Affordable housing Bill could make development easier
An affordable housing Bill empowering local councils to promote affordable housing development is being prepared.
Saturday, October 20th 2007, 12:00AM
by The Landlord
Housing Minister Chris Carter says it may provide for councils permitting more intensive development than otherwise allowed and/or waiving development contributions and levies.
The Real Estate Institute welcomed suggestions that the government would enable councils to reward developers who provide affordable housing.
REINZ president Murray Cleland says, “Providing incentives to residential property developers to build affordable housing is likely to be more productive than attempting to compel them to include such housing within planned developments.
“It’s also encouraging to see the minister acknowledge “it is important to balance the need to increase the supply of affordable housing without deterring private development”. That signals a significant departure from earlier suggestions that the government intended to compel property developers to include affordable housing components within residential developments.”
REINZ argues that compulsion could well make the problem worse by deterring developers from undertaking residential property market, thereby limiting supply and further fuelling house prices. It favours introducing policies that enable trade-offs for building affordable housing by waiving development contributions or urban density limits.
”Compulsion would add another layer of bureaucracy and cost when what is needed is to reduce the cost structure of subdivisions for affordable homes,” Cleland says.
“The major obstacle to low cost housing is local authority-imposed costs in the form of high rates and building consent and approval costs. The other key factor is local authorities’ reluctance to re-zone land for housing, which inflates land values and creates a barrier to entry for low cost housing for both purchasers and developers alike.”
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