Barrier to building

Stuart Froude (Letters, Feb 24) needs to consider another factor – the most important one – about why new houses were affordable in the 1950s and 60s.

Yes, there were efficient cooperating ‘‘teams’’ building homes at economic-scale quantities – indeed, whole new suburbs at a time.

But the crucial problem is the land price. The whole new house was once 4.5 times the average income – of single earners – but now the land alone, for an equivalent section package, costs much more than that.

Hugh Pavletich, who has been advocating reforms since 2004, has a saying: ‘‘Get the land wrong and everything else will be wrong.’’ And indeed, scale economies are lost; construction workers; remuneration is squeezed; development becomes high-risk with more firms going bust; supply of building materials becomes uncompetitive.

There is one single factor that correlates with a market ‘‘flipping’’ from affordable to unaffordable in all historical examples: urban planners rationing the land supply which then becomes a classic priceextractive monopoly.

Subsequently, every plausible new measure that is meant to be a ‘‘solution’’ – building smaller, building ‘‘up’’, building cheaper, bureaucratically negotiated ‘‘scale’’, innovative financing – merely enables another land price gouge which more than negates the ‘‘progress’’. PHIL HAYWARD Naenae