Six thousand new homes in ‘special housing areas’ is the Government come back at the RBNZ’s new loan rule. The special housing areas are in Auckland and in areas where land values are low. The aim is to provide affordable homes for first home buyers who have been hit hard by the new loan rule. The new rule restricts lending to eighty percent of LVR (Loan to Value) ratio and it’s not a move the Government wanted. Their solution to combating the rising property prices is to inject more supply to meet the demand.
Intensification is the main aim of the Auckland Super City council – where more homes are put on existing land this opens up lots of opportunity to existing home owners with sections large enough for a second home at the front or rear of their existing property. This intensification focus (under the unitary plan) coupled with the new land developments in the Auckland region aim to met the growing demand for housing in Auckland.
The challenges are great and there are many – from speeding up the consent process so developments can get approved and underway to attracting buyers to these special housing areas where the sections are very small – likened to having an apartment out in the sticks. With these smaller homes comes the added challenge of providing the appropriate infrastructure i.e. recreational areas. When you take away the backyard it needs to be replaced with communal recreational areas and they come at a cost. A cost usually put onto property developers – who in turn pass it on to the consumer, the Government wants to relieve the Developers of this additional cost so the houses remain affordable to the first home buyer.
No one can say it’s not exciting times for Auckland with big changes imminent for all.
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