18 Jul 2017

Giving sunshine a price tag

From Nine To Noon, 9:40 am on 18 July 2017

For the first time, sunshine has been given a price tag in the property market.

A home's value increases by 2.4 per cent for every hour of sunlight it gets, according to a new study by the policy research institute Motu.

Most developers understand the value of sunshine but putting a value on it opens up a new way of thinking for city planners, the co-author of the study Arthur Grimes says.

"Instead of having inflexible height regulations and setbacks and building envelopes and things like that, they can be more flexible and say 'If you're going to build a property next to another and it's going to block their sunlight, you need to pay them off."

New Zealand's planning regulations are very inflexible, agrees chief executive of the Property Council of New Zealand, Connal Townsend.

"The way that our district plans and indeed the whole RMA [Resource Management Act] mechanism works at the moment is incredibly inflexible, it's blunt and quite brutal.

"The problem with our district planning and RMA approach is site coverage and building heights are a proxy for everything. It's blanket, it's set … it's so utterly contradictory to try and achieve the targets we want to achieve."

Planning negotiations that take into account the value of sunlight have had success in Vancouver, he says.

"In some cases, developers, with the help of Vancouver City Council, have gone to other owners and said 'Okay, you don't want me to build the condo, but I've got approval under the plan so can we do some deals? Would you like a public library? Would you like a play centre?"

This "proxy" figure could be used as a guide to get the New Zealand property market moving in a similar direction, Townsend says.

The data came from observations of the sale of over 5,000 houses in metropolitan Wellington between 2008 and 2014 and was collected during the National Science Challenge 'Building Better Homes, Towns and Cities'.