This report is a summary of fieldwork abroad on how different jurisdictions deal with their housing markets, and the interaction between regulation, local government and building.

Key points

• Switzerland and Germany have remarkably stable prices compared to New Zealand, while Texas has had stable and low house prices for an extended period.
• The common attribute of all three markets in delivering successful housing supply are a predictable consents and planning processes, and an assumed right to build
• Britain’s planning system, which shares many centralised attributes with New Zealand, has delivered housing shortages, steep house price inflation, and smaller more urban dwellings.

Switzerland

• Switzerland’s system of competing cantons and municipalities, where revenue is correlated to population size, means services provided to citizens are price sensitive and competitive at tax level.
• Switzerland has a planning culture where planners come from different backgrounds, and must be cognisant of the political realities and the costs policies impose on current and prospective residents.

Germany

• In Germany, where real house prices have remained stable since at least the 1970s, the local government system relies on capitation grants from state governments, based on businesses and people in their area. So more people and more businesses mean greater income for local authorities.
• Germans traditionally buy one house in a lifetime. The concept of a ‘starter home’ is foreign. Home ownership is not culturally important.

Britain

• The right to develop in Britain has been virtually nationalised.
• Britain’s Town and Country Planning Act has led to an inexorable rise in NIMBYs. This is an entrenched anti-development culture, where ‘greenbelts’ around the country are considered sacrosanct.
• The government structure is highly centralised, meaning local councils get little benefit but greater cost from new developments.

Texas

• There is no zoning outside cities, so subject to environmental compliance and the provision of one’s own infrastructure, a new development can take place anywhere.
• The Municipal Utility District (MUD) was formed as a new private way for paying for this infrastructure, allowing for debt-financed water infrastructure through a tax free bond, issued off the back of value already present in the development.
• More broadly, planners in Houston see themselves as regulators rather than interested parties in town design. Property rights are strong in nature and limited in scope: they cover little more than the land itself.