Property Institute urges rethink on Social Housing Policy

Property Institute of New Zealand Chief Executive, Ashley Church, is urging the Government to review the way in which it proposes to transfer state houses to the voluntary sector following a decision, by the Salvation Army, not to participate in the program.

Earlier this year the Prime Minister spelled out plans to sell up to 8000 state houses to approved community housing providers or iwi by 2017 in order to:

· increase the number of social houses provided by either Housing New Zealand or other providers

· ensure that those houses better meet the needs of tenants

· deliver Government assistance in a way that stimulates housing supply

· help more New Zealanders into housing independence when they are capable of making that transition.

But the Salvation Army will not be taking part in the program citing a lack of "expertise, infrastructure and resources to successfully manage any social housing transfer of size".

Mr Church says that the policy has ‘tremendous merit’ but that the Salvation Army rejection should not come as a surprise – warning that the program is destined to fail if the Government presses ahead and tries to implement the policy it in its current form.

He says that social agencies will have concerns around tenancy issues, maintenance obligations and the cost of servicing loans and that these concerns will be enough to scare off the very agencies that the Government will want to partner with.

“If a large, credible, social agency like The Salvation Army thinks that the current proposal is too risky – it’s unlikely that any other group is going to be any more willing to pick it up”.

However, Mr Church believes that a few tweaks to the policy would address the concerns of community housing providers while allowing the aims of the Government to still be met.

He is proposing:

· that the Government slow down the sale program and first allow community housing providers to enter into ‘Management Contracts’ - with clear protections around property maintenance costs and unreasonable commercial risk.

· that both parties agree to a timetable for the future transfer of social housing at an acceptable price and in a timeframe within with the community providers are comfortable.

· that expertise, infrastructure and resources are shared between Housing New Zealand and community housing providers until such a time as community providers are ready to assume overall responsibility for their portfolio.

Mr Church says that these changes would give community housing providers confidence and certainty around the ‘riskier’ aspects of the program and would allow them to take possession of these properties at a time of their choosing.

“The risks would be largely removed and the Government would still achieve its social housing goals”.

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