Alternative facts virus hits housing

Govt’s answer to failure to conquer city’s rising crisis? Friendlier data

The “alternative facts” virus is spreading as fast as a speeding bullet. One short phone call with the highly infectious US President Donald Trump was enough to lay Prime Minister Bill English low. And already he’s spread it to his close colleague, Nick Smith.

Having spectacularly failed to conquer Auckland’s burgeoning housing crisis over the past eight years, both English and Smith are now implying it’s all a beat-up.

Rejecting a recently released Treasury paper estimating the housing shortage in New Zealand had reached 60,000 and was growing by 40 houses a day, the Government is now presenting an alternative fact, that the national housing shortfall is a mere 10,000-20,000.

Smith said yesterday the figures came from his officials, and when questioned on the discrepancy, said: “It’s a very difficult number to estimate.”

Any estimate is “crude” he told Morning Report, “because the most important assumption” is about how many people are in each household.

He came up with this on the day the High Court gave the green light to the new Auckland Unitary Plan which provides for 400,000 new homes in Auckland over the next 23 years.

This plan, and the increased capacity for new houses, was strongly pushed by Smith and his government colleagues based on “crude” estimates of housing needs he now seems to be rejecting.

The Government’s 2012 Housing Accord with Auckland Council was based on a jointly agreed existing shortfall of 20,000-30,000 houses plus an ongoing need for an annual increase of 13,000 for 30 years.

This figure was matched by the Productivity Commission in its July 2015 report warning “Auckland has an existing shortfall of as many as 32,000 dwellings and requires a

What’s the Government’s answer? To fiddle with the figures.

further 13,000 dwellings a year to accommodate new growth”.

Shortly afterwards, Auckland Council’s Housing Project Office estimated a more modest existing shortfall of 15,000 homes, which would rise to 25,000 in 2018. This was based on building consents rising to 11,000-12,000 a year — which they haven’t.

In July last year, Reserve Bank deputy governor Grant Spencer echoed these figures, painting a glum picture to the Institute of Valuers.

“We estimate the shortage of houses in Auckland has increased over the past year and may now be in the order of 20,000-30,000 houses [and] expected to increase further.”

When you add into the formula that Auckland’s population has increased by about 90,000 in the past two years alone, the Government’s new housing shortage figure of 10,000-20,000 nationwide is risible. As is Smith’s latest suggestion that the solution to the housing crisis lies in household size. What’s he hinting at?

That he’s about to force the good National-voting burghers of Remuera to open their spare bedrooms in their half-empty mansions and pool houses to the huddled masses sleeping in cars and motel units? That if we got Auckland’s bedrooms sorted out, all would be right with the world?

A nice thought, perhaps, but hardly a vote-winner in the upcoming elections.

For we viewers of Newshub live, issues took a bizarre twist when political editor Paddy Gower popped up to announce breathlessly that “69,000 houses [are] to be built in Auckland over 10 years. A much bigger figure than has ever been made public by the Government before”.

He said they would be half state rentals, the rest for sale.

It was nice fantasy while it lasted, and, I thought, a smart political U-turn, stealing Labour’s thunder. Labour has a long-standing policy to build 10,000 affordable houses a year for 10 years, nationwide for both rental and for firsthome buyers.

But Smith quickly hosed this “scoop” down.

While the recent High Court decision allowed Housing New Zealand to intensify the use of its existing land in Auckland, permitting up to 69,000 homes on land now holding 27,000, he said: “It doesn’t automatically mean it’s taken up.” What a shame.

Last September, the International Monetary Fund put New Zealand at the top for housing unaffordability in relation to how much we earned compared with 30 other rich countries. We also topped a list of 64 countries for house price growth in the past year.

What’s the Government’s answer? To fiddle with the figures.