BN/04/106
24 September 2004
Minister of Housing
Housing Issues in Wairarapa – Information for the Prime Minister’s Community
Forum on 27 September 2004
Purpose
1. On Monday 27 September 2004, you are attending the Prime Minister’s Wairarapa
Community Forum in Masterton. As requested by your office, attached is information on
Housing Issues and Achievements for you to distribute to Forum attendees if you wish.
The briefing itself provides you with information on Housing New Zealand Corporation
(HNZC) housing in Wairarapa region.
Background
2. Five hundred and forty-one Housing New Zealand properties were sold under the previous
government in 1998 to Trust House Limited.
HNZC in Wairarapa
3. HNZC has no state rental properties or a neighbourhood unit office in Wairarapa. HNZC
has no formal method of monitoring housing need in Wairarapa. People contacting
HNZC for housing in Wairarapa are advised to contact the Masterton Housing Trust. (see
below)
4. Recent discussions with Trust House Ltd suggest that the level of need in Wairarapa
remains low, with applicants being able to be housed within a few weeks of applying.
Out of scope
Sale of HNZC properties to Trust House Ltd
7. The properties were sold due to the low level of unmet housing need in Wairarapa. It was
thought that it was not necessary for Housing New Zealand to provide housing in the
region. The properties sold were in: Masterton, Featherston, Greytown, Carterton,
Martinborough, Eketahuna, Pahiatua, Woodville, Dannevirke.
Housing provided by Trust House Limited
8. Trust House Ltd is a company owned by the Masterton Licensing Trust (77.67%), the
Tararua Foundation (20.14%), the Flaxmere Licensing Charitable Trust (1.46%), and the
Masterton Licensing Charitable Trust (0.73%).
9. The sale and purchase agreement for the properties required Trust House Ltd to provide
access to rental accommodation for those in need. These services were to be provided in a
manner that not only reflected its obligations to its shareholding trusts, but also
contributed to the social needs of the communities in which the purchaser is involved.
Out of scope
Out of scope
2
Recommendations
15. I recommend that you
note that:
O
ut
Out of scope
c) the state house rentals in Wairarapa were sold by the previous government in 1988 to
Trust House Ltd.
Greg Orchard
Acting Chief Executive
3
HOUSING ISSUES AND ACHIEVEMENTS
KEY HOUSING POLICY CHANGES SINCE THE GOVERNMENT TOOK OFFICE
Major changes in housing policy since the government took office include:
Increasing the number of state rental dwellings
The government is progressively increasing the number of state houses available to rent in
areas where demand is highest. Properties are acquired through purchase, redevelopment,
construction and leasing.
Since December 1999, Housing New Zealand Corporation (HNZC) has added over 4,500
houses to its housing portfolio.
Introducing a Social Allocation System for state housing
Since 2000, state housing has been allocated on the basis of need, that is, the ability to
access or sustain suitable, adequate, affordable housing.
Nationally, about 88% of lettings are to high priority applicants.
The Social Allocation System has been a major factor in reducing inequalities in access to
housing.
Introducing income-related rents
Income-related rents were introduced in 2000 to make state housing more affordable and
responsive to individual household income and need.
Income-related rents ensure that those most in need pay no more than 25% of their total
household income in rent (up to a certain threshold). Others pay progressively more than
25% of their income in rent, up to the maximum of market rent.
More than 56,000 families (representing about 168,000 people) are benefiting from
income-related rents. As a result, turnover in state homes has decreased by nearly 60%
contributing to greater stability for families and communities.
About 98% of all new HNZC tenants qualify for income-related rents. This indicates that
state housing goes to those most in need.
About 10% of existing HNZC tenants pay a market rent. This partly reflects the previous
government’s policy of allocating state housing to the first applicants to apply rather than
on a basis of need.
Introducing home ownership opportunities
Home ownership is now within the reach of low to modest income earners through such
initiatives as the Mortgage Insurance Scheme, which supports ‘Kiwibank In Reach’ home
loans.
At 31 August 2004, 465 low to modest income families had bought homes with the help
of a Kiwibank In Reach loan underwritten by HNZC. These families did not qualify for a
home loan through normal commercial channels. The average loan was $112,279.
Developing alternative housing solutions
The social housing sector outside the government (not-for-profit, non-government
community groups and organisations and Maori) also provide appropriate, secure and
affordable housing for low and modest income households.
Funding of $63 million over four years was announced in Budget 2003 to encourage these
groups and local government to retain and extend the stock of social housing that is
available to those on low incomes or with special needs. The funding, provided through
the Housing Innovation Fund, aims to increase the availability of rental housing and home
ownership opportunities for low-income households and people with special needs.
To date, HNZC has approved seven loans under the Housing Innovation Fund. One of
the loans will enable the Community of Refuge Trust to build units to house mental health
consumers in Central Auckland. Others include housing for older people and people with
physical disabilities, one loan to a local council has been approved. HNZC is considering
a further 20 proposals— four from local councils and 16 from community-based
organisations.
Addressing substandard housing, particularly in rural areas.
HNZC’s Rural Housing Programme is a needs-based programme set up to address
substandard housing in an estimated 2,500 households in Northland, the East Coast and
eastern Bay of Plenty (NECBOP).
The Programme provides a multi-pronged response to the problem of substandard
housing, including:
an immediate response to address existing substandard housing
a longer-term response directed at building local community capacity and social
development to reduce the risk of households living in substandard housing in the
future.
Responses include providing state housing, loans for essential repairs and infrastructure
improvements, and community loans.
Budget 2004 provided an additional $4.5 million for housing assistance benefits for rural
communities in 2004/05. This will improve the health and safety of 285 households
through the provision of suspensory loans for essential and infrastructure repairs.
Community Group Housing
HNZC’s Community Group Housing (CGH) service exists to ensure community groups
and iwi working with people with specialist housing needs, gain access to the most
appropriate housing to support their activities. HNZC currently owns six CGH properties
in Wairarapa.
These are let to a range of community health and welfare service providers, including
groups who work with people with mental health issues, intellectual or physical
disabilities (four properties), provide refuge for women (one property).
NEW ZEALAND HOUSING STRATEGY
HNZC is leading the development of the government’s New Zealand Housing Strategy,
which will set out a vision and strategic direction for housing over the next 10 years. The
Strategy will outline ways that central and local government, iwi/Maori, Pacific groups
and the wider housing sector can work together to develop housing policy with the aim of
achieving quality, affordable and sustainable housing for all.
A discussion document “
Building the Future: Towards a New Zealand Housing Strategy”
was released on 29 April 2004 for public comment. About 500 people attended regional
consultation meetings, hui and fono, and over 200 written submissions were received
from a diverse range of individuals and organisations. That feedback is being analysed by
officials from a range of government agencies led by HNZC and including the Ministry of
Housing, the Ministry of Health, the Ministry of Social Development, Te Puni Kokiri and
the Treasury. The analysis will inform advice to Cabinet on the shape of the New
Zealand Housing Strategy, which is due for release by the end of 2004.
