Price Effects of Special Housing Areas in Auckland
Thursday, 2 May 2019
AUT City Campus
42 Wakefield Street,
Author: Dr Mario Andres Fernandez
Housing prices in Auckland have persistently increased in the last decade. To fast-track development of housing, Special Housing Areas (SHAs) were created in September 2013 and were a measure to improve affordability. It is not clear the extent of the success (or failure) of SHAs as they were disestablished in May 2017. This paper investigates the causal effects of the SHAs programme on housing prices and the implications on affordability. We used a dataset comprising more than 170 thousand sales transactions between 2011 and 2016 in Auckland. Our approach consists of a Difference-in-Difference framework where the treatment consists of tranches of land designated as SHAs. Our results indicate that the SHAs caused an average price increase of approximately 5% and did not contribute to increases in the likelihood of affordable transactions. These findings are robust across several specifications and question the effectiveness of the SHAs on improving affordability.
This seminar is co-hosted by the NZ Work Research Institute and the School of Economics at AUT University.
About the presenter
Dr Mario Andres Fernandez has been a researcher at the Research and Monitoring Unit of Auckland Council since 2016. Mario received his PhD in Agricultural Economics from Texas A&M University in 2013. Research interests are environmental, agricultural and climate change economics, applied mathematical modelling and vulnerability assessments to climate change.