A veteran of my trade, who now makes a better living promoting the interests of an Auckland local body, looked me in the eye the other day and said the city was running out of land.

He said it in that matter-of-fact way of people who have subscribed to a point of view without ever really thinking about it. When I stared back in amazement and stated the obvious - there’s plenty of land in every direction - he smiled and changed the subject.

He started to describe his home - a nice rural block of native bush on a secluded beach, quite a drive from downtown Auckland but it was certainly worth the travelling time when you got home in an evening to the trees and the tranquillity. He had a boat in the bay and at weekends it was bliss.

He hadn’t changed the subject at all, of course. He’s too smart for irony to be unintended; he was conceding my point without committing a heresy against today’s creed of urban planning. Everybody in local government these days will tell you cities are reaching the limits of available land.

Land zoned for suburban housing they mean, and they do the zoning. It’s entirely their decision that we are running out of land. They have decided that not many more of us should live in the loveliest places, such as secluded bays far from the city centre, or the cheapest places - new subdivisions beyond the built edge. That is urban sprawl and cities are no longer allowed to sprawl.

Sprawl is said to be uneconomic for reasons I have never quite understood. Services such as roads and drains have to be extended, but they must also be expanded when more people are packed more densely into designated zones. The idea that apartment dwellers will not want a car is an urban planning fantasy.

In any case, it cannot be hard to ensure that newly subdivided sections beyond the city limits carry the full cost of servicing them. The cost to first-home buyers would be less, I’d wager, than the price they must now pay for a restricted supply of residential land.

Property prices have rocketed by fully 50 per cent in the past five years, far exceeding the growth of incomes over the period. After a pause early last year, the boom seems to have resumed. A survey lately found the median house price in Auckland is now nearly six times the median income. Young people hoping to buy their first home must be looking at mortgages that would terrify me.

Their plight has prompted repeated reports from a new one-man policy think tank, David Skilling’s New Zealand Institute. It has become the subject of numerous features in newspapers and magazines and it is likely to bring some sort of Government response in the Budget next month. But all the solutions suggested so far - subsidised savings in various forms - would merely fuel the fire.

House prices are unlikely to return to affordable proportions until the discussion ceases complaining about the cruelties of the market and concentrates on the consequences of restricting the supply of land.

I am grateful to another one-man think-tank, Owen McShane’s Centre for Resource Management Studies, who sent me a clipping from the Christchurch Press of the results of an international house affordability survey initiated by a local property developer, Hugh Pavletich.

The piece invited people to take a look at their house valuations. Though the overall figure might bear little resemblance to the market value, it said, the breakdown of land value and "improvements" (your house) could be interesting.

Back in the 1970s when many of us were buying our first home, the land was about 20 per cent of the price. Look at a breakdown now, says Pavletich, and the land is likely to be slightly more than half the total.

House price inflation has in fact been land price inflation. In the United States and Canada, which like us have enjoyed high migration and a housing boom, the split is likely to be 30 per cent land and 70 per cent house. But in the fastest-growing US cities, such as Atlanta and Dallas-Fort Worth, planners are trying so hard to strangle their expansion.

In New Zealand, says Pavletich, the land component of the cost of most new housing "should not be more than 20 per cent, where it was back in the 1970s before local government started monkeying around with land supply for irrational and ideological reasons".

The ideology is apparent to anyone who comes into contact with land use planners these days. Their titles all now incorporate the word "environmental" and they do not do land use planning any more, they do resource management. And they have definite ideas of what a community should be.

It should be small and compact. People should be able to live entirely within walking distance of all the shops and services they need and ideally their workplace, too.

If they have to travel further, for mass entertainments for example, it should be by public transport, preferably on rails.

Roads are a necessary evil, the private car is an abomination, ribbon development along attractive coastlines is to be fiercely resisted. They have drawn a line around Auckland’s existing perimeter and, but for a few vacant corners within it, they intend for the city’s next million to buy into a more intimate lifestyle within present limits.

They hope. Appealing as small-town life might be to an atavistic ideal in most of us, it is not how we choose to live. We congregate in or near cities because we prefer the anonymity of crowds, the variety and opportunities of large markets and the cultural energy so many people generate. If we can find a village within the city so much the better. If it is a village by the sea it is paradise.

I love Auckland for precisely the reasons our local government is now determined to resist. This is a place to sprawl. There are few other places in the world as blessed with coastline as sublime. Why should it be the preserve of my friend from the local authority?