It's more like an RMA 2.0

"The Resource Management Act has been amended virtually every year since 1991 and reviewed several times during that period. Yet reform has consistently failed. [See here for reams of examples]

"The RMA ... [has] delivered a housing crisis, $1.3 billion a year in infrastructure consenting costs, 1,175 different zoning categories, and declines in freshwater quality and indigenous biodiversity – the environmental outcomes most directly within the planning system’s control.

"So when the Government set out its ten principles for replacing the RMA in late 2024, there was genuine reason [among some people] for optimism. The Cabinet paper was clear: the new system’s starting point would be the enjoyment of property rights and respect for the rule of law. The scope of what could be regulated would be narrowed. Nationally standardised zones would replace the bewildering patchwork of local rules. Environmental limits would be based on quantitative data and not be overly prescriptive. Consenting would be drastically reduced. ...

"But legislation lives in its detail. And in the detail, something has gone wrong. ...

"Consider property rights. The 2024 Cabinet paper said respect for property rights should be the default position under the new system. But neither Bill mentions property rights as a purpose or among its goals. They are only alluded to in limited circumstances. .... Without safeguards in the legislation, property rights are little more than a pious aspiration.

"Some will say, ‘so what’? The international evidence on institutional foundations of prosperity, recognised by the 2024 Nobel Prize in Economics, is unambiguous: secure property rights and constrained state discretion are preconditions for sustained economic development. As for the environment, the Soviet Union had no respect for property rights. Its environmental record was quite literally disastrous. ...

"The Bills confer far too much power on ministers. They will set national policy directions, national standards, standardised zones, and environmental limits. It might be 2029 before all this is in place. Parliament does not know what those decisions will be. It is being asked to build the frame of a house without knowing its floor plan....

"Clarity is further undermined by undefined terms like “inappropriate development” and “not unreasonably affect others”. These terms sit at the top of the hierarchy. Litigation over their meaning under a new framework is likely here too.

"The Bills are currently before the Environment select committee. It can recommend some principled amendments to align the Bills more with Cabinet’s intentions. One could incorporate Cabinet’s explicit and central instruction to protect people’s ability to enjoy their property. ... clearly defined terms should replace the subjective language in their goals.

"The select committee has an important opportunity to put this right [or at least try to make a pork chop out of a pig's ear - Ed.]. It should take it."

~ Nick Clark from his op-ed 'The RMA reform we were promised is not the reform we got' [Emphasis mine.]

The Minister for Epsom speaks

...

...

 

 "Depressing to see ACT—once upon a time at least ostensibly a pro-market party—apparently opposed to freeing up land use, and enabling urban land prices to fall a lot."

    ~ Michael Reddell

Why don't you live where we tell you to?

"So many suggestions come down to 'what if instead of allowing housing where there is demand for housing, we tried to make people live somewhere else,' and I feel like the downside of that approach is pretty obvious."

~ Matt Yglesias

"However much it offended the sensibilities of design snobs and planners, we were there because our shoebox apartment was better than the alternative."

"[I]n 2005, Auckland city was ... dotted with cranes, many standing up so-called 'shoebox apartments.'
   "The phrase was not meant as a compliment. They were derided as 'future slums' ... [which] ultimately led to a rule change ... making the minimum size of a two-bedroom apartment 70 square metres. ... [T]he change had a profound and lasting impact on apartment construction. ...

Chart by Apracitis Economics, from The Spinoff

"In 2005, I was only dimly aware of the furore, of the disgust shoebox apartments aroused. In 2005, I was living in one. ... In retrospect that apartment was where I started to get my shit together, started to have a sense that I could be something more than a fuckup....
    "The apartments were objectively ugly, though not so bad as they were made out at the time.
    "But the upside overwhelmed all that. I was right there in the city. ... It was what I needed at that time, however much it offended the sensibilities of design snobs and planners. I feel confident in saying many other residents, transient as we often were, felt the same way. We were there because it was better than the alternative. ...
    "Another characteristic of the inner city when I lived there was that homelessness barely existed. I remember vividly an extraordinary double-page feature in the 'NZ Herald' which looked at life among the unhoused then. It mapped specific characters, and if you spent a lot of time in the inner city, it seemed a near-complete survey.
    "The idea that you could now map the scale of human misery that a lack of housing has brought to Auckland is unimaginable. As the ’00s wore on, the GFC hit and the next decade began, the city acquired its current reality, with hundreds of people making lives on the streets of downtown and its fringes. It’s now a countrywide phenomenon.
    "That’s the backdrop of the reforms announced last week by housing minister Chris Bishop. I travelled into the city to see him deliver a speech about housing last week ... He spent long periods wading through the thickets of regulation, through the acronym soup of the MDRS and the NPS-UD, and paid compliments to Auckland’s groundbreaking 2016 unitary plan, which started the process of unshackling land for development and finally saw us surpass the heady mid-00s for construction of multi-units.
    "But the part which leapt out for me was not technical, it was moral. He announced an override of the minimum dwelling size standards – a return to plausibility for the kind of place I lived in 20 years ago. In front of a room full of people involved in construction and leasing, with tables for Colliers and CBRE and Crockers, he made a simple case. 'You know what is smaller than a shoebox apartment? A car or an emergency housing motel room.' That’s our current plan for dealing with people who don’t have a house, and it’s indefensible.
    "The rest of the reforms he announced are big. They are a continuation of an enormous body of work which started with Auckland’s unitary plan, was driven forward by Phil Twyford’s revolutionary NPS-UD which created a huge potential for urban density, and now reaches a powerful climax with Bishop’s 'Going for Housing Growth' package.
    "It’s not beyond criticism ... But to me those issues are less material, and likely to be less impactful, due to the return of the maligned shoebox."

