Key Takeaways:
- New Zealand is urged to follow through with its plans to build more houses in central areas to avoid a housing crisis like California’s
- The 2016 Unitary Plan in Auckland has increased housing supply and decreased rents, and similar changes are being enacted in other cities
- California’s housing crisis was caused by a lack of development in central areas, leading to a chronic undersupply of housing and skyrocketing prices
- Auckland’s inner suburbs are still locked off from development, but changes are being made to address the issue
- The importance of allowing growth in central areas cannot be overstated, as the alternative is a decline in community and increased poverty
Introduction to the Housing Crisis
A visiting urbanist from California, M Nolan Gray, is sharing a cautionary tale from his home state, warning New Zealand to avoid making the same mistakes that have led to a severe housing crisis in California. Gray, a US urban planner and author of Arbitrary Lines, is certain that the key to avoiding this crisis is to build more houses in central areas, rather than restricting development and allowing prices to skyrocket. He notes that while significant housing production can be painful, the alternative is much worse, and that New Zealand is on the right track with its plans to increase housing supply.
The California Experience
California is home to four of the worst housing crises in the US, with cities like Los Angeles, San Jose, and San Francisco experiencing extreme affordability problems. The root of the problem, according to Gray, is that these cities did not build enough houses for decades, leading to a chronic undersupply of housing and skyrocketing prices. This was often due to local residents and city councils banning development in large areas of the city, in an effort to preserve the status quo and avoid change. However, this approach has had devastating consequences, including locking people out of homeownership and leading to increased poverty and inequality.
Auckland’s Progress
Gray is impressed with the progress that Auckland has made in addressing its own housing crisis, particularly with the 2016 Unitary Plan, which has led to an explosion in townhouse construction and a decrease in rents. He notes that Auckland is nearly 10 years into a reform program that many parts of California are only just adopting, and that similar changes are being enacted in other cities like Christchurch and Wellington. Gray believes that there are serious conversations happening around housing in New Zealand, and that the country is on the right track to addressing the issue.
The Importance of Allowing Growth
Gray’s message is clear: allowing growth in central areas is crucial to avoiding a housing crisis. He notes that in California, suburbs close to city centers are declining in population, with old wealthy homeowners not feeling pressure to move, and schools being shuttered. This is also happening in Auckland’s inner suburbs, which remain locked off from development. However, changes are being made to address this issue, including Plan Change 120, which will enable apartments around train stations in Auckland’s center and inner west. Gray emphasizes that the importance of making these changes cannot be overstated, as the alternative is a decline in community and increased poverty.
The Consequences of Inaction
Gray warns that the consequences of not allowing growth in central areas are severe. In Los Angeles, for example, aging property owners in central suburbs have seen their home values skyrocket, but this has come at a cost. Their children have moved to cheaper states, taking their grandchildren with them, and it’s hard to find workers for local hospitals and supermarkets. Poverty has risen, and tent cities have sprung up nearby. Gray notes that this is what happens when cities fail to allow growth in areas where people want to live, and that New Zealand must avoid making the same mistakes.
Conclusion
In conclusion, Gray’s warning to New Zealand is clear: follow through with plans to build more houses in central areas, or risk facing a housing crisis like California’s. The 2016 Unitary Plan in Auckland has shown that increasing housing supply can decrease rents and improve affordability, and similar changes are being enacted in other cities. Gray’s experience in California has taught him the importance of allowing growth in central areas, and he urges New Zealand to learn from California’s mistakes and prioritize housing development in areas where people want to live. By doing so, New Zealand can avoid the devastating consequences of a housing crisis and create a more sustainable and equitable future for its citizens.