Mark Southcombe

Market economics suggest that increasing affordable housing supply is the answer to the housing problem.

New housing supply in New Zealand is dominated by speculators and developers, particularly the large design and build companies who monopolise land supply for larger housing developments and associated profits. Land cost has been the major component of the increase in housing costs since 1997. The idea that demand will drive affordable housing supply conveniently ignores the inherent contradiction between affordability, and supply and demand in a market where there is short supply. The market seeks not to make more affordable; it seeks to make as much profit as possible within the parameters of so-called affordability; to maximise the minimum acceptable cost. As Alistair Parvin, Cristina Cerulli and colleagues note in The Right to Build.

Speculative houses are not principally designed as houses to be lived in, but rather as financial assets to be sold or rented. In a market where developers do not have to compete in terms of quality, the effect of this can be huge.

A diversified range and quantity of housing procurement can improve the New Zealand building industry performance significantly. Proven international direct urban collective housing procurement processes can be readily introduced, adapted and facilitated here.

Alternative building delivery mechanisms can share risk to facilitate a more efficient, economic, resilient, responsive, targeted, faster and effective affordable housing market. Key to this occurring is being smarter about the supply of Land.

Government, major local authorities and the not for profit community housing sector have a major role to play here. Developers typically privatise public land for private profit in the name of ‘partnership’. We can do better and deliver more higher quality social and affordable housing by facilitating mixed tenure collective housing group projects.

It’s access to the land that makes this possible. With cohousing these housing sites can remain in collective ownership, be developed collectively, and remain available to house future generations. They will also be more socially diverse and cohesive because of the shared community components.

It’s a no brainer.