Why the housing affordability crisis will continue

by Krizzel Canlas17 May 2018

Houses will remain unaffordable for first-time buyers and those on lower incomes if the problems in housing shortage remain, says the Real Estate Institute of New Zealand.

According to REINZ chief executive Bindi Norwell, there is a significant housing shortage across New Zealand, and the Auckland shortage is around 60,000 properties alone. A solution to this problem is essential in order to help reduce the shortage and drive housing developments forward.

Norwell said part of that solution needs to include a programme that will ensure houses can be built quickly to keep up the demand.

“There needs to be less red tape for local councils and developers to deal with and we need to build warmer/drier homes than we’ve seen in the past,” she said. “Significant funds need to be invested in the KiwiBuild programme, as it is the obvious solution to the problem.”

REINZ said one way to build houses more quickly is to include high quality, prefabricated homes and building processes as part of the KiwiBuild programme.

“Additionally, we need more investment in social housing. In terms of the ‘social’ aspect of housing, homes need to be:

  • Affordable – in order to ensure first-time buyers are able to enter the market as homeownership is at its lowest point in 60 years
  • More flexible – to meet the demands of the population and to respond to the changing dynamics in family sizes such as providing variety across smaller and larger homes
  • Readily available – especially for those who need social/emergency housing requirements,” it said.

REINZ also says New Zealand needs enough people to be able to complete the Kiwibuild programme and end the housing shortage.

“Whether that is in the form of a ‘KiwiBuild visa’ or some other initiative, it is imperative that Labour’s immigration targets don’t impact the speed with which we build houses, as in the long run, this could end up hurting New Zealanders as our housing costs continue to remain unaffordable for first time buyers and those on lower incomes,” says Norwell.


Related stories:
Property sales hit a record high, REINZ
Prices climb in the regions whilst cities 'pause for breath' 


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