Housing Affordability

Here’s an interesting excerpt from Brooke van Velden's article on Housing Affordability. It makes total sense to me. It’s only more supply that will curb house price inflation and rental increases, not more regulation.

Will this government learn from other countries? I doubt it. They’ll make the same mistakes and blame the same people. They’ll increase taxes on anyone who is making a decent living and house prices will keep rising.

“Yet, for every tax or price freeze suggested to solve the problem, there's a real-life example of it not working.

Take South Korea. They've tried over 20 initiatives to curb soaring house prices ranging from price ceilings to 70 per cent property taxes and yet prices kept rising. The initiatives fail because demand continuously outstrips supply. Tinkering doesn't build more houses. President Moon Jae-in has recently signalled supply-side reform”

I also agree with this:

“It takes forever to get consent for anything larger than a garden shed let alone a whole development, but the councils aren't entirely at fault. They're just playing by the Government's rules, which are skewed against development. We need to replace the Resource Management Act (1991) with urban planning laws that recognise the challenges of 2021”.

I’m still working through my consent for 22 units in Hamilton.

We had the pre-application meeting 16 months ago, and now I’m required to get an Ecological Assessment, for the first time ever, apparently it’s becoming a more common requirement.

This is what an Ecological Assessment entails:

? Site visit by Ecologically qualified consultants

? Assessment of the current ecological values of the subject site area

? Review development proposal

? Assessment of effects of the proposal on ecological values. Including any short-term effects during construction, or long term effects (for example effects of habitat loss etc). – this may include impacts on not just vegetation but fauna such as birds, bats and lizards

? Review of proposal against relevant Council planning criteria

? Make recommendations to avoid, remedy and mitigate any adverse effects.

? Preparation of ecologist report

? Liaison with other relevant specialists – e.g. planner, arborist, design engineer etc as required.

This will take months and cost many thousands of dollars. Why it’s necessary for a site in the middle of Dinsdale in Hamilton City (not greenfield) I don’t understand, but there isn’t anything I can do about it. If I want the consent I need to keep jumping through hoops until I get it, unlike Fletcher Building (20% NZ Owned) who are large enough to get government fast track approval to development on what is currently rural land.

Bottom line is keep investing in property. The cost of new homes will continue to rise with increased regulation and resulting consent times, not to mention the rising cost of labour and materials. This will drag up the value of existing property.

John Kenel

Assured Property

#assuredproperty #housing #rentals #propertyinvestment