When zoning is not a constraint, development charges are paid by homebuyers in the form of higher housing prices. The tax reduces developer demand for land, which reduces the supply of housing, resulting in higher prices.
www.nzinitiative.org.nz/reports-and-...
Michael Wiebe
Michael Wiebe
🚨Land value tax alert🚨
How does LVT work in a general equilibrium supply and demand model of land and housing? It shifts down both the supply and demand for land, reducing the after-tax land price. The effect on developers is a wash, so the housing market is unchanged.
Sweet, sweet non-distortionary taxation!
worksinprogress.co/issue/how-th...
Incredible stuff happening in New Zealand.
This report proposes a legal framework where going over an objective threshold of housing scarcity (a premium on higher-density land prices) would trigger *automatic* upzoning.
Misconception: development charges are paid by developers.
Fact: development charges are paid by landowners (and by renters and homebuyers, when they make projects infeasible and reduce housing supply).
Michael Wiebe
Michael Wiebe
Michael Wiebe
The Planning Bill 2025, introduced to Parliament on 9 December 2025, represents the most significant reform of New Zealand’s resource management framework since the Resource Management Act 1991. Among...
