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Dr Phil McDermott

Meeting Auckland’s Urbanisation Challenge

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Housing hogs the headlines, but Auckland’s issues are bigger than that: how to manage resurgent urbanisation in the 21st century.  The answer is much the same as in the 20th century – get the land market working effectively.  This means

  • Understanding that without the land none of the other measures aimed at making housing affordable and urbanisation sustainable will work;
  • changing traditional mind-sets;
  • realigning institutions;
  • reforming regulation;
  • rethinking infrastructure;
  • rebooting funding.

A Multi-Faceted Approach to Land Supply

The issue really is land.  While intensification has a role, it is simple minded to think we can build our way out of urban pressures by boosting densities within existing boundaries.  Multiple expansion paths are necessary for social and practical reasons.  Over-reliance on urban intensification raises questions around extending old infrastructure, dealing with congestion, how we use transport corridors, health and social issues associated with confined living conditions, and reduced resilience in the face of service disruptions from natural events and service failures.

We need to bury the assumption that urbanisation requires contiguous development.  Places aren’t urban simply because they are joined at the edges.  Instead think about urbanisation in terms of networks facilitating transactions among nodes at a variety of scales.

This opens up opportunities for boosting land supply on several fronts:

  • Treat townships and villages as connected growth nodes. In Auckland this means expanding existing townships without sacrificing their character – for example, Warkworth, and Waitoki in the north, Waimauku and Helensville in the west, Whitford and Clevedon in the east, Pukekohe and Tuakau in the south.  Each is surrounded by farmland and bush and linked to the region’s key north-south corridors and through that to central Auckland.
  • Promote larger but physically discrete settlements, creating distinctive sub-urban communities. In Auckland attractive settlements can be developed in Dairy Flat, Riverhead, and Kumeu in the north and west, and around Beachlands-Maraetai in the east; Drury, Ardmore, Runciman, and Karaka in the south.
  • Reduce the red tape facing suburban intensification, especially given increasing opportunities as ageing boomers relinquish their legacy of single dwellings on large plots. Well-designed terrace houses, low rise apartments, and residential villages can shape intensification without undermining sub-urban communities.
  • Brownfields redevelopment poses a challenge, and will make at best a patchy contribution to land supply. Title consolidation, infrastructure rehabilitation, and decontamination are costly.  Increased congestion on the city’s critical arterial routes calls for costly transport solutions. Impacts on nearby households and businesses are problematic.  Consequently costs are high, often prejudicing the quality of development.
  • And for traditionalists still wedded to sprawl based on stretching arbitrary urban limits there are possibilities for pushing existing suburbs beyond, say, Albany, Orewa, and Silverdale in the north; Massey and Hobsonville in the west; Wiri, Hingaia, and Papakura in the south.

A multi-faceted, multiple-location approach like this should reduce speculative gains and discourage land banking.  It should support more medium scale developers and builders, moderating costs attributed to the current mix of a few large developers many small builders.  And it will diversify investment and funding possibilities.

So how can we implement this? 

First, change the planning mind set.  We need to think about urban communities, not just buildings.  This means shifting from planning based on counting potential house sites and mechanically projecting assumptions about house numbers into an unknowable future.  Instead, identify places where current and future communities can develop, and then minimise the obstacles to housing, business investment, community centres, commercial development, recreational facilities, parks and the like.

We also need to accept that urbanisation is as much about connections among discrete centres as about uninterrupted development. It need not mean building houses to the horizon, or erecting walls of apartments.  Instead it can take the form of settled landscapes shaped by natural features, a patchwork of urban places linked by green transport corridors.  A shift in mind set also means accepting that the best opportunities for sustainable or smart settlement lie in green fields.

Changing minds is a challenge.  Recognising that the current housing affordability crisis and the associate equity issues flow in large part from 25 years of planning to contain Auckland would be a start.  Changing mind sets is unlikely. though, without shaking up the planning regulations and the institutions responsible for them.

So second, we need to change the regulatory framework which makes it comfortable (and easy) for traditional minds to remain wedded to incrementalism, replication, and control.  This means rewriting New Zealand’s environmental legislation to clarify the environmental limits to development, and consequently define where development can take place as of right, and without seeking to control its every detail.

Third, we need to realign our institutions.  Professional institutions (in engineering, planning, and design, for example) need to lead the way in new thinking, rather than simply reflecting the current consensus or promulgating “best practice”.  Tertiary courses need to encourage critical thinking and grounded analysis, and experience rather than dogma, without losing sight of the need for skilled practitioners.

We also need to understand the constraints on innovation and flexibility that come with large scale councils, especially as the Local Government Commission pursues its own agenda of consolidation.  Apart from reducing the capacity to respond to local circumstances, reducing council numbers will diminish the local government labour market compounding the conservatism that seems to bedevil policy-making today.

In Auckland, simply moving planners from one office to another was never going to boost housing supply quickly or resolve growth challenges.  And a monolithic council writing a bigger, better plan using the same old approach to rule writing was never going to make it easier to get things done.

How about creating a public agency charged with defining and assembling areas for urbanisation throughout Auckland and adjoining regions?  A development corporation might even purchase, consolidate, and on-sell land for urbanisation, or put it out for tender with development opportunities linked to clear social objectives.

Agreements between councils acting for communities and developers can facilitate the development of well-designed, amenity-rich urban settlements.

Fourth, rethink infrastructure.  Get away from monopolistic suppliers and old technologies so that more innovative agencies can apply modern, cost effective, resilient and, as likely as not, decentralised  solutions to water supply, wastewater disposal, power generation and distribution, public transport, and the like.

Fifth, rethink funding.  Why should purchasers of new homes have to fund long-term infrastructure given that they will play an active role in a community’s social and economic life and assume a share of existing fiscal liabilities?

The real beneficiary of development is the party that sells land into a higher value use.  A levy on the value realised from moving from rural to urban use or enabling intensification of underutilised urban sites would be a more equitable approach to funding new urban development and less likely to push housing costs up than a levy on home-buyers.

More private investment in infrastructure would be attractive to equity and debt funding.  Quasi-commercialisation through Council Controlled Organisations hasn’t obviously improved the funding or pricing of infrastructure.  Given that private and public monopolies become conservative and self-serving, full commercialisation to create a competitive environment or effective regulatory oversight may be the best path to improved funding and more innovative development.

Sixth, back off prescriptive council plans. Instead, use broad  spatial plans linked to long term council financial plans, setting out long-term land use directions.  These would show where money is planned for public services and amenities, providing sufficient certainty for infrastructure and service providers to prioritise their own investment.

Rebooting Urban Development

The Auckland experience of unaffordable housing driving a wedge between generations and among communities, of transport demands outrunning the physical capacity of existing infrastructure, and of the damaging fiscal impact of high cost responses is by no means unique.  Urbanisation in developed countries in the 21st century requires a reset of how we think about our cities and how we manage them.

In Auckland, this means accommodating multiple paths for development and multiple sites for expansion.  It also means getting away from arbitrary targets and constraining rules which narrow options and over-ride the dynamics of community development.  It means breaking down monolithic and monopolistic structures where these impede innovation and constrain investment options.  It means encouraging and empowering people and agencies that can pursue alternative ways of achieving urbanisation, urbanisation that reflects and serves community rather than kowtowing to those who would see the community ruled by a dated blueprint of how cities should be developed.

*More details can be found HERE