~ Duncan Grieve from his post 'I lived in a shoebox apartment. I’m glad they’re coming back'

'Sudden housing intensification' is simply a by-product of past mistakes

Pic by Andrew Price for Strong Towns

"If we'd had super liberal residential zoning since 1925, the market would have naturally led to 'incremental intensification.' 

    "In other words, 'sudden intensification' is a by-product of past mistakes with strict zoning. We should fix those mistakes ASAP."

~ Stephen Hoskins

"...*if* Mr Bishop delivers on his promise."

"Far too many New Zealanders already suffer from serious financial stress because of the ridiculous price of houses. The problem is only going to get worse unless the Government delivers on the promise made by the Minister of Housing, Chris Bishop, who, in a major speech near the end of February, said the Government is aiming to get house prices back to where the median house price is between three and five times the median household income. To protect himself from the anger of thousands of property-owning voters, he did say that that was his ambition over the next 'ten to twenty years,' but if he is at all serious New Zealanders better get used to the idea that house prices will not be rising steadily year after year into the indefinite future.
    "Increasingly, as houses get older and in need of repair, and if the market is working as it should do, they will sell for less than they cost to buy.
    "But what about the land they sit on? Surely that won’t decline in value? Certainly there will always be land which has special appeal: that will quite likely rise in value faster than other prices and faster than incomes. But given New Zealand has a great abundance of land, section prices should be nowhere near where they are currently in most of our cities. That implies that section prices are likely to stagnate or decline from present levels if Mr Bishop delivers on his promise. [Yes, "if" - Ed.]
    "In an earlier article I quoted the case of a 455 square-metre bare section on sale in Drury – nearly 40 kilometres from downtown Auckland – for $842,000 including GST, or $1,850 per square metre. This is more than 10 times the average price per square-metre of sections in the US. This difference is caused primarily by the tight restrictions imposed by local governments on where houses are allowed to be built.
    "Those who demand that housing be confined within tightly prescribed urban boundaries – as is true in all our major cities – must be told again and again that they and they alone are primarily responsible for the appalling social costs arising from the outrageous price of housing in New Zealand’s major cities."

~ former Reserve Bank governor Don Brash from his post 'Perhaps house prices don’t always go up'

HOUSING: "What regulation has ruined, deregulation can repair."

"Government regulation has raised housing prices far above the physical cost of land and construction.
    "And what regulation has ruined, deregulation can repair.
    "It's tempting to look at America's [and New Zealand's!] most expensive addresses and repeat the top three principles of real estate: 'location, location, location.' But this glosses over the artificiality of today's locational scarcity. Since the dawn of the skyscraper [or even just of the Georgian terrace house or Manhattan brownstone], technology has allowed vast populations to simultaneously enjoy the world's top locations. The government response, in turn, has been to make building skyscrapers [or terrace houses] in desirable places nearly legally impossible.
    "Indeed, U.S. [and New Zealand] regulators view almost all multifamily housing with deep suspicion. That's why they zone a supermajority of residential land for single-family homes. [See Auckland council for example.] But even the single-family supply is heavily restricted, because governments routinely set high minimum lot sizes to force builders to waste most of their land. Physically fitting six mansions on an acre is easy, but legally you're lucky [in some areas] to get a green light for one.
    "Averaging over the whole U.S., a conservative estimate is that regulation has doubled the price of housing. [No reason to think it's any less here — and given the outrageous price of building materials here, is more likely much more!] It's much worse in places like the Bay Area and Manhattan, and a minor issue in the countryside. But as a recent paper by Gyourko and Krimmel shows, regulation raises prices almost everywhere that lots of people actually want to reside.... As a matter of arithmetic, then, halving the price of housing would [at minimum] cut the cost of living by 10%, raising the standard of living by 11%. (As you may recall, 1.0/.9≈1.11).

    "Even better, deregulation will deliver these gains beyond a reasonable doubt. Laissez-faire in housing is not a futurist Libertopia. A hundred years ago, U.S. housing markets were close to laissez-faire [as they were here in NZ before the first Town Planning Act in 1928], and the least-regulated regions of the U.S. are still close to laissez-faire. Furthermore, we don't have to blithely assume vigorous competition will arise, because vigorous competition in the construction industry already exists. The total number of builders is immense, and even in our regulated world, many are champing at the bit to expand.
    "Indeed, the construction industry could revolutionise our lives for the better if it simply were free to deploy the technology of a century ago! Work on the Empire State Building started in 1930, and was complete just 410 days later. [Likewise, work on Auckland's Grafton Bridge, the longest reinforced concrete-arch span in the world at the time, started in 1908 and was completed just over a year later!] Imagine what industry would accomplish if we combined the light regulation of the past with the advanced technology of the present.
    "Almost all political thinkers like to keep up with the news cycle — to talk about the latest, most salacious topics. I've indulged this temptation myself more than once. But if your worldview has merit, you can do so much better than opine on the scandal of the century of the week. Housing deregulation realistically promises to enrich humanity by trillions of dollars. And all government has to do to make this happen is stop preventing it."

~ Bryan Caplan, from his article 'Trillions' — promoting his new 'graphic novel' Build, Baby, Build

"You're free to build, but ..."

 

The National-led Coalition boasts that it will "fix housing" by bringing in rules requiring councils to zone enough land* on which land-owners are free to build sufficient housing to allow for the next thirty years of demand.**

Doesn't that sound great, you think. "Free to build," you say! 

The National-led coalition's housing honchos are either stupid, naive, or they think that we are.

