Kaikoura rail prospects

The rail from Parnassus through to Kaikoura was the very last (because the toughest) main rail link to be completed.  In 1940 ish (see http://www.railheritage.org.nz/Register/Listing.aspx?c=21&r=4&l=35 and http://www.newzealand.com/int/article/where-the-mountains-meet-the-sea/ ).  There was the start of an alternative routing north out of Parnassus during the Depression and the embankments for the bridge over the Leader River are still there as evidence of that.  There was also a rail branch to Waiau, but that vanished in the 60's/70's rationalisations although the line from Waipara to Waikari is still extant, used for heritage excursions.  From Waikari to Waiau is easy country with one major river crossing (Hurunui) only.

But the talk of 'alternative routings' is fraught:  the entire area from Waiau (inland) or Conway (coast) is riven with faults, has steep gullies (inland road SH70) plus even after the much-photographed and ooh'd-aah'd over coastal section north from Oaro,  there is a long climb out of Oaro south through steep coastal cliffs, through a tunnel (Conway Bluff) then up the Conway to Parnassus.  And as those faults run across the line of the coast and of any alternative route, no route can be thought of as 'safer'.

For my money, extensive rock shelters would proof the line against the inevitable slips and rockfalls:  these are common after heavy rain in any case, let alone quake/fault events. And at least we know exactly where all the vulnerabilities are, now.   Shelters would also preserve the views, which is a major drawcard for the whole area.  They won't be cheap, though...

Schadenfreude over Energiewende

Sacrificed Landscapes – How the Energiewende Is Destroying our Landscapes.  Book (in German, initially) soon to be published:  author is Georg Etscheit.

In the book’s promotion video, a number of Germany’s leading environmental experts are seen denouncing Germany’s Energiewende, as they are aghast at what is going on.

Prof. Dr. Niko Paech, sustainability scientist, says:

"What’s awful about the destruction of the landscapes and the government is that all of it has a legitimization.”

and

"The German Energiewende has become a justification for destroying our last remaining natural landscapes.”

and

"Science is legitimizing a rampage against nature. We destroy the landscape while we claim it is serving the ecology. It’s a cannibalism by the measures. Climate protection is the aim that justifies the means to destroy all other remaining environmental media.”

Dr. Gerhard Gronauer, pastor:

Climate protection that uses technical means against nature is a contradiction in itself.”

“Greatest fraud project”

Jörg Rehmann, journalist and author:

"If we want to survive on this planet, we need an Energiewende. But what the policymakers have made of it is not an Energiewende, rather it is the greatest fraud project since the end of the second world war.”

and

"Serious science has long proven that the Energiewende cannot in any way reach its targets. Society has to bear billions in costs, already energy prices are exploding, and policymakers are driving us further into a nuthouse in the clouds.”

Hmmmm.......

Building lotsa Houses Fast

There's a win-win-win proposition possible. I've harped on aboot this for so many years that the words just write themselves. And there are of course, Trade-offs - this is a real-world deal after all.

First things first:

• Gubmint is best at setting overall parameters, and a small amount of pump priming So the single overall parameter of note is multi-proof consented house designs, and the pump priming is getting one or more housing factories manufacturing those designs, at volume.
• Multi-proofing the designs side-lines the stupid TLA's and their interminable and expensive consenting processes.
• Getting a few House Factories up and running means some development incentives, and some volume: the former possible via e.g. tax or depreciation breaks, the latter via letting social-housing contracts for hundreds of houses to achieve short break-even times for aforesaid factories.
• My personal favourite: staff these factories with re-trained and now unemployable TLA consenting wallahs. Instant productivity increase, This is, of course, not a compulsory feature. But oooh, wouldn't it be nice (to mis-use a Beach Boys lyric...)
• Finance all of this via a combination of Stamp Duty, CGT and swingeing differential rates on buildable but bare land - could even be relatively small net cost compared to the increase in social utility via warm, snug (of which more later) and cheap houses.

