Enabling housing and the longer term

Right now, there's bipartisan consensus on the Enabling Housing Supply legislation that basically abolishes single family zoning across most urban centres. 

I hope that that consensus survives the National Party's current leadership turmoil.

While Labour has the votes to just pass the thing on its own, bipartisan consensus matters in setting longer-term expectations. And I worry that National pulling out from the thing could bring about the kinds of development that the legislation's opponents feared all along.

Suppose everyone expects that, because there's consensus on the legislation, it is politically durable. It will stick across changes in government. That sets expectations about ongoing development priorities, infrastructure needs, and the kinds of housing that's worth developing. 

There's a housing shortage and a building boom currently. With the legislative change, townhouses will be allowed everywhere. But if you slap something together in a hurry that isn't great quality (but still meets code), you shouldn't expect much buyer interest. They'll know that more houses are coming. And they could just wait for one that doesn't suck. 

Developers will know that and optimise accordingly.

Now suppose instead people expect a 40% chance that the legislation flips in 2023 and a 60% chance it flips in 2026. Under those incentives, you might want to rush to have things all signed off before any potential legislative change that would thwart you. You might at least want to get projects started, so that they'd be in ahead of any legislative change, on expectation that they can't retrospectively require that started projects need consent to finish. 

And that risks getting you a bit of a mess. Projects will start where they can get going in a hurry, rather than where they might make more sense if developers knew they'd be competing also against the new homes that buyers would be expecting to come on-stream after 2023. 

Or another way of thinking about it. Suppose you expected that, after the election, import of all non-electric cars would be banned. Do you maintain or lower the standards of cars that you might want to rush into the country ahead of the ban?

And if that happens, and it's all a consequence of short-term incentives provided by the prospect of a hammer coming down, nobody will see that that's what happened. They'll just blame liberalisation and work to stop its ever happening again. 

Anyway. I'd said on Twitter that I don't care about anything in the National leadership race other than that cross-party consensus on the Enabling Housing Supply legislation is maintained. I just can't care about the internal faction stuff. I hate soap operas. But it would be nice if they didn't wind up breaking important stuff in the process.