As should have been obvious from Auckland council's passive-aggressive resistance to government diktats on the Medium-Density Residential Standards (MDRS), telling councils to "free up land" only works if councils are so inclined. If they are already so inclined, ministers wouldn't need to tell them. And if they aren't so inclined then, well, as Bryan Caplan points out in his new "graphic novel" Build, Baby, Build: The Science and Ethics of Housing Regulation, councils can hinder construction in dozens of other ways ... if it's so inclined. (And it is.)

For starters it could ...

Go tell Minister Bishop. (Or send him a copy of Bryan's book.)

* * * * 

* Zoning is a restriction on land telling owners that the planners know better than the owner (and would-be buyers) what should go there. How is it a restriction, you ask? If the planners' zone allows what the owner would do anyway, it's not needed. If it disallows it, it's not wanted.

** This presumes that the grey ones would even know, to any standard of meaningful proof, what demand would look like over the next thirty years. I mean, it's not like there's any thirty-year stretch in recent history they could point to and say "look, we got it right."

"The RMA’s starting position is that you need permission. It is going to be dumped." But ...

"Did you know it costs 50% more to build a house here than it does in Australia? ...
    "We [sic] have successfully regulated our housing market so tightly that only the children of existing homeowners can obtain the financing to purchase property. We [sic] have created a landed gentry. ...
    "There are two reasons for this; land use restrictions and building regulations.
    "Let’s start with land use. The Resource Management Act, or RMA, began life in 1991 as a blueprint for preventing Kiwis doing anything with their land unless it complied with a national environmental plan and had the consent of the local council. ...
     Again. ...
    "Simon Court, the Act MP and Undersecretary with the responsibility for drafting the replacement, has a different outlook. You can do whatever you want with your land, so long as it does not interfere with someone else’s property or rights. [Not true. See below.* - Ed.]
    "[But] this reform is 18 months away and will be in place for less than a year before the next election. ... National and Act have had six years to draft their RMA replacement. [And they haven't. - Ed.]
    "There are plenty of interested parties who would have contributed to this effort and a bill should have been ready to present to a select committee in the first hundred days. [Yes, it damn well should have been. - Ed.]
    "The longer any RMA replacement has to gain acceptance the more durability it will enjoy upon a return to a Labour-led government, and Labour have their RMA bill already drafted and ready to go; that being the one Court and his mates deleted on Christmas Eve. [Not to mention the not-insignificant regime uncertainty in the market until the replacement Act filters down to council's 'planners.' - Ed.]

~ Damien Grant, from his over-optimistic column 'Housing market so tightly regulated we’ve created landed gentry'

* Court's most-developed explanation of his proposed 'Urban Development Act' begins this way:

"Under ACT’s Urban Development Act, limits for urban development would continue to be based on locally-decided [council] plans."

So rather than a plethora of sackings of the unproductive, Court — a 'planner' himself by profession — proposes instead to keep his colleagues planners hard at work.

"These plans [his 'reform' plan continues] have democratic mandates [sic] and protect the legitimate expectations of property owners, while allowing councils to plan for infrastructure delivery."

Translation: Our party's two leading MPs represent home-owners in the country's leafiest suburbs, pledged to protect the unreasonable expectations of those suburbs' home-owners about what can be built next door.

"Councils [says Court] will not be permitted to restrict housing density more than the Auckland Mixed Housing Suburban zone."

Auckland's MHS "zone," by the way, essentially mandates for more of the same tightly restricted suburbia. And this confirms that zoning will still be with us, as well as planners. (How this reflects, as Grant says, 'doing what you want on your land as long as it doesn't affect someone else's property right,' Court alone knows. I suggest they both read Bernard Siegan.) 

"These zoning rules [Court says] have already been validated [sic] through extensive litigation in the Environmental Court ..."

One would have expected to see the back of that meddling court damned soon. Sadly, it seems however, we have a Court who refuses to meddle enough in his 'reforms,' and is doing it so damn slowly we will have years of uncertainty in what folk can plan to build on their own land.

 

Getting better homes faster

 

New Zealand needs more houses, and less Resource Management Act.

Fact is, if houses are going to be anywhere near affordable again, New Zealand needs many more houses, and no RMA. 

Instead, we have RMA for several more years, and a housing/RMA minister (Chris Bishop) who's created uncertainty and fewer housing starts by allowing councils to opt out of the (formerly) bipartisan Medium-Density Residential Standards (MDRS).

What can you do now on many sites in New Zealand's major cities? Don't know, because councils haven't decided (or announced) where and how they might relax things. The uncertainty means that on many sites in major cities desperate for housing, nothing gets started at all.

What could you do under the MDRS? In simple terms (see pic above), you could build up to 3 dwellings up to 3 storeys high without having to even think about the Resource Management Act. It was far from perfect, but still the most permissive housing change from government since ... well, before I was born anyway.

But Chris Bishop has "fixed" that, hasn't he. Too permissive for Mr Bloody Bishop. Too many "externalities." Too urban.

Urbanist Malcolm McCracken has a simple solution however that even this housing minister could (should!) get behind. He calls it Graduated Density Zoning, so it's still a bloody zone, but one that allows owners who amalgamate sites to get extra density and height -- and by their amalgamation build better things and ameliorate the effects on neighbours.

By being larger and a more appropriate shape for multiple dwellings, such a site would also encourage better housing typologies to be built than the simple long 3-storey-"sausage"-arranged-along-a-single-driveway that means everyone's window looks into every neighbour's.  Things like perimeter blocks, garden apartments and the like, with better privacy, garden outlooks and less iunmpact on neighbours (so what's not to like?!).

