New homes getting bigger

THE SIZE and value of new homes being built has spiked again leading to one affordable property campaigner saying the market is bypassing most middle and low income New Zealanders.

Auckland appears to be leading the charge towards increasingly large new homes, according to figures for new consents which came out last week from Statistics New Zealand.

Affordable housing has now become a major policy platform for both the National Government and the Labour opposition, though the two parties’ policies to lift the new-build rate for more

The average value of building works per dwelling has risen to just shy of $300,000.

affordable properties couldn’t be more different.

The figures for consents for new dwellings in the year to the end of November show the average value of building works per dwelling, a statistic which does not include the cost of the land on which the dwelling is to be built, has risen to just shy of $300,000.

Add in land costs and a large proportion of the homes being built are beyond the means of low and middle income earners, especially in Auckland which was responsible for 27 per cent of new dwelling consents in the year to the end of November.

In Auckland the average for the 11 months to the end of November was just under $320,000, which if maintained in the December figures would be a new record.

Strip Auckland, which is adding new homes far more slowly than its population grows, out of the figures and it reveals that the year to the end of November average value of a dwelling consent was $287,664.

The national average squaremetre of builds also continues to rise, indicating building is catering to buyers able to afford larger, more luxurious homes.

Though figures for Auckland floorplans for 2011 and 2012 were not available when this article was prepared, it seems likely floorplans have headed back to 2007 levels as they have nationally.

Hugh Pavelich, who has been long campaigning for Government policies to free land use to fuel a building boom and bring down house prices, said average New Zealanders have been ‘‘knocked right out’’ of the new home market.

Pavelich said that, in Auckland especially, the new-builds were catering to higher income earners.

He blames the cost of land as the main factor behind the dearth of new builds for ordinary and poorer families in Auckland, but to a lesser extent in other cities, and part of the cost problem were local authority restrictions on land use, though he did not spare criticism of council consenting processes which he says is slow and costly, and which he was convinced would be fixed by Government intervention later this year.

Pavelich said high density housing was not going up because the market did not want it.

‘‘People just don’t want to be bringing up kids nine floors up in an apartment,’’ he said.

Pavelich, himself a property developer in Christchurch, said the problem was not a reluctance of banks to lend for new builds – something that has played a part in house price falls in countries such as Britain where there is also a housing shortage.

But he is hopeful that the consents figures will begin to change as early as late this year thanks to Government policy which appears to be heading to ease local authority restrictions on building on land around cities like Auckland.

Critics, however, fear such a change would lead to sprawling, inefficient cities.

By contrast, Labour’s policy is to invest a billion and a half dollars in a programme that will build 100,000 lower-cost homes over 10 years. This plan was dubbed ‘‘fantasyland’’ by Prime Minister John Key.