurch and the South Island. He became frustrated as he watched all the rigid rules on what could be built where, driving up land and therefore building costs. Hugh started the annual Demographia survey with an American colleague which measures housing affordability in many New Zealand and international cities. This introduced the idea that cities should prioritise affordable housing targets - such as, comparing median household income with median house prices - not some aesthetic goal.
Hugh made some progress raising the profile of affordable housing with the public, but was largely ignored at the local and central government level. This was despite his message targeting the incoming National government of 2008, especially in its ideology - being that new urban development should be market-led not planning-led.
From a left wing perspective what Hugh was saying did not resonate, especially because he quickly went from highlighting a social problem, to advocating for “Houston”, as the appropriate development model to copy. Houston being a city that is very affordable, even when exposed to high immigration demand, but it is also an extremely dispersed city which is completely dependent on private vehicles and a massive motorway network.
The second major challenge to aesthetic based planning was the speaking tour of New Zealand by urbanist and former Chief Planner of the World Bank, Alain Bertaud, in 2014. He added academic rigour to Hugh’s argument and also balance. Alain recommended the market-led supply solution should be both up and out. Alain showed on density graphs that compared to similar cities, Auckland was lacking density in its inner suburbs and that overall Auckland density was closer to European cities such as Berlin and Stockholm rather than US cities of Atlanta or Houston. He was neutral regarding transport mode as long as it met mobility requirements.
Alain Bertaud is from the NYU Stern Urbanisation Project, which promotes a planning concept known as Making Room. This states it is the responsibility of a government entity to purchase and set aside land corridors for major trunk infrastructure and amenities such as parks before development occurs, because it becomes practically difficult to retrofit this infrastructure afterwards. And further, that the land area adjacent to these corridors needs to be large enough to ensure there is competitive land supply to achieve stable land prices and affordable housing. In New Zealand, the government entities responsible for major trunk infrastructure are a combination of local and central government agencies. Ideologically, Alain promotes the classic mixed economy of the government and private sector each having an important role to play in supporting society.
With regard to public support what Alain Bertaud was saying was much more centrist in its political appeal.
The third major challenge to aesthetic based planning, was the return of economic interest in how property markets function. In particular, Shamubeel and Selena Eaqub -a husband and wife team of economists who authored Generation Rent which was published in 2015.
This added further academic rigour to Hugh and Alain’s work. The Eaqub’s gave a detailed description of the economics of declining housing affordability and homeownership rates, which was consistent with Hugh and Alain’s arguments. They showed that there were European models of affordable housing cities - in Germany for instance.
The Eaqub’s proposed a broad framework of policy prescriptions that would help remedy the housing crisis. From palliative care options of building more state housing and improving rental conditions, to addressing cyclical demand issues such as the Reserve Bank Macro-prudential tools and addressing high rates of immigration and foreign buyers. Most importantly, fixing the structural problems which Hugh Pavletich and Alain Bertaud had already highlighted.
John Campbell interviews Shamubeel Eaqub - Jan 2016
The important thing the Eaqubs did in their book was discuss the social, cultural and moral dimensions of unaffordable housing. So the issue of affordable housing was placed in a moral framework. They raised the possibility that as a society New Zealand is dividing into a generation rent class and a landed gentry class - a patrimonial society where the path to homeownership is through gifts, assistance and inheritance. This is a cultural change from our 'fair go, jack is as good as his master, bet on the underdog' kiwi value system. The Eaqub’s further argued that ultimately housing related social problems will be solved in the political arena by political will.
Obviously the Eaqub's message has a lot of appeal for the left, meaning that both left and right wing parties are being called on to prioritise a needs based planning system.
Addressing affordable housing brings together the progressive sides of the political right and left to serve the generation rent class - in particular those on median to low incomes who will not be gifted or inherit family assistance. It has created unusual alliances. When the fog of political war clears, in my opinion, it will become apparent that the battle for affordable housing is the defining issue of our time. In essence it is about who benefits and who pays in New Zealand and what sort of people kiwis are becoming.