McCracken has details:

I propose that a condition of a council opting out of the MDRS, in whole or just in certain suburbs, should be the requirement to introduce Graduated Density Zoning6(GDZ) to residential land that is zoned below three storeys. GDZ is where, when a developer buys neighbouring sites totaling more than the set threshold, e.g. 1400m2, they can automatically build to a higher density. The details of that can be debated but I believe GDZ should be introduced to enable better housing choice and new supply in every neighbourhood. While resource consent would be required, once the threshold has been met, three-storey apartments and terraced houses would become a permitted activity.

Adopting GDZ could provide several key benefits:

• Larger sites can make it easier to manage the externalities of greater density, which have been some of the driving reasons behind the backlash towards the MDRS. This should see fewer sausage flats on single sites, which generally have poor design outcomes and interaction with neighbouring sites. Larger amalgamated sites will enable greater master planning that considers the interaction of outlook spaces with neighbouring properties, limiting driveway crossings and the design of open and communal spaces.
• It enables the market to deliver greater density in areas of high demand and better match this with new supply. While councils can plan through future development strategies for ‘enough’ capacity to meet future demand, this is always based on a range of assumptions, which can never be completely accurate. Amenities and accessibility of an area, along with personal preferences, can change shifting demand greatly. We should design our system to be more responsive and flexible to meet demand. GDZ would be a step towards this.
• Enabling three storeys, as I have discussed many times previously, can enable greater housing choice to be provided. It also enables ageing in place, where you can find housing suited to your needs at different stages of your life within the same neighbourhood.
• It’s worth noting that this can also benefit neighbouring landowners, who could choose to sell together to seek greater profit, which is possible as an amalgamated site is generally a better development opportunity. This has occurred previously, including in Te Atatū Peninsula in 2020.

Until or unless the RMA is abolished, this could be a start.

So, what about that RMA replacement then?

So in the next day or two the Labour Government's RMA replacement will have been repealed. Abolished. Extinguished. Labour's two replacement bits of law -- the Natural and Built Environment Act and the Spatial Planning Act -- will be gone by Christmas. 

Yippee!

In their place, we're back to the RMA.

Damn. And blast.

Labour's two replacement acts were as unworkable as they are unsayable. The RMA is just unworkable (as the three-decade long housing crisis has established). But that's what we will be back to -- along with faster consents for government projects (little help there for you and I and your friendly house-builder) and the as-yet un-detailed dangled carrot of some kind of "better" replacement to come.

When will we get it? Some time.

What will it look like? Who the hell knows.

There's nothing like opaque promises to create expensive uncertainty in a market, like housing, in desperate need of cost cutting.

Anyway, I have a solution. It seems to me that one way to create certainty, stifle NIMBYs, effect a more rapid transition, and begin the restoration of property rights -- a simple way to kill four birds with the same stone -- would be to give legislative impetus to a thing called the Coming to the Nuisance doctrine. 

The Coming to the Nuisance Doctrine is a little-known but highly effective principle that was a feature of common law jurisdictions until partially killed by statute, and all-but euthanised by the judiciary. (See for example Sturges v Bridgman – the case of a confectioner and a busybody doctor.) It lives on, partially, in Lord Denning’s famous dissenting opinion against a couple bewailing cricket balls coming through their greenhouse after moving next to a cricket oval. 

Conveniently, there are a few posts already written to help you read up on the doctrine. As the first one explains, the Coming to the Nuisance Doctrine is the antidote to what the planners have done to our cities ...

** “The Coming to the Nuisance Doctrine is the only objective means of determining who has the right to continue using his property in the event of a nuisance. If zoning is to be replaced, therefore, it must be replaced with the Coming to the Nuisance doctrine.”

    ~ The "Coming to the Nuisance" doctrine: The antidote to zoning – CAPMAG

** "I refer you again to a simple book that’s been on my shelf for well over thirty years. Its solutions are comprehensive – one simple solution being to outlaw zoning --

"'If … there were no zoning or land-use control laws, there would be considerably more housing at considerably lower prices and in areas considered more desirable.'

"Both common law and the systems set up in un-zoned cities like Houston protect freedom and property owners far better than zoning, which has only been imposed for a few decades. The problems are evident, the solutions are known, yet zoning of every New Zealand city continues."

"Men are born free but nearly everywhere in zones. Why? Because (as my well-annotated copy told me so long ago) so many cronies benefit from it."

    ~ Zoning for Special Interests

** “… it’s practical to remove the RMA overnight… Here’s how it could be done. FIRST, ENACT A CODIFICATION of basic common law principles such as the Coming to the Nuisance Doctrine and rights to light and air and the like. 

“Second, register on all land titles (as voluntary restrictive covenants) the basic 'no bullshit' provisions of existing District Plans (stuff like height-to-boundary rules, density requirements and the like).
“Next, and this will take a little more time, insist that councils set up ‘Small Consents Tribunals…”
    ~ What would 'Party X' do about the environment? - PART 3: Small Consents

** “What sort of person moves next door to a chicken farm and then complains about the smell?
The sort of people who live in Inglewood in Taranaki perhaps, who come to the nuisance and then seek to make windfall profits from someone else's destruction.”

    ~ "What nuisance?" And who came to it?

** "What I propose is another simple modification to law that would allow New Zealanders to once again repair to the common law protections that 'The Hammer' had made possible. In particular, the codification of the common law principle of Coming to the Nuisance  ... which, on its own, would be a powerful antidote to the zoning that the RMA has entrenched -- perhaps the strongest possible antidote to zoning there is. Supplementary to putting property rights in the Bill of Rights, then, ‘Party X’ could promote the reintroduction of the Coming to the Nuisance doctrine for use as an absolute in neighbourhood disputes."

