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The New Zealand government and Christchurch City Council want to add a net 700 social housing units in the country's second-largest city in two-and-a-half years and a bigger supply of affordable houses as part of a formal housing accord.
Housing Minister Nick Smith and Christchurch Mayor Lianne Dalziel today signed an agreement which will see central government invest $75 million and council $50 million to encourage private investment in developments. The accord, which needs ratification by the full council, is the second after the government last year introduced legislation to help alleviate housing supply shortages.
The accord's medium term targets are to increase the immediate and long-term supply of affordable homes in Christchurch and to support sustainable provision of social housing in the city. It has aspirational goals of a 10 percent reduction in the number households at the 40th percentile paying more than 30 percent of their household income on housing, increasing the proportion of building consents of less than $250,000 and to add a net 700 social housing units by the end of 2016.
"The government and the council will also be working closely together on facilitating new private sector residential investment and particularly in encouraging more affordable housing," Minister Smith said in a statement. "The accord provides for joint action on minimizing barriers to development, exploring a one-stop shop for consenting and close monitoring, and, where appropriate, amending of the Land Use Recovery Plan to address any impediments to additional affordable housing."
The levelling of much of Christchurch in the 2010 and 2011 earthquakes left a housing supply shortfall of about 12,000 which is expected to deteriorate before improving as the rebuild gathers pace. That lack of supply has driven up property values and rental prices, which along with a supply shortage in Auckland, has underpinned more expensive national housing. Christchurch property values rose at an 8.3 percent annual pace in the year ended March 31, according to state-owned valuer Quotable Value.
The government and council will set up a new entity to oversee the programme, as well as a joint housing steering group to report monthly on the residential building in Christchurch.
Central government plans to develop two villages totalling 180 homes on council-owned land, which the local body will sell at fair market value while the Crown will defer payment.
"The two inner-city developments address my particular concerns about the availability of temporary accommodation for families displaced from their homes during earthquake repairs," Smith said.
Dalziel said housing is one of council's top priorities, and has been working on the proposed accord since late last year.
"The accord is very significant in that it acknowledges the seriousness of the current housing shortage in the city and proposes a way forward," she said.