The FINANCIAL — Middle income families would still struggle to afford their own homes under Labour’s KiwiBuild scheme designed to solve the country’s housing crisis, says a Salvation Army senior policy analyst.
Housing affordability was reaching crisis point in New Zealand and was a complex issue that did not have just one solution. New Zealand’s building costs were 30% higher than Australia’s and some new developments were taking up to three years to process through local councils, according to the University of Auckland.
Government had to take action as developers were unable to make money from building affordable homes and refused to take them on, said Phil Twyford, Labour MP.
He said the cost of preparing raw land for development was “extraordinary” and had to be addressed.
“There is a crisis in the housing market. Just 5% of new builds are in the affordable bracket. The country needed more manufactured, prefabricated homes and Labour’s KiwiBuild scheme would provide 10,000 new homes each year for ten years. It’s the biggest public building programme in over 50 years,” Twyford said.
"Greens supported Labour’s housing policy but said it would need to stretch further to assist families that simply could not afford a mortgage," said Metiria Turei, Green Party Co-leader. “It’s not just about people at the low end but people in the middle are finding it hard to own homes as well,” she added.
Turei outlined the Greens’ plan to set up a progressive ownership scheme involving shared equity, where a family rents their home but pays extra each week towards owning the house.
“There is no mortgage so there is no debt. It was based on previous successful schemes, such as a state-run home loan scheme for Māori that was scrapped in the 1980s. That hasn’t existed in our country for a long timem,” she added.
Johnson said "Governments needed to provide affordable homes but also ensure there was assistance to make the schemes sustainable and affordable in the long term. Simply saying “here’s a house, get on with your life” without helping families manage debt could lead to other much bigger problems. Some level of pastoral care as well as programmes to assist is what you can learn from history,” said Alan Johnson, author of the 2012 state-of-the-nation report The Growing Divide.
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