    ~ What would 'Party X 'do about the environment? Part 2: 'A Nuisance and a BOR'

** “The principle of ‘coming to the nuisance’ was established (and then sadly in some jurisdictions dis-established); as was the principle of a ‘bundle of rights’ being associated with land, and some of those rights being acquired over time by ‘prescription.’”

    ~Cue Card Libertarianism -- Common law

How not to get more houses built (the Bishop/Seymour edition)

 

National's Chris Bishop and ACT's David Seymour have both helped cancel the one thing in recent years that (however imperfect) allowed us to build more houses. 

They argue instead that what people build is their business (not that of the property-owners who want to build) and that where people build should be restricted to where council decides (in its desultory way) to build infrastructure. To increase council's motivation to build, to move them from desultory to dilatory, Bishop and Seymour both declare a policy to give councils some of the GST from the house building that (eventually) results.

This will, say these budding urban planners, go towards building more infrastructure, and so, therefore, many more houses will be built! (You can almost hear the victory laps being run.)

Not so fast, says the phenomenon christened the Flypaper Effect.

The Flypaper Effect results when a dollar of taxpayers' money is sent to local government to spend. Turns out that "when municipalities receive additional funding, they don’t tend to spend it on improving public services, they tend to spend this money on special interest groups." And monuments. And if it's money from "above," as per the Seymour/Bishop model, they spend even more in more wasteful ways than if that dollar were raised directly from ratepayers (about which they're hardly parsimonious).

It's called The Flypaper Effect because essentially money sticks where it hits, i.e., "it sticks to that city and they use it [more] for interest groups and log-rolling and all of the rest of it," explains the economic paper outlining the phenomenon, and not so much for building infrastructure.

In simple words then: more monuments, not so much infrastructure => not so much infrastructure, not so much housing.

So it all rather makes a mockery of the Seymour/Bishop model for getting more houses built.

Idiots.

The Discomforting Solution to Homelessness

"PEOPLE ARE UPSET OVER THE homelessness problem in American cities," writes Jacob Hornberger. NZers are just as disturbed about our homelessness problem here. Visit any of our major towns and cities and you'll see the streets playing host to many poor souls unable to put a roof over their heads.

 

Most people pass them by, perhaps with a sinking sense of guilt. Or perhaps not. But the problem seems so intractable, so most do very little. 

If there's nothing to be done, why do anything at all? 

But there is something to be done, says Hornberger, and should be done by anybody who cares. Two things in particular, which you'll find at the bottom of the post. And could be done bloody quickly - iff there were a will.

But first, just think for a minute and compare two sorts of places. You see homeless folk on the streets when you walk the main streets of our major towns and cities. But think for a minute: do you see them so often, or at all, in any of the smaller towns or cities?? Even the poorer of our small towns and cities???

Hornberger grew up in what was officially the poorest city in the U.S. Located right on the U.S.-Mexican border, Laredo, Texas, his hometown, was also home to many new immigrants, both legal and illegal. And yet, as he says, for all the very visible poverty, "There was no homelessness. That is, there was no one living on the streets or in their cars, as we see in many American [or New Zealand] cities today."

Now, think about that for a moment. People say that poverty is the cause of homelessness. But if that’s the case, why wasn’t there any homelessness in Laredo?
    The answer is: At that time, there was was no zoning in Laredo. Anyone could establish low-income housing anywhere he wanted, including such things as trailer parks, low-priced rental units, and multiple-family housing.
    Thus, everyone was able to find housing at some price.

It's breathtakingly simple when you think about it -- and it's not because of any "wrap-around care" or any of the welfare buzzwords you hear that have been so unsuccessful at helping our own homeless folk.  And the simple fact is this: If governments restrict where and how many roofs can be put up (which is what zoning is designed to do: for the town planner it's a feature, not a bug), then there will be fewer roofs available for people to put over their heads. And those few will be at higher prices than they otherwise would.

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I should point out that Laredo also had public-housing units (which, ironically, had been started by my grandfather). But even if the government had not entered into the housing market, there still wouldn’t have been a homelessness problem in Laredo.
    When I returned to Laredo after graduating from law school, one of our legal clients was a man who specialised in building and providing low-cost housing for the poor — for a profit. He would buy his building supplies in Mexico, where he could get them at a much lower price, bring them back to Laredo, and use them to build low-cost motels. His motel rooms were oriented toward the very poor. They were clean and simple. People could rent the rooms on a daily, weekly, monthly, or yearly basis.     He always had a very high occupancy rate.
    He was free to situate his rental units anywhere in town. That same freedom applied to mobile-home parks. That’s because there were no zoning laws.

Take a short break and think about that again:  no homeless people because homes of all kinds (trailer parks, low-priced rental units, multiple-family housing, clean and simple motel units, mobile-home parks) could be situated anywhere in town. And they could be situated could be situated anywhere in town because there were no zoning laws.

Forgive me for writing this as if you, dear reader, were a six-year old. And for underlining those conclusions. But it seems as if those who refuse to understand this have less understanding of the world and how it works than even the most stunted young child. Allow builders the freedom to build where there is demand for it, and of the type that's demanded, and you will have more buildings at better prices that are warm, and dry, and occupied by those who were formerly homeless. That's the experience of places like Laredo. (Do you understand, Chloe Swarbrick, who walks past the homeless every day on K Rd, who says new homes should be built only in places town planners dictate. Do you even give a shit, Chris Bishop, averting his gaze, who says new homes should only be built where, and how, he dictates. Are you listening David Seymour, ignoring the waifs and strays around the less-leafy edges of his electorate, who says we must "fix infrastructure first"?)

