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The density dividend: smaller, worse, slower, less?

By Ross Elliott - posted Wednesday, 10 April 2024

In 2005, a UK policy group “The Policy Exchange” published “Bigger, Better, Faster, More: Why Some Countries Plan Better than Others”  It surveyed four countries with similar demand side pressures to the UK, to explore what was being done well, and what wasn’t. Australia was one of them.

"Britain’s centralised system of planning restricts the supply of housing. As a result, Britain has some of the oldest, pokiest and most expensive homes in the world," it said.

For Australia they concluded that it was “Death of a Dream: Planners versus the Traditional Australian Home”:


The Australian desire to create a home away from ‘home’ (their European roots) has led to a strong cultural preference for spacious houses with big gardens – ‘the Great Australian Dream’. Various Australian (state) governments have threatened this dream by reducing the quantity of land released for housing and by levying homebuyers to provide infrastructure. Both policies have had a strong upward impact on Australian house prices…  land-use planning has actually created a shortage of land – in a country with a population density of only 2 persons per square kilometre.

They  added:

In Ireland and Australia, with planning systems derived from the UK’s, restrictions on the supply of land, densification policies and central planning fail to provide the kind of homes people want, and lead to high real house price inflation.

They were right. Our regulatory approach hasn’t changed but we have added to demand pressures via record immigration (the main driver of population growth). Now, as if taken by surprise, we find ourselves in a “housing crisis.”

Rather than “bigger, better, faster, more” we seem to be doing smaller, inferior housing which is taking longer to deliver plus we are delivering much less of it. Why?


Urban policies which preference density over sprawl are partly responsible – and before you start poking pins into your Rossco voodoo doll, hear me out.

There are many compelling reasons to pursue higher density: a more efficient use of space and proximity to necessary infrastructure among them. My interest in suburban renewal precincts recognises that many of these potential renewal precincts historically carried more employment density than they do today: hundreds or thousands of workers used to work under saw tooth shed roofs which today store boxes or caravans and are overseen by two kiwis with a forklift.

Returning employment density to these precincts, supported by housing density and social infrastructure, means more jobs and amenity closer to where people live, amongst other things.

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This article was first published on The Pulse.

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About the Author

Ross Elliott is an industry consultant and business advisor, currently working with property economists Macroplan and engineers Calibre, among others.

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