Zoning reform and state-developed housing in Auckland

Zoning reform is often characterized as a market-enabling response to housing shortages and unaffordable housing. Regrettably this framing belies the potential for zoning reform to encourage state-developed housing, as upzoning enables both private and government developers to produce more housing with less land. A recent zoning reform in Auckland exemplifies this point. The proportion of housing starts issued to government-controlled institutions has increased from 3.1% over the ten years prior to the reform, to 9.9% over the six years after. Proportions this high were last seen in New Zealand prior to the 1980s economic reforms that substantially reduced state intervention in the economy. A synthetic control for Auckland suggests that the reform generated a threefold increase in state-built dwellings. These findings suggest that zoning reform can enable both the market and the state to construct more housing.