18 Jul 2015

Warning on Auckland housing infrastructure deficit

3:31 pm on 18 July 2015

Unless roads and drains are given proper attention, attempts to solve Auckland's housing crisis could fail, according to the New Zealand Council for Infrastructure Development.

Nick Smith at a housing development in Three Kings in Auckland.

Nick Smith at a housing development in Three Kings in Auckland. Photo: RNZ / Kim Baker Wilson

The median price of Auckland houses has surged 26 percent in a year from $600,000 to $755,000, putting them beyond the reach of many.

The Government rejects claims that foreign buyers are responsible for the steep price increases, instead saying years of restrictive practices and red tape have cut the supply of houses and sections.

It says those bottlenecks have constrained supply, leading to steeply rising house prices.

The Government's response has been to fast track special housing areas to increase the supply of properties.

But the Council for Infrastructure Development fears this could be a short term fix only, unless proper infrastructure is developed for these places.

Chief executive Stephen Selwood said the problem of inadequate infrastructure had not been properly addressed.

"The ability to develop those areas depends on the infrastructure services from water to electricity, to roads, to public transport; to enable those special housing areas to work effectively," he said.

"We have to make sure we get a close linkage between the infrastructure investment programme and the land supply, and to date the desperation to bring on land means that linkage has been relatively weak. And that means we could have problems in the future."

Mr Selwood said this problem applied to areas on the outskirts of the city, near Helensville, Papakura and Orewa, where motorways were at full capacity.

But it could also be a challenge in brownfield areas such as Glen Innes, where further infrastructure development was also needed, he said.

Similar problems have been described by the Productivity Commission in a draft report unveiled last month.

The Productivity Commission recommended central and local government work more closely on long-term planning, to ensure infrastructure and amenities were ready when needed.

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