Community housing providers will be able to borrow money at a cheaper rate as the Government pushes social agencies to build more homes.
Reforms that would allow the fast-track of medium-size greenfield developments were also announced today.
Housing Minister Chris Bishop revealed the Government would provide $150 million for lower-cost debt in a speech to KangaNews Debt Capital Markets Forum in Auckland on Thursday.
Government housing agency Kāinga Ora had an arrangement to borrowd through the Crown which gave it a competitive advantage, compared with community housing providers which borrowed through the private market, he said.
Community housing providers supplied long-term public rental housing, and include registered private businesses, charities and councils.
The Community Housing Funding Agency (CHFA) was launched by Community Finance last year as a way of pooling finance requirements for CHPs to provide cheaper debt.
Bishop said the funding boost for the agency would level the playing field with Kāinga Ora.
“We call this competitive neutrality. In some areas and for some people, community housing providers are the answer. In other areas, Kāinga Ora will be the way to go,” he said.
“This will lay the foundation for Community Housing Funding Agency to borrow hundreds of millions or billions of dollars, supporting not just the delivery of social housing, but also community housing providers’ broader affordable housing portfolios.
“The underlying ownership of a house – whether public or private – should be irrelevant. What matters is the provision of warm, dry homes to those who need them, along with social support if required.”
Community Finance chief executive James Palmer said it was a “watershed moment” for the country.
“To get the Government support today truly does mean we can deliver billions of dollars for vulnerable Kiwis to get a home.”
Fast-tracked greenfields developments
Bishop also announced a series of immediate reforms aimed at fast-tracking medium-sized greenfield developments, including low-interest loans for infrastructure and changes to land-use protections under the Resource Management Act.
Developers would be temporarily able to borrow money from the Government, he said.
“We’ve got these greenfield developers that are keen to crack on in the next two to three years, they need a little bit of extra support from the Crown’s existing vehicle that we know is effective at delivering these sorts of arrangements.”
Labour housing spokesperson Kieran McAnulty said the party had questions around what the reforms would mean for the council’s ability to build infrastructure.
“We want to be constructive with the Government on this stuff, so we’re going to talk to them and try and find that out and, if we can support it, we definitely will.”