That same freedom [says Hornberger] does not apply in cities where there is a homelessness problem today. I guarantee you: Show me a city that has a big homelessness problem and I will show you a city that has zoning.
    To protect citizens’ property values from such things as mobile-home parks and low-price housing, local officials enacted zoning laws. They figured that they could abolish “blight” by simply using the force of zoning laws to make low-cost housing illegal. What they ended up doing is producing a massive homelessness problem.
    Today, much of the anger that arises from the homelessness problem is directed toward the homeless. But what are they supposed to do — commit suicide? They can’t afford to rent a place in which to live because zoning laws have knocked out low-priced housing within the city.

Indeed.

Zoning only came to New Zealand in 1928 with the Town Planning Act (brought in by a conservative government, wouldn't you know). Back then, it was a relatively new phenomenon. But if you observe things today, you will notice that town planners and the like today much prefer to live in those places like Devonport, Ponsonby Parnell and the like that were built before town planners infested the country -- and the places that are built today based on town planners' rules are those like Albany and Manukau and (gulp) Hobsonville.

Unattractive. And (still) unaffordable by most measures. Especially to those sleeping on the streets.

Think about it.

AND THINK ABOUT THIS too, especially if you castigate homeless folk because "they should just get a job." Have you ever considered that government-mandated minimum-wage laws prevent them from getting a job at a wage that is lower than that government-mandated minimum? 

It's all very well for "Chippy" to crow about "raising the minimum wage," as if that has magically "lifted all boats" to that government-mandated level. But what he ignores, or hopes that you do, is that the real minimum wage is zero. Which is what most of those homeless are currently "earning." 

And most of those are only earning that because Chippy's much-touted raise in the government-mandated wages level simply places a large gulf between what they're earning, what they could earn, and what employers are allowed to pay them.

It's as if the Prime Minister were gloating about taking several rungs out of the ladder they might have climbed themselves, if he hadn't taken them away.

It would be one thing if they were free to get a job at less than the governmentally set minimum wage. In that case, one could legitimately say, “Get a job, you bum.” But when their labour in the marketplace is valued by employers at less than the artificially-set minimum wage, the state has locked them out of the labor market with its minimum-wage law. Thus, telling them to “Get a job, you bum” is nothing less than cruel and abusive. And if they can’t get a job, then how are they supposed to be able to pay rent for housing, especially when rents are exorbitantly high because of zoning laws?

It's a tragedy. But it's not intractable. It is fixable. It's fixable iff there were a political will to to do it.

Want to do something about the homeless? Tell your politicians to fix it. And make sure you tell them how:

(1) repeal zoning laws, and
(2) repeal minimum-wage laws.

"In Tokyo, good things [like affordable housing] have been created through private initiative.”

EMERGENT TOKYO: “This book demystifies Tokyo’s emergent urbanism for an international audience,
explaining its origins, its place in today’s Tokyo, and its role in the Tokyo of tomorrow”

"'As the Japanese government attempted to rebuild their devastated capital city [after the War], they initially drafted a comprehensive plan, but soon concluded that they lacked the budget to carry it out. And so, in areas where neither the government nor the country’s real-estate and transportation mega-corporations could properly fund reconstruction efforts, whole neighbourhoods instead rapidly rebuilt themselves. Working on a small scale, residents rebuilt homes and shops using scraped-together funds while relying on little more than their collective grit and inventiveness, and black markets full of micro-entrepreneurs sprung up around the city’s major train stations. These neighbourhoods were not initially planned, per se—they emerged, and their ramshackle, spontaneous spirit can still be felt today when walking Tokyo’s backstreets.
    "'This approach was adopted out of harsh necessity, but the resulting neighbourhoods have a striking charm: intimate townscapes with exceptional vitality and liveability, featuring a fine-grained urban fabric comprised of numerous small buildings.' ...
    "Because of Japan’s light touch, zoning it is relatively easy to build housing in Tokyo, and thus the city is not as 'unaffordable' as you might expect.*  Tokyo has also avoided the bland uniformity of the major cities in China....

    "Two full-time workers earning Tokyo’s minimum wage can comfortably afford the average rent for a two-bedroom apartment in six of the city’s 23 wards. By contrast, two people working minimum-wage jobs cannot afford the average rent for a two-bedroom apartment in any of the 23 counties in the New York metropolitan area. . . .
    "Some cities, like Singapore and Vienna, have bucked the trend by using public money to build affordable housing. Almost 80 percent of Singapore residents live in public housing.*
    "In Tokyo, by contrast, there is little public or subsidised housing. Instead, the government has focused on making it easy for developers to build. A national zoning law, for example, sharply limits the ability of local governments to impede development. . . .
    “'In progressive cities we are maybe too critical of private initiative,” said Christian Dimmer, an urban studies professor at Waseda University and a longtime Tokyo resident. “I don’t want to advocate a neoliberal perspective [sic], but in Tokyo, good things have been created through private initiative.”

~ Jorge Almazan, from his book Emergent Tokyo, NY Times from their article on 'How Tokyo Achieves Affordable Housing 'and Scott Sumner, from his post discussing both: 'Emergent Tokyo'

* 

RELATED:

 

Fix spec building to make Auckland affordable again - NOT PC, 2013
"The key to making Auckland liveable is to make it affordable—a fairly complicated and heavily politicised subject, so let’s try to make it simple: we won’t have an affordable Auckland until the model for “spec” building is viable once again.
""Spec building being 'speculative' building—a builder buying land, building a house and “speculating” he can sell it to a buyer for a reasonable profit. This is how the vast majority of NZ’s cities have been built, by small builders hoping to make a modest profit.
""But in recent years this model has broken. A simple back-of-the-envelope analysis demonstrates why...."