Ah, those trade-offs:

• Accept that small, highly modular designs are all there is. Small = less cost, modular = able to be cranked out by automated machinery in factories.
• 'All there is' means abandon architects, consultants and the plethora of ticket-clippers who infest the building industry as currently constituted. If any of these types find themselves unemployed, into the Factories with 'em...
• Alter district plans top-down, by building into the NPS the requirement that houses produced this way override district plans, NIMBY's and BANANA's and the production thereof would constitute Compliance with the NPS. This accords with the rising realisation that Awkland could well sink the rest of us if left in the bumbling hands of ACC i.e. it's an issue of national significance

The target would be not less than 15-20,000 such houses per annum, over the next five years. As Christchurch demonstrates in spades, flooding the market with lotsa land and building lotsa houses (and, BTW, doing it the old-fashioned way, with occasionally drug-tested hammer-hands clonking frames together out in the weather) has screwed house prices to affordable (barely) levels through the Magic of Markets. Doubters can consulthttp://mikegreerhomes.co.nz/home-and-land/search/ and try Faringdon: house plus land start at $419K.

I've no doubt that this is doable. It just takes the will (and the cojones and vertebrae amongst politicians of all stripes). Aye, there's the rub........(Awkland Unitary Plan pun included for your delectation)....

Why RBNZ can't solve the Auckland Housing Bubble

Common taters who pooh-pooh the effect of Supply are ignoring the Christchurch experience.

There, a CERA-led Land Use Recovery Plan got a whole lot of large subdivisions moving toute suite, and it's possible to buy a section in (say) Rolleston, one of the new growth centres, for mid-$100K. Example: Faringdonhttp://www.faringdon.co.nz/building/house-and-land-packages/ Or try a wider search:http://www.mikegreerhomes.co.nz/home-and-land/

Read that, Awklanders, and weep into your cereal.

The solution to housing unaffordability is a complex, multi-year deal, completely out of the reach of the hapless RBNZ. Consider the following non-central-bank actions needed:

• trust-busting action over the cosy building-materials cartel duopoly, to lower material and hence build costs
• elimination of zoning and other Brit Town and Country Planning artefacts: zoning, amongst other evils, causes Commuting, as living and working are forced to separate areas by planning fiat.
• Encouragement of modularised/factory built housing - CNC gear, tight tolerances, built under cover by certified workers. Not bashed together on site by occasionally drug-free hammer hands and left to stand unprotected in the weather for weeks at a time. Unemployed Planners could usefully be press-ganged into such factories - win/win/win
• Self-builds and other sweat-equity schemes could be revived. The current crop of regulation is unlikely to cost much less than $50-100K per dwelling, once fencing, scaff, fall protection, lost time, etc etc are accounted for properly. But it's All fer yer Own Good, little serfs....If we reverted to the situation of 15 years ago, when practically none of this crap existed,.....
• Reform TLA regulation by introducing time-money into the equation and make them responsible for accounting the opportunity costs they impose. Time costs, incremented at IRD's UOMI rate, would be a start. TLA's inject time into every process imaginable, and currently have zero awareness of, and thus have zero accountability for, the costs they thereby force onto others. Time for some transparency.
• Bring in friction to the sale process: stamp duties, CGT, whatever. A Tobin Tax if you will. In a similar vein, make TLA's tax the living bejasus outta unimproved but buildable land. They can do this by a simple differential rate, Ten or fifty times the going rate would claw back some the unearned CG the land bankers are squatting on, and might help to get something Built on that bare dirt.

Precisely none of the above can be done by Aunty RB.

It was done in Christchurch by emergency powers - benevolent diktat if you will.

Fat chance of anything happening in a national sense though.

That would take pollies at Gubmint and TLA level with the correct combinations of brains, thick skin, cojones and vertebrae. No such animal exists, despite extensive Attenborough-type searches over the years.

Why housing supply is strangled

Common taters seem to assume that it's purely a Gubmint issue - ban furriners, build anything anywhere, tax the living daylights outta Them As Wot As Deemed Bad. Essentially, take one or two simple actions, wave the wand, and presto, Nirvana is delivered. Etc., etc.

The issues are much more numerous, intertwined and complex than that. A sampling:

