Auckland City Council and the Gubmint are having a hissy fit.
ACC has overplayed a weak hand in any case.. They are infested with Brit-style Town and Country Planning Act 'planners' (the Brit's motto - we Finish what the Luftwaffe Started), who have not the slightest notion of economics, development cycles, affordability or the other aspects which, on the ground, determine what is built, where, when, and for how much. Planners are expensive in themselves, and they certainly add cost to the development cycle, if only via the injection of Time to all processes.
The build-out of the major world cities of yore was, in many cases, following infrastructure provided by private speculators, but with Gubmint incentives. London's tube (John Lanchester 'What we talk about when we talk about the Tube' is a useful primer here, as is Kunstler's 'Geography of Nowhere' for the USA scene. Development followed the lines (tubes in London, horse trams, electric trams, buses in the US). The London tubes were private companies (and at each other's throats) until the early 1930's.
I'd point to another Gubmint aspect which is a significant contributor to housing unaffordability: regulation and licensing. Examples:
- Scaffolding (a recent and extremely expensive requirement)
- LBP - at least 5 licenses for various bits of a building = downtime, overheads, cost
- fencing and worksite safety in general - way out of kilter in terms of cost/benefit ratios. Ask an older tradie.
- tool certification (at least the battery-powered kit is proof against this madness - for now)
The question is, of course - how much benefit is actually derived from this very significant cost (I'd estimate not less than 10% of build, could easily be twice that)? Again, the older tradition of craftsmen builders has little patience with all of this: they operated in a time when one built Up to one's reputation, not Down to some Code.
The Christchurch earthquakes give us an answer.
I estimate that 70% of residential builds were done in a time when regulation was absent (pre 1950's), light (to 80's), or at least sensible (to the mid-90's).
No-one was killed by bad build structures in residences, once one excludes URM, chimneys and exogenous sources (rockfall etc). Structures twisted, tilted, and cracked. But they did not kill their occupants, in a 2+g vertical acceleration sequence.
So the 'old', lightly regulated practices and their built results, have withstood probably the most severe test Gaia could devise.
Modern codes add cost but little to no incremental benefit, compared to these.
And more cost = less affordability. It's as sad and as simple as that.