Before anyone can build a house in New Zealand, someone must pay for the pipes and the roads that connect a development to the city. While this seems like a minor detail, it is a central issue for housing affordability.
Almost always, the council pays for these connections upfront. And a council can only borrow so much, about two to three times what it collects in a year. Once it hits that limit, it can no longer pay for the water pipes, the drains and the roads that a new suburb needs. As a result, the council rejects proposals for new housing developments. It uses its planning rules to keep the land empty instead.
To read the article on the NZ Herald website, click here.