• The price of land, as the Productivity Commission has long since noted, is wildly distorted by MULs, RUBs and other emissions of Plannerz Feeble Brains.
• The price distortion is of such long standing as to have become structural. That is: inflated land prices have spread to neighbouring properties, suburbs, localities and cities.
• If the land price is wrong (ht the much-missed Hugh Pavletich), everything on top is wrong.
• Gubmint policies to "help the FHB" such as Welcome Home loans have instead served to cement in a price floor, thus institutionalising the price ratchet effect.
• Building material prices are in the steel vice-grip of a cosy duopoly, so materials alone are much more expensive than they need be. A quick Google of Bunnings, the co.nz and the com.au, should serve to convince the unbelievers.
• The LBP mania rules out self-builds, sweat-equity and other self-help possibilities. Time was when anyone could build their own. Norman Kirk did. No more.
• TLA 'contributions' can be measured at close to $100K per dwelling, for all manner of things, on a take-it-or-leave-it basis. A natural monopoly, completely unregulated...
• Elfin Safety adds $5-10K layers at every turn: for such innovations as scaff, fall protection, site meetings, inspections, certifications of scaff and electrical cords and tools, Most completely unknown (and, arguably unnecessary) 15 years ago. Ask older tradies (who have, sensibly, quietly faded into the shadows or gone under the radar)
• Building inspections and other regulation is mainly concerned with liability avoidance, not actual structural assessment. Witness the mountain of Producer Statements for every bracket, beam, bolt, fitting and component. Easy to count and file to get the ticks, very little relationship to (say) the performance of the structure in a severe earthquake. There's little to no dynamic testing (e.g. exerting a 0.5 tonne upwards force on a purlin to test security in a gale or pushing a corner of a building sideways with a known pressure) All cost, close to zero benefit.
• Few builders exceed 100 units per year, and most is done outside, in the weather, with close to zero QC, by indifferently skilled hammer hands (drug-tested, if you're lucky). Contrast that to the build regime for boats, aircraft, caravans and portable structures: indoors, tight QC, tight tolerances, done in volume and serial-numbered/guaranteed. Spot the difference? Check a local build, and count the weeks the frame stands outside, unprotected, in the rain...

I've touched on only a few of the major aspects of the whole shemozzle, but perhaps y'all get some idea of why Gubmints are so reluctant to grapple hard with this tar-baby......

Auckland Under Fire

Henny Pulse, Deputy Squawker for the Associated Cluckfusters Collective, is all a’flutter about the challenges recently made to the proposed Unitary Plan.
Your humble scribe interviewed her on the background. Henny, resplendent in polished wattles and her customary bright pink legband, was positively crowing about the proposals.
‘As you know’, she intoned, ‘we already have a Plan, which includes a RUB.  It’s taken years and years and a whole lotta pellets kindly supplied by our ever-giving funders, to get this to the starting point.  We have a whole team devoted to it, the grey-leg-banded ones. We call them the ClusterFlock.  And we have a Hendependent Hearings Panel to make sure it goes through just like we want.  And there are 23,000, no wait, 23,005 new plans consented.  So the challenge is just piffle - there's no shortage of Potential HenHouses.’

Your scribe reminded Henny that the point of the challenge was that the land pricing was All Clucked Up because of the RUB, as shown by the Productivity Commissions Hextensive research.  This shows price differentials for raw urban land inside the chicken-fencing, that were around 10 times the price of the cow paddocks Outside the Caforesaid fence. Plus, your scribe boldly asserted, the assorted CluckFusters had caved to the NIMBY and BANANA types who infest the Wider Chicken-run.
Henny was quick to bounce this away.
‘Why’, she warbled, ‘there just hasn’t been enough thought given to the working poor and those who need to get their tiny claws on the first rung of the Ladder to Permanent Perchdom, not to mention laying the odd Egg or three in a Suitable Nesting-Box.  That's what those 23,005, no, wait, 23,023 new consents are all about.  Perches for All!’
Assuming the royal ‘we’, we then reminded Henny that this didn't at all address the two Unfortunate Obstacles to Affordable perches:  the fact that artificial chicken-fencerating raised HenHouse prices everywhere, and that practically every one of those 23.040 consents vould not be afforded by younger two-tooth chickens, or by those with Insufficient Chicken-feed to - er - Deposit.
‘Oh, that’, she waved an arm dismissively. ‘Well, as you will be aware, we now have a Team of Henconomists who have clucked around with this notion, subjected it to Henpirical Tests (I think that’s the phrase), and have advised us of their findings.’
‘It seems a rare phenomehen they are terming Henflation, has condemned a whole generation of hatchlings to nesting under bridges and at the top of power poles – all Elfin Safety Hazards in the Extreme.’
‘Therefore we are determined, after more, careful Henconomic Research, to put a stop to this in the Interests of the Wider Flock’.
We then reminded Henny that the rare phenomehen had already caused Nesting-Box prices, expressed in terms of years of pellets per annum, to rise way above 10 years’ supply:  in the Severely UnHenFordable range.  And what did she propose to do about That, given that there was, whodathunk, a link between Planning and Price?
‘Well, nothing immediate’, Henny replied.  ‘We have to rely on the Sage Advice of our Henconomists and Planners to get ourselves out of this’.
‘Now, sorry, must fly, there’s Perch Contest soon and I wanna be Head Hen for once’, and so she departed, leaving your faithful scribe to ponder why it was that the very same Cluster-Flock who had propelled us Into all this schemozzle, were gonna be relied upon to get us Out…..

