New research shows evidence of the impact of restrictions to land supply on house prices
Published 28 Nov 24
A new research paper finds direct evidence of how restrictions to land supply can increase prices.
The paper Analysis of Availability of Land Supply in Auckland is the product of the Housing Technical Working Group (HTWG), a joint initiative of Te Tai Ōhanga – the Treasury, Te Tūāpapa Kura Kāinga – Ministry of Housing and Urban Development and Te Pūtea Matua – Reserve Bank of New Zealand.
Analysis of Availability of Land Supply in Auckland provides an assessment of how restricted land supply is in Auckland and how this has changed. It finds direct evidence of restrictions (including, but not limited, to regulation and infrastructure provision) on the supply of urban land.
The paper builds on the findings of the HTWG’s first publication, Assessment of the Housing System: with insights from the Hamilton-Waikato Area. That paper suggested that restricted urban land supply in New Zealand significantly affects the response of the housing market to things like changes to interest rates and taxation.
Among the latest paper’s findings is that these restrictions are estimated to have added $378.4 per square metre to the price of urban land immediately inside of the rural urban boundary line in Auckland in 2021.
The paper also found some evidence that the availability of urban land in areas of Auckland improved over the five-year period, following the introduction of the Auckland Unitary Plan.
Analysis of Availability of Land Supply in Auckland is produced by Mariona Roigé Valiente, Andrew Coleman, Nam Ngo and Chris Parker.
Read Analysis of Availability of Land Supply in Auckland(external link)
Copies of the HTWG’s two earlier papers can be found here:
- Assessment of the Housing System: with insights from the Hamilton-Waikato Area | The Treasury New Zealand(external link)
- What drives rents in New Zealand? | The Treasury New Zealand(external link)
