Key to outline social housing programme in first major speech of 2015

New Zealand Prime Minister John Key will tomorrow outline his government's plans to overhaul social housing, including the sale of government-owned stock and bringing in community and iwi organisations to expand the number of homes open to needy households.

In his first major speech of 2015, Key will expand on plans to boost the nation's level of social housing, which has already seen the introduction of income-related rents to approved housing providers and reviewable tenancies, he said at today's first post-Cabinet press conference. He confirmed that will include the sale of Housing New Zealand stock that is in the wrong place or not the right size, though said it would be fewer than 22,000 houses previously said to be in the wrong place or the wrong size.

"We'll broadly be giving an indication of what we think the make up of social housing will look like and the sort of broad mix of new housing providers and Housing New Zealand," he said. "The overall focus here is to accommodate more New Zealanders in social housing."

The government has come under pressure from opposition policy parties and some community lobby groups over its plans to sell Housing New Zealand stock, and increase the level of social housing provided by third parties, and defended its stance by saying income-related rents are more important to alleviating poverty than the government simply owning property and at a much cheaper fiscal cost.

Key has previously said the cost of switching 1,000 people on to income related rents was $12 million, as opposed to $500 million to build another 1,000 houses.

"Our focus has been on getting a more diverse and fairer social housing system that works better for tenants," he said.

Key said he expects buyers of Housing NZ stock will largely be community organisations and iwi, and indicated some of that housing could be sold at a discount to encourage a better national make-up of the social housing footprint.

He defended the government's efforts to increase land supply available for housing via its Special Housing Areas, saying increasing supply was the one measure the government could take in alleviating the threat of a bubble in the Auckland housing market.

Key said the Reserve Bank hasn't proposed introducing any other tools to quell the Auckland market, but if it does it will go to the Minister of Finance, and the introduction of any new macro-prudential measures would be assessed on their merits.

(BusinessDesk)