Christchurch Old CBD Precincts' fate

Press article http://www.stuff.co.nz/business/78261803/confidence-slump-among-christchurch-landlords refers.
The Precincts idea has crashed and burned, mainly because of ECON101. The Health Precinct is there all right - but between Kilmore and Bealey - not quite where the Planners Planned, but where the private health players decided to cluster.
The Justice precinct is there all right - amply funded by the person you can see in any mirror.
The rest of the Precincts are toast, because anyone with a calculator and three brain cells can see that paying $3-400 per square per year in the suburbs, leads to higher profits than paying $6-900 in the Old CBD.
And the CCC is perfectly fixated on the Old CBD.
In so doing, it is neglecting its core objective - to Serve its Customers. And, that means wherever those Customers have chosen to locate themselves. This is an abject and serious dereliction of its duty to We, the People (and, not coincidentally, the Funders.)
CCC should be concerning themselves with servicing the New CBD ( (Sydenham/Addington/Middleton/Riccarton/Hornby/Airport arc, plus the Oxford Terrace to Bealey Ave strip and Montreal/Victoria Street), which has forged ahead, safely out of the cold dead hands of CCDU and CERA, and has thereby taken most if not all of the potential business tenancies.
 Just as Selwyn DC's IZone has eaten CCC's industrial-land lunch, the New CBD has eaten the Old CBDs'.
To be sure, the Old CBD will evolve into an interesting space over the next 20-40 years.
But this evolution will be Organic, not central-planner driven.
Because, as the article clearly demonstrates, Preferences trump Plans..

NZika virus

A new variation of a very old virus has hit Auckland. It is being dubbed the NZika. It manifests by a curious shrinking, or indeed complete atrophy, of the financial brain, but seems confined only to property owners, real estate agents, and the assorted other parasites which inhabit the property ecosystem.
It results in frenzied bidding at property auctions, seemingly without regard to income, yield or cash-flow considerations - in effect, an instant lowering of financial inhibitions. The virus has rapidly accelerated through the property-owning class in Auckland, but as the transmission mechanisms (still apparently unknown) mature, it seems to be gaining a foothold in adjacent areas, thus giving rise to speculation that it is in fact spread by intimate financial transactions.
The Reserve Bank of New Zealand has made several attempts at controlling the spread of NZika.

• It has tried an inoculation campaign, by temporarily raising interest rates so as to inject some financial reality into the afflicted subjects. However, before the results could be ascertained, it was forced to drop rates yet again on the advice of the Combined US-China Plunge Protection Team, leaving the results indeterminate.
• It has tried a Financial Prophylactic Device, being an IRD-registered and surgically inserted Cap on certain parts of the Financial property Anatomy. Early results were promising, but as with many medical and social experiments, the potential for unintended consequences is large and there are too many uncontrolled variables (not to say, Financial body parts) to be able to say with certainty that NZika has been contained, let alone diminished.
• It has been confounded by the fact that NZika seems also to have an intimate link with the land-use, zoning, consenting and other policies of local authorities. These institutions are staffed by people with zero financial brain capacity as a condition of employment, and thus are completely immune to the financial effects of whatever policy fad they embrace, and indeed, to NZika itself.
• Having regard to the foregoing, financial medical researchers suggest that local authorities and NZika form a symbiosis - a mutually beneficial relationship between two otherwise completely unrelated species.

Under these circumstances, the Reserve Bank is, apparently, considering compulsory genetic modification to local authority staffers, to confer a heightened (rather than an absent) quotient of financial intelligence.
However, and at this writing fatally, the Die Grünen Collective have barred the necessary preliminary research. They aver that local authority planning staff, like the fabled Stockton Snails, are a rare and endangered species, and that the Precautionary Principle should Prevail. Preservation of said planners, no matter, it seems, how disastrous for the millions outside the Property Ecosystem, trumps any possibility of combating NZika.
Truly, some Ecosystems are more Equal than Others....