Capital’s new home consents lag behind

We are in the middle of a housing crisis, with homes already in short supply and tens of thousands of new residents expected to move into the city in the next three decades. Wellington’s transport plans are based around future large-scale development.

But new data shows permits for new homes are not being approved in the capital at anything like the required rate. Not only that but Wellington is woefully behind other main centres when it comes to greenlighting new homes.

Auckland and Christchurch are seeing twice the number of new dwellings compared with the Wellington region as a whole, on a per capita basis, according to new numbers from Stats NZ.

Looking at Wellington city alone, the capital is approving home builds at one-third of the rate of the other two biggest cities and ranks 50th among 67 territorial authorities for new dwelling consents.

Wellington is in desperate need of new homes. The region is expected to grow by 200,000 people while the city is expected to swell by 50,00080,000 over the next 30 years.

But it is not necessarily all bad news – industry insiders point out that Wellington could avoid oversupply and that the market is cooling rapidly.

CoreLogic head of research Nick Goodall pointed to a catch-22 in the situation. The 50,000 to 80,000 expected new residents would increase rent and house prices, which, in turn, could make Wellington unaffordable, leading to people leaving and less demand for homes.

But a lack of building in the city would be good for those who already owned property, as there was less chance of oversupply driving values down.

Wellington City has issued 4.6 consents for new dwellings for every 1000 residents so far this year – putting it a little ahead of Dunedin’s 4.3 but well behind Auckland on 13, Christchurch city on 13.1, and Hamilton on 8.3. The national figure is 9.8 new consented dwellings per 1000 people.

Liam Hodgetts, the Wellington City Council’s chief planning officer, said comparing Wellington with Auckland and Christchurch was ‘‘comparing apples with oranges’’.

The biggest difference was the influence of greenfield developments and opportunities at the edges of cities. Wellington, as a hilly harbour city, had far fewer options for spreading out, he said.

‘‘Wellington City has hardly any easily developed greenfield sites, therefore focusing on densification in existing urban areas is the only practicable option of any scale.’’

Comparing Wellington with Auckland’s central Waitematā ward – which is a similar geographic size and contains the urban core of Auck

land – made the comparison more similar, with 4.4 dwellings per 1000 residents, Hodgetts said.

Wellington was issuing four times the volume of consents of Waitematā, with 43 consents compared with eight, he said.

While the city has fallen away from the peak of the housing affordability crisis – with house prices and rents falling – accommodation still remains a big cost.

Tommy’s sales director Nicki Cruickshank said the lack of new dwellings was a symptom of what was happening in the real estate market.

Huge numbers of townhouses built in the past were bought by speculators, investors and first home buyers, she said. Speculators had now bowed out amid a falling market, investors were dropping as interest rates climbed, leaving just first home buyers.

She expected new consents would soon come to a ‘‘screaming halt’’ as a result. There were still a lot of properties being built in Wellington but ‘‘no-one buying’’, she said.

Wellington mayor Tory Whanau said Wellington’s existing high density and ‘‘compact urban form’’ was what residents loved about it but it did slow down building.

‘‘Housing intensification does take longer to plan and consent than single dwellings but do it well and it is a long-term investment that will positively shape the city.’’

A drive to intensify populations in intensified housing around public transport spines is a major part of the $6.4 billion Let’s Get Wellington Moving (LGWM) transport overhaul. The LGWM mass rapid transit route would unlock ‘‘enormous housing potential’’ from the railway station to Island Bay, she said.

‘‘Our plans for intensification also include the centres of suburbs like Johnsonville and Tawa where there are already excellent publictransport links,’’ Whanau said. ‘‘I campaigned on housing intensification and remain 100% committed to making it a reality. I am also committed to advocating with central Government for legislative change to speed up the building consent process.’’