• The home ownership dream is dead. Victor Luca examines what went wrong

IT is generally acknowledged that New Zealand, like Australia and many other developed countries, is experiencing a housing supply and affordability crisis. That is on top of an infrastructure, health and energy crisis.

My father came to New Zealand via Australia as a migrant from Italy at the age of about 20 and established himself in Whakatāne in the 1950s.

He came with little ability to speak, read or write English.

Within a few years of arriving, he had established a restaurant business on The Strand, with his two brothers.

By the time he was 28, he and his brothers had enough cash to pay for the building of three well-appointed three-bedroom homes in town.

No mortgage and no crippling debt.

My mother and aunties were able to dedicate the first part of their lives to raising their kids.

I imagine this is a familiar scenario because my parents, like so many others of the baby boomer generation, lived in the post-World War II reformation period of super-abundance.

Home acquisition was the New Zealand dream, which we shared with America and Australia and other parts of the world.

We can now pronounce that dream well and truly dead. What went wrong?

There are three things that many consider fundamental human rights – education, health services and housing. These are part of the United Nations' 17 sustainable development goals.

These are key requirements for upward mobility.

Talk of housing crises probably date back several decades at least, but things have been quickly getting worse.

No longer can a young family aspire to building a new home or even getting into a modest home, even with both members of a couple in good jobs and working full-time. That is unless their baby boomer parents come to the rescue or leave some of that wealth when they pass. Rents, of course, are also astronomical.

My contention is that the causes of this housing tragedy are systemic policy failures on the part of governments of all flavours.

Some of the factors for plummeting affordability that I highlighted in my July 2020 column on this subject include:

• Historically low interest rates
• Sale of New Zealand properties to foreign non-residents
• An over-zealous immigration programme
• Lack of available housing and land

I suspect that in Whakatāne, the lack of available land and housing is particularly marked.

Many older folk who may have money are struggling to get out of large homes and move into a retirement village setting because there are no retirement villages in our township.

Our Government has absolute faith in the market and talks about reducing regulations as part of the solution to the housing crisis. It talks about building 27-square-metre apartments without balconies as another part of the solution.

Our 41-year-old housing minister, who used to be a tobacco lobbyist, stated at the Local Government New Zealand conference that he wouldn’t like to live in one of those apartments now that he has a family, but as a student that would have been fine.

I would love to have reminded the minister that only students with rich parents could afford to rent or buy even such a tiny apartment, as well as pay tuition fees.

At $4000 per cubic metre, such an apartment would still cost $108,000.

What student can afford to add that to their already crippling student debt? Get real, minister.

When it comes to determining housing availability and prices, Government policy is critical. Government sets the rules of the game.

Kevin Bell, an adjunct professor at Monash University, and also a former Justice on the Supreme Court of Victoria, was interviewed recently on Bloomberg Australia. He makes his case very well.

He says that “Government has withdrawn so far from housing as a policy priority that the system has failed due to under-investment and under-care.

“Social housing, which should be accessible to those without capacity to pay or rent on the private market, has been run down for a very long time. Two people on good jobs can’t afford to buy a home anywhere near the population centres.”

Sounds like us here, doesn’t it?

In terms of social housing in Whakatāne, Kainga Ora (Housing New Zealand) owns about 500 properties on which, typically, exist small dwellings.

Due to cuts to Kainga Ora’s build programme, the initially intended dense social housing on about 150 of those properties will be dramatically reduced.

Many projects are in doubt. And if densification is part of the answer, then we clearly need to look toward vertical living. In other words, multi-storey apartments.

Of course, we in local government also have a role to play in expediting new housing since we develop and enforce the district plan.

It is in fact a statutory role of local government to make land available for residential and commercial use.

However, planning approvals can be slow, especially when consultation is required, and existing residents resist new developments in their backyards.

It is obvious that if housing development doesn’t keep pace with the influx of people, then there is a problem.

Without housing, industries that require additional staff are held back.

Interestingly, according to the 2018 census, of the 14,190 houses in our district, 810 had no one living in them. Auckland is replete with ghost houses (an estimated 40,000).

The spatial plan

I’ve mentioned the shortage of land availability in Whakatāne.

For the past four years or so, the council has been developing a spatial plan and actively working on it for two-and-a-half years now.

It has involved Kawerau District Council and the Bay of Plenty Regional Council, while Ōpōtiki District has more lately joined the process.

A spatial plan is essentially a multi-dimensional map that helps determine where things like housing and infrastructure should go.

The dimensions of this plan might include landform and land quality, hazard zones, current infrastructure location (transport, water and electrical) and so on.

A spatial plan should take into account climate change mitigation and adaptation, as well as sustainability.

Consideration of adaption also suggests that future impacts upon infrastructure need to be carefully considered.  Geographical constraints are also a consideration in our district.

Anyone who has played the popular computer game SimCity will have an idea of what all this is about. The game has 40 million players world-wide.

That the planning landscape has to take into account natural hazards is demonstrated by the 2005 debris flow in Matatā that saw 34 properties compulsorily purchased in a process termed "managed retreat". It took eight years to complete and was deeply distressing for some residents.

As climate change exacerbates extreme weather, it is important that planning judiciously considers what may happen in the future in places likely to be impacted by sea level rise, more frequent flooding, and other effects.

If climate change is going to provoke more severe storm surges in the future, then building on the coast is probably not a smart thing to be doing.

Properly defining the flood zone in the township itself would also place constraints on the types of structures that should be built if we are to be better prepared for future extreme weather events.

We can either adapt through engineering by, say, building higher stop banks, or retreat from the flood zone. The 1960s home I live in is about 800 millimetres off ground level for a reason. That is because back in the day folk better appreciated that we were building on a river flood plain.

The Our Places – Eastern Bay of Plenty Spatial Plan is due to be completed by August 2025 and it goes out to consultation before Christmas.

So, get ready to hear more about spatial planning from the council and me. You can also always contact a councillor to discuss this.

It has taken way longer than I wanted to get to this point and I am glad that we are finally seeing the light at the end of the tunnel.

The mayor of Rotorua Lakes Council, Tania Tapsell, has done a good job of explaining spatial planning in a short video entitled, What is a Spatial Plan?  It’s well worth a Google.

-Victor Luca