Perfect storm swamping the housing crisis

The housing crisis is going through a “perfect storm” and is likely to worsen over the next year, a post-election briefing to the Housing Minister says.

The Hon Megan Woods has been told historically low-interest rates, a stalled private rental market and not enough new houses are drivers of the housing crisis.

An increasing population due to Covid-19 border closures is partly to blame and a “more measured immigration policy” which is aligned to New Zealand’s capacity to build more housing is needed, says the briefing paper.

The Salvation Army, which researched and delivered the paper, is calling for eight policy reforms.

These include the government addressing the impact of the Reserve Bank’s monetary policy, implementing some form of capital or wealth tax and partnering with NGOs to provide social and emergency housing.

A review of the operational and financial sustainability and effectiveness of the government’s housing provider Kāinga Ora should also be undertaken.

Salvation Army’s social housing director Greg Foster said the demand for housing was huge, but there was no supply.

“We just opened 22 units in Westgate about a month ago and we’ve had hundreds of people applying for those 22 places,” he said.

“This storm is entirely the creation of poor housing policies of the past as well as related monetary and fiscal policies of the present’, he said.

Foster said the organisation could not see an end in sight to the crisis and expected things to worsen for at least the next 12 to 18 months.

“Rents and the price of affordable housing are likely to continue to rise faster than incomes, and the social housing waiting list will grow longer still.”

Foster is concerned a generation of young New Zealanders could be scarred by their current experiences of poor and inadequate housing.

“The Salvation Army has built over a hundred social houses in the past 12 months and will be building more in the next 12 months with the support of the government.

“Nonetheless, I feel that they need to do even more to support the sector to build more social and affordable housing at this time.”


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