 

Zoning is is not a property right

 

I talked with someone last night who argued that the National Party's disgraceful backtracking on the bipartisan housing accord (which removes, albeit imperfectly, some restrictions on what you can do on your own land) is predicated on protecting people's property rights, rather than restricting them.

The argument -- the same confused argument that the idiots at ACT Party Central have been running -- boils down to saying that a land-owner has a de facto property right in the Zoning into which the local government's planners have thrown you. And that the central government has no right to tear that asunder. 

This is bollocks. As I said. It's also utterly confused.

Here's the truth: Zoning is is not a property right. "In truth, zoning is a fundamental violation of property rights":

The right to property means the freedom to produce, use, and trade material values. In regard to land use, this means that property owners has the right to use his land as he chooses, so long as he allows others to use their land as they choose.

In contrast, single-family zoning makes it illegal for a property owner to use his land for any purpose other than a single-family home. Under zoning, a land owner cannot use his property as he chooses, but only as government officials permit.

[The argument] implies that dictating how others may use their property is a property right. This is absurd, and it means the annihilation of all property rights. If one is not free to use his property as he chooses, the right to property no longer exists.

In principle, to claim that zoning is an aspect of property rights is equivalent to saying that handing one’s wallet to an armed robber is an economic trade. Both zoning and the robber use force to obtain a value. Both zoning and the robber violate property rights.

[Some who defend the argument go] on to equate zoning with what [they call] 'free-market zoning'—a contractual agreement among property owners to voluntarily limit the use of their land. Such contractual agreements exist today, and they are called deed restrictions, or covenants. However, there is a fundamental difference between zoning and deed restrictions. Zoning is mandatory and coercive. Deed restrictions are voluntary and contractual. To call deed restrictions a form of free-market zoning is intellectually dishonest.

Zoning is not an aspect of property rights. It is the exact opposite of property rights.

You would expect so-called advocates for the free market, as ACT and National are supposed to be, to know that.

Which suggests that they aren't.

[NB: The quoted excerpt is by Brian Phillips from the Texas Institute for Property Rights]

National promises more housing uncertainty [updated]

 

DESPITE RISING INTEREST RATES and falling housing demand, New Zealand remains in the grip of its decades-long housing affordability crisis. 

“New Zealand is not short of land," said National's Chris Bishop yesterday, "but restrictive planning rules and a broken funding system have driven up the price of land and housing, creating a social and economic disaster."

He said this while announcing National would backtrack on its own bi-partisan policy to free up restrictive planning rules just a little bit in New Zealand's most unaffordable cities -- a policy that has already been successfully introduced, in association with the Labour govt, and operating for nearly a year. Those new "3-storey" density standards (called MRDS) are a blunt instrument, sure, but they allow city property owners to build taller housing in greater densities in larger numbers than ever before. They have been the only relaxation of restrictive planning rules since ... anyone can remember. And Bishop wants to overturn that.

What a fuckwit.

The MRDS standards were finally introduced only last year -- and more houses and apartments are already being planned and built and lived in under those new standards -- building up instead of out -- buyers seeing large falls in prices for entry-level dwellings, consistent with increased supply enabled by the MDRS and related changes. 

In the way of these things however, with the uncertainty this policy announcement will now make, almost all that planning will now stop while everyone waits to see what happens now -- with all the further implications for housing unaffordability.

What a complete fuckwit.

Christopher Bishop is backed up in this fuckwittery by both his leader, Christopher Luxon, who signalled the backtrack last week ("I think we've got the MRDS wrong," said the fuckwit), and by the leader of the opposition David Seymour, who on this issue abandons his pseudo-liberalism and becomes instead the "Minister for More Rules and Restrictions" -- and by Seymour's thoroughly confused deputy Brooke van Velden who says "The right answer is to leave planning to councils."

What a pack of total fuckwits. NIMBYs to a man and woman.

No news yet on how National's deputy thinks about all this, who's just been thoroughly undermined, i..e., Nicola Willis, who co-sponsored these relaxed density standards with Labour's Megan Woods -- a rare dose of bipartisanship and possibly the only good move on housing any politician has made in at least half a century. So good that all politicians bar those from ACT's illiberal wing could support it.

Oh yes, Bishop couched his announcement of backtracking on relaxing restrictions within cities with a policy to have planners "release" some land on green fields outside them*. Building more out instead of up. Eventually. (And probably easily averted by the planners' art.) But he's hanging his hat on the headline writer's spin that something is being done.**

National has form on this. Before he was elected as Prime Minister, National's John Key announced he would "improve housing affordability by ... changing the building regulatory regime ... and [fix] the Resource Management Act." And voters believed him. Of course, once appointed, that fuckwit did no such thing, watching instead as house prices soared, and planning and building restrictions mounted -- and he was heard to declare that the house price inflation he had helped create would "fix" the leaky homes crisis by inflating it all away.

Who cared what that did for first-home buyers. Certainly not the Prime Minister.

SO WITH HOUSING ONCE again a political football, we await an election to sort out which fuckwits where get to tell us where and how we're allowed to build, planning rules in and around our city are once again completely up in the air -- as they were while we awaited certainty around the MRDS. And without that certainty, it's impossible for developers and builders to make real plans, uncertain as they are as to how council's planners might be allowed to curtail them.

Sure, freeing up any land or planning restrictions anywhere will help housing affordability eventually. But it's not clear that the Christophers' city-edge botch-up is the solution, even if it were to free up anything at all.

Up or out? Why not both.

