Hon Bill English

Minister of Finance

Hon Dr Nick Smith

Minister of Housing

16 May 2013

Housing package improves affordability, access

Budget 2013 contains an ambitious and comprehensive package of measures aimed at making houses more affordable and improving access to social housing, Finance Minister Bill English and Housing Minister Nick Smith say.

“Too many New Zealanders have to spend too much of their incomes on housing, and that’s bad for them and for the economy,” Mr English says.

“High housing costs contribute to New Zealand’s indebtedness and create growing demand for state housing assistance. In addition, rising house prices affect financial stability and put pressure on interest rates and the exchange rate. This Government is determined to address the factors that make New Zealand houses so expensive to build and buy,” Mr English says.

Dr Smith says: “The Government will work with councils to create accords aimed at improving housing affordability by increasing land supply and streamlining planning and consent processes.”

The first accord has been agreed with the Auckland Council and the first special housing areas are expected to be designated later this year.

“These steps address concerns around land supply raised by the Productivity Commission in its 2012 report into housing affordability,” Dr Smith says.

The Government is also undertaking major reforms in social housing, including opening income-related rent to non-government community housing providers, extending reviewable tenancies to ensure those with highest housing needs have priority, and taking a more holistic approach to housing needs assessment.

“These changes build on the recommendations of the Housing Shareholders Advisory Group’s report and will deliver better results, greater fairness and better social outcomes from the Government’s significant investment in housing,” Dr Smith says.

Budget 2013 measures to improve housing supply and affordability include:

• Introduction of the Housing Accords and Special Housing Areas Bill, which will enable the Government to work urgently with councils on streamlining resource consents for new housing developments in areas of poor housing affordability.
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• Introduction of the Social Housing Reform Bill to extend income-related rents to community housing providers, transfer the housing needs assessment process to the Ministry of Social Development, and provide for reviewable tenancies for all Housing New Zealand tenants.
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• A record $2.9 billion investment by Housing New Zealand over three years. This includes:
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o $1.6 billion on new housing developments and repairs to Canterbury properties.
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o Project 324, which will put 2,000 extra bedrooms on existing houses.
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o 500 new infill two-bedroom homes on existing land.
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o Completing around 46,000 home insulations.
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o Major earthquake upgrades and repairs, including the repair of 5,000 state houses in Canterbury and the building of 700 new ones.
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• The development and trial of a Housing Warrant of Fitness. It is intended that this will first be applied to Housing New Zealand properties and then to other social housing providers. Policy work will be undertaken on applying the WoF more widely.
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“This is an ambitious package of legislative reform and investment to address New Zealand’s housing needs,” Dr Smith says. “It will deliver more homes at more affordable price as well as ensuring smarter use of the Government’s considerable investment in social housing.”

ends

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