Graeme Wheeler should sick to monetary policy

Graeme Wheeler should sick to monetary policy because he clearly knows nothing about property and how cities are built.

I don’t want to repeat like a broken record the things I have said before on this site, but suffice to say Wheeler’s view that NIMBY’s are to blame is just dumb.

Building height restrictions and NIMBY attitudes in inner Auckland are standing in the way of an adequate supply-side response to Auckland’s housing shortage, Reserve Bank governor Graeme Wheeler suggested today.

Appearing before Parliament’s finance and expenditure select committee he reiterated the bank’s estimate that the backlog of unsatisfied demand in the city is between 15,000 and 20,000 houses.

While dwelling permits issuance had risen to an annual rate of around 7500 — “a huge improvement” — that was still well short of the 10,000 a year over the next 30 years the Auckland Council had estimated the city needed, let alone eating into the backlog, he said.

“Some very good work has been done on opening up new areas but a major challenge there is getting the houses built quickly enough and a lot of those areas are in the periphery of Auckland where people may decide the transport costs make it less attractive for them or the infrastructure needs might be considerable,” he said.

“I think work needs to be done in inner Auckland in addressing the height restrictions and the not-in-my-back-yard syndrome that’s there.”

Most of NIMBY reaction is absurd – yes. But it is closely linked to the fear that intensification means big apartment buildings will be constructed in their neighbourhoods. That’s partly because Auckland Council has done a piss poor job of selling what bulk and scale would be possible in each zone.

The chances of big scale buildings popping up all over Auckland is reasonably low. The Productivity Commission clearly indentured that reason why – that almost all of our construction and development industry is a ‘cottage industry’ made up of sole traders and small businesses who turn over very few dwellings a year.

The number of developers undertaking big large scale buildings is tiny.

Creating scale requires big capital. Nobody has that let alone the motivation to take such big risks. Nor do the banks want to find those sorts of projects in scale.

Both Wheeler and NIMBY’s are wrong about what would or should or could be built.

Wheeler is dumb because if he thinks apartment buildings and intensification are the answer he shows he doesn’t actually know who builds our cities.

And that is before we cover the issues of infrastructure and just how do you make a city change when it is already densely packed with houses of some considerable value.

Really?! Is this the best he can muster?


– NZ Herald