And why give those planners any bloody power at all?

* * * * 

* Bishop's policy is to require planners "to zone land for 30 years’ worth of housing demand." Those measuring whether this is achieved will be the same planners who wrote the rezoning rules - making it easy for planners to avoid. And he ignores that simply "releasing" land on its own does not necessarily make land cheaper.

The RMA's requirement for planners to undertake a cost-benefit analysis before writing new rules, easily fudged, and Auckland Council's continued fudging over the MRDS requirements demonstrates on their own how easy it is for planners to wriggle around these kind of requirements, and how willing councils will be to back them up.

UPDATE

** And Auckland Councillors are already "confirming" that no new land will be rezoned as a result of this -- the Auckland Unitary Plan, they say, already has all that Bishop asks for.

'Meaningful school choice would elicit shrieks of anger from upper middle-class homeowners. Too bad.'

"There are ... unwise government interventions that I would wish to eliminate, but that I would also not willingly push a button to eliminate immediately.... I’m ... sufficiently influenced by the works of Adam Smith, Edmund Burke, Lord Acton, and F.A. Hayek to understand that large, sudden changes to an economy or society can be dangerously disruptive, even when such changes involve reversing policies that should never have existed in the first place....
    "But there are buttons I would push. [One] button that I would push is one that would greatly enhance school choice. Starting with the 2023-2024 school year, I would, if I could, use a combination of tax credits and vouchers, paid for out of current government-school revenues, to end everywhere ... the monopoly grip that ... government schools and teachers’ unions have on low- and moderate-income families. This move would, in my ideal world, be a first step toward a complete separation of school and state. The squeals of the unionised teachers would be loud, as would the wailing of government-school administrators. But the pain suffered by these long-time coddled interest groups would be far surpassed by the immediately heightened incentives to improve their teaching and to tamp down their efforts at indoctrination.
    "Perhaps this sudden move toward meaningful school choice would elicit a few shrieks of anger also from upper middle-class homeowners, whose suburban property values currently reflect the superiority of the government schools in their neighbourhoods relative to the abysmally poor schools in other neighborhoods. Too bad. These property-value premia are no more just than they would be if they were instead caused by upscale areas having, say, better government-run supermarkets compared to the government-run stores in poorer neighbourhoods. If the fall in middle- and upper-income people’s property values caused by improving poor people’s access to food would be no reason to keep poor people stuck with incompetent supermarkets, the fall in middle- and upper-income people’s property values caused by improving poor people’s access to education is no reason to keep poor people stuck with incompetent schools."

~ Don Boudreax, from his post 'Some Buttons That I’d Not Push, and Some That I Would Push'

'The Housing Theory of Everything...'

Two snippets from Houston Strategies post 'The Housing Theory of Everything...':

"Few Mayors Connect the Dots Between Zoning and Homelessness - Restrictive codes can severely limit housing development, but a new survey of mayors finds that few take them into account in their plans to address homelessness. This is definitely a major factor in Houston's relative success in alleviating homelessness vs. other major cities....

"Everything Is About the Housing Market - High urban rents make life worse for everyone in countless ways. I expect this “housing theory of everything” to continue to catch on because it’s absolutely right. It’s related to what I’ve been talking about for years with the four factors that go into Opportunity Urbanism, including discretionary income, that determine how vibrant a city can be. If you pay too much for your house, you don’t have money to put into other things. That has been covered up for decades now by the wealth accumulated by those homeowners, but that’s a short-term effect that’s diminishing...."

Occupational Licensing --> Corruption

"Occupational licensing is like the 'land zoning' of labour policy -- largely hypothetical health and safety edge-cases get used to justify a system that's just 95% about exclusion and graft."

~ M. Nolan Gray, commenting on 'Bogus beauty, nail and barber licenses being sold under the table in DC'

 

"Fix housing regulation and you go along way toward fixing malinvestment."

"Most people don’t understand this process. When they see it play out, they misdiagnose what is actually going on. I see article after article claiming that [central banks like] the US Federal Reserve 'artificially' lowered interest rates, and that this created “malinvestment” into unproductive projects. They claim the problem can be fixed by raising interest rates to a level that imposes discipline on investors, a rate that doesn’t allow for low quality investments to be profitable. That’s wrong.
    "[New Zealand] does have a malinvestment problem, but it’s not at all what many pundits assume. The cause of the malinvestment is zoning and other regulations that make it difficult to build housing. And housing is not just another sector; it’s a key part of investment. These bad regulations push saving into areas that are less productive than housing construction, including marginally productive government and corporate investment.
    "The problem of malinvestment cannot be fixed [just] by having the [Reserve Bank] tweak interest rates; it requires much more fundamental solution. The only way to fix malinvestment is to remove regulations that prevent developers from building what people really want, which is high-quality housing. [Cities like Auckland were transformed in the 1920s when a ring of affordable yet attractive California bungalows were built by profit-seeking speculators at the end of new tram lines. But New Zealand has lost the ambition for such things, and settled instead for three-storey stagnation.]
    "If you ask most people what stands in the way of them having the sort of lifestyle they wish to have, not many will mention a lack of food or clothing. Most have adequate cars and TV sets. Most have a school to send their kid to and some form of health care. Instead, housing is the one area where lots of people are dissatisfied, where dramatic improvements in living standards are still possible. But that requires building new housing in locations close to good jobs. Bandaids such as rent control do not result in a single extra person having housing, and indeed reduce the housing stock in the long run. More housing is the low hanging fruit to raising living standards. Fix housing regulation and you go along way toward fixing malinvestment."

~ Scott Sumner, from his post 'Zoning and 'malinvestment'' [US references have been localised]