An eight-unit social housing complex in Kerikeri under construction. Photo: Peter de Graaf
Some community housing providers are left without the financial security they need to keep building after the government allocated funding to just a handful of organisations.
Last year the government announced funding for 1500 new social housing places, which are granted to community housing providers (CHPs) through the Income Related Rent Subsidy (IRRS).
CHPs borrow and fundraise their build costs, but they can only push on with their developments if they have a government contract to receive the IRRS, which tops up tenants' rent to market rates.
Of the 1500 new places, 1000 were recently allocated to five housing providers through 'strategic partnerships' to make contracting the homes more efficient.
While it was great news for those strategic partners, other CHPs were left trying to figure out where their financial security would come from, said Community Housing Aotearoa chief executive Paul Gilberd.
"Income related rent subsidies are a tremendous help to give certainty of the income stream, the funding, the rent, and that allows people to unlock access to finance," he said.
"And obviously you can't build new houses unless you have finance."
They were in a "tricky situation" with less funding available and some were already looking at other ways to offer housing, said Gilberd.
"A number of them have pivoted from income related rent-subsidised social housing, to doing affordable rental housing for older adults in particular.
"And what that basically means is that they are taking a hit, they're taking a financial hit by reducing the rent that they charge so that the rent is more affordable for the households who are living in those homes."
The chief executive of Māori housing advocacy organisation Te Matapihi, Ali Hamlin-Paenga, said some CHPs had consented land ready to go, but needed IRRS contracts for income certainty.
Developments had now stalled, she said.
"I can think of one good example ... if they were given the okay tomorrow, they could begin construction on 37 properties, but while they're waiting for discussions to be had with HUD [the Ministry of Housing and Urban Development], prices are going up on these land developments."
Hamlin-Paenga said she also wanted to see more support for Māori providers. One of the five strategic partners are Māori organisations.
"Māori need to be given those opportunities to build their capability, capacity.
"That [strategic partnership approach] signals you have to be bigger ... to be able to deliver.
"How are others going to reach that capability, if they're not given the opportunity?"
Providers have previously told RNZ they did not know how strategic partners were chosen, and that there was no application process.
The Ministry of Housing and Urban Development said while most of the homes were being delivered through strategic partnerships, there would still be "some room" for other CHPs to deliver projects if their proposals clearly demonstrated community need and could be delivered by June 2027.
The strategic partners are Accessible Properties New Zealand Limited, Community of Refuge Trust (CORT), Emerge Aotearoa Housing Trust, Te Āhuru Mōwai Limited Partnership and The Salvation Army.
They were selected based on their performance, capability, and capacity, Housing Minister Chris Bishop said when they were announced.
Nearly a quarter were in Waikato, 21 percent were in Auckland, 15 percent in Nelson, 14 percent in the Bay of Plenty area, and the other 27 percent were other priority locations.
The first homes are expected to be finished in the first half of this year, with all 1500 places delivered by June 2027.
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