Still, global and domestic sentiment can differ. Eric Crampton, chief economist at The New Zealand Initiative, a nonpartisan public policy think tank, says it’s “easy to see” why perceptions of New Zealand appear to have improved, particularly when the pandemic response comes to mind. But, for example, New Zealand faced a slow vaccine rollout that Crampton argues contrasted with what he describes as Ardern’s skillfully projected image.
“Eventually the disconnect here between the visionary statements she’d provide, and actual reality in delivery on those promises, became substantial,” he says, noting Ardern’s flagging support ahead of her eventual resignation. The former prime minister also faced challenges including gang violence, child poverty and rising home prices.
New Zealand does have other things going for it that mirror Australia in some ways. Murray, of Karamea, says the country – considered the most scenic among respondents to the Best Countries survey, with Australia at No. 7 – has seen a tourism boom over the past couple of decades. Data points to that sector rebounding in the pandemic’s wake, and Murray adds that because of its geographic location, New Zealand is an attractive option for people looking to get away from parts of the world prone to more conflict.
Crampton, originally from Canada, has been in New Zealand for around 20 years. He is quick to list the challenges the country is facing, ranging from immigration to the cost of living, though he also notes the relative sanity of life there.
“I think, at best, we are going mad more slowly than the rest of the world,” Crampton says. “So we're still, relatively speaking, the outside of the asylum, but that doesn't mean that there aren't crazy things here, too.”
The planning rule change that enabled places like Ralston’s family compound was a historic policy agreement in 2021 between New Zealand’s two main parties, Labour and National. Part of that policy supercharged the construction of medium-density housing —such as rows of three-story townhouses— in cities and regional centres.
However, the conservative National party, which is leading in the polls, will renege on the part of the agreement that favours concentrated urban housing. Instead, National promised to immediately unlock enough land on suburban outskirts to satisfy the next 30 years of housing demand.
“The consensus that we had was cities need to be allowed to grow up and out if you want housing to remain affordable,” said Eric Crampton, chief economist at the New Zealand Initiative, a public policy thinktank. Now, the two major parties are tilting further apart in their housing strategies, he said, with National promising to repeal other key Labour policies.
Moreover, Eric Crampton, chief economist at the New Zealand Initiative, the think tank, told me that Labour’s own failures had shaped this densification push. Many on the left were convinced that housing affordability woes partially reflected the market’s unwillingness to build and that government building therefore was required to overcome land-banking. Sound familiar? Labour’s Kiwibuild promised 100,000 new state-built homes within ten years; fewer than 2,000 have been completed.
This woeful performance confirmed what experts already knew: the real supply problem was because of rules and bad incentives, not developers’ unwillingness to build. Councils did not want to give the green light even to central government homes, as local authorities shouldered the burdens of new development without being able to fund the necessary infrastructure or to reap tax revenue. Densification thus became the default priority, creating tensions with cities.
“Locking in the positive reform we’ve seen is important,” Crampton says, “but the underlying incentives for councils to expand their housing supplies haven’t changed much. When the central government beats councils over the head to densify, councils are still incentivised to look for other ways to thwart growth.” That includes exploiting exemptions to the laws or using new powers to block homes over carbon emissions.
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