Kiwibuild could underwrite rental and social housing

Phil Twyford
Photoshopped image? Credit: Pixy

No I am not making this up and no, it is not April 1st, although every day is April Fools Day with this government.?Stuff?reports: quote.

It’s been suggested the Government might be better off using some of its?KiwiBuild?houses for social housing and rentals, as its opponents?ramp?up criticism of the building?programme.

Economist Shamubeel Eaqub says the number of first home buyers who could afford to buy one of the 100,000 houses that KiwiBuild hopes to build?over a decade, were slim. end quote.

Wasn’t Kiwibuild intended to help all those low-income families that were ?locked out of the housing market? by those mean, nasty, ugly Nats, as Labour, in opposition, constantly screeched across the house? quote.

“You have to have the deposit and you have to have the income to repay the mortgage. We knew this was always going to be a problem, particularly in the expensive areas.”

He said either the Government needed to lower the cost of entry or put the houses to some other use. end quote.

Either way, the taxpayer is going to be subsidising housing for someone. If prices are lowered, (which looks likely, after some ballots fell well and truly short) then the taxpayer is subsidising middle-class young couples to buy homes they could afford anyway. We are already seeing this. If some of these properties are turned into social housing, then they will be very expensive social houses. The long-suffering taxpayer foots the bill either way. quote.

It could supplement the housing supply by providing new rental housing or more social housing outside state housing. end quote.

So they will be social houses, but not social houses. They will be state-owned, but not state houses?

My head hurts. quote.

He said Wellington City Council had already taken that lead by announcing last week that it would partner with private owners to provide 350 rent-controlled apartments with?multi-year lease options.

Eaqub sad it made sense for the Government to underwrite rental housing. The accommodation supplement was a huge cost, and if those on the supplement were put into inflation-indexed government?rentals, it could?gain some control over those costs. end quote.

Overseas, this type of social housing is usually managed by charities or community groups. If you remember, the previous government tried to encourage the Salvation Army to run some low-cost housing, but they declined. How much do you want to bet they will reconsider, now that the Tories are out of power? quote.

“These are the kind of programmes they’ll have to do if they really want to increase housing supply and reduce this?uncertainty of who’s going to be the end?buyer.?We don’t have institutional landlords in New Zealand yet.” end quote.

No, and this government is driving out private landlords in droves.

So it turns out that most of these houses that were supposedly being built for low-income families are too expensive or not in the right areas, so they are either going to be sold to well-off people, or sold to institutions to create a special class of social housing, or turned into government-owned social housing. Good job, Phil.

It is clear that there is a need for more social houses, but this is not the way to do it. If the developers had been given the brief to build social houses, they would have come up with cheaper alternatives, or at the very least, they would have built more houses within the same area, thus reducing costs to taxpayers.

The problem here is that the government has really fouled up on this one.No one wants their Kiwibuild houses, and so they are going to have to turn them into ghettos social houses… and all at the expense of the taxpayer.

Photoshopped image credit: Technomage