“Fall In Building Caused By Credit Restraint”

Press, Volume CI, Issue 29799, 16 April 1962, Page 14

“Fall In Building Caused By Credit Restraint”

(From Our Own Reporter)

WELLINGTON, April 15. The belief of the Minister of Housing (Mr Rae) that the declining incidence of building permits being issued meant that the shortage of housing was being overtaken was questioned by the president of the New Zealand Timber Merchants’ Federation (Mr E. W. D Unwin) “I would suggest that the decline may have been brought about by the general credit restraint rather than by diminishing ■ housing needs,” said Mr Unwin. “This view is strengthened by the serious decline in permit values for commercial building in recent months. “Nobody would seriously suggest that the shortage of industrial and commercial building is being overtaken, even though there has been this serious falling off in permit issues. I think it much more likely that credit restraint is the basic cause,” he said. “The Minister is reported as saying that the shortage of houses was being overtaken. This statement has been made repeatedly over the last few years. To my mind the conclusion is that, in spite of the high level of house-building in recent years, the problem is still with us.” Mr Unwin said that in his view there was only one way to determine the present and future needs of the nation This was the institution of a full national housing survey on a regional basis. This should be accompanied by a firm indication from the Government on the implementation of immigration policies, and other factors which could affect housing targets “The important thing,” Mr Unwin added, “would be for this survey to be examined and acted on by an expert body not under the direct control of the Government. Such a body exists in the National Housing Council This council should lose no time in meeting and examining the position in terms directly related to housing needs.”

Mr Unwin said that in 1953, the national housing conference. probably one of the

most representative and effective conferences held in New Zealand, had agreed that the number of houses required was 20,600 a year during a 10-year period. The conference had recognised, however, that this target could not be immediately achieved, and had agreed that it would be necessary to increase to possibly 25,000 houses a year by 1963 An annual increase of 800 was considered likely after that year.

The conference had also made it clear that the estimates were conservative and that not less than this programme would be necessary to house the nation to accepted standards within the 10-year period. A comprehensive survey every five years was also stated to be desirable. “The actual number of completions during 1954-61 inclusive was 156,800 houses,” said Mr Unwin. “I would think that completions for the year ended March 31, 1962, would be about 24,000 That means that of the 10year target of 206,000 houses, just under 181,000 have been completed in nine years, leaving about 25,000 to be built during the year ending March, 1963, if the conference target is to be met. “I know that in 1957 a

sub - committee of the National Housing Council recommended a reduction in the original target. That recommendation was rejected by the council, as the executive took the view that, while there was a known housing need, as many houses as possible should be built to meet that need.” Mr Unwin said. Commenting on Mr Rae’s remarks that new building records had been established in some areas in the last 12 months, Mr Unwin said: “This is excellent. It appears to refute the claim that the building industry is overcommitted.” He said he believed the present over-all decrease in permits to be at the rate of about £l6 million a year, or nearly 18 per cent, of 1960 issues by value. “Certainly there will be building records," Mr Unwin said. "The first six months of 1961 showed an increase in value of £4,500,000 in building permits, and that is being reflected now It is the last six months which give concern, as they showed a drop of more than £8 million by value in permits issued. That is a pretty hefty drop to industries geared up to full and efficient production.”