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Report links land prices to planning

Published: 8:52AM Wednesday March 01, 2006 Source: RNZ

A new report on housing says town planning regulations might be partly to blame for high land prices driving up housing costs.

The report by Motu Research has found land prices increased by almost three times as much as overall house prices between 1981 and 2004. Motu Research was commissioned by the Centre for Housing Research to do the report.

Motu found that on average house prices increased in real terms by 105% between 1981 and 2004 while and prices went up 286% in the same period.

Motu's senior research associate Arthur Grimes says the rise in land prices was largely responsible for house prices going up. He also says land prices might be rising so quickly because of town planning regulations aimed at restricting urban sprawl.

Grimes says Auckland land prices vary quite markedly between different local authorities.

Owen McShane of the Centre for Resource Studies says it's a relief that an authoritative piece of research has identified land prices as the key issue. He says present policies which try to constrain city boundaries are just daft.

Fletcher Building agrees with the report out. The chief executive of Fletcher Building's infrastructure division, Mark Binns, says restrictions placed on Auckland's urban boundary have created real problems.

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