Reaction: Extra housing 'ludicrous'

Andrew King is president of the Auckland Property Investors Association, a group of more than 500 people who own mainly houses but also some commercial property.

What the association wanted from the Budget was for the Government to stop building and buying so many new state houses and involve the private sector more in finding solutions to good housing for low-income families.

Housing New Zealand already had about 60,000 state houses and did not need more, Mr King said.

But the Government will increase its stock by 643 new state houses - 300 announced in the Budget, added to the 343 it was already planning to add next year and in 2002.

Housing Minister Mark Gosche and Associate Housing Minister Tariana Turia said yesterday that an extra $110 million worth of new capital and operating money would go to state housing during the next four years.

This would reduce over-crowding and improve housing conditions, they said.

They also announced a national refurbishment programme for 9000 existing state houses, upgrading them through projects such as Healthy Housing, a joint HNZ-South Auckland Health project to improve families' health.

"Just ludicrous," is how Mr King reacted to the decision to add 643 houses to the stock, saying it did nothing for the thousands of families in need. But he approved of the refurbishment.

The association did not want the Government to build more state houses.

"We want them to stop because economists say there is already an oversuppply of rental houses and the effect of building more will be negative on the entire market," Mr King said. "We want the Government to moderate its effect on the housing market so it does not affect the cycle of supply and demand."

But the association did want the Government to spend more money maintaining its existing state housing stock, which it said was in need of repair: "They should do this before they buy more new houses," Mr King said. Refurbishing 9000 houses was "about the right number", he said, "as long as those are the worst 9000."

The association strongly opposes income-related rents, reintroduced by the Labour-Alliance Government.

"These are a poor way to provide decent accommodation for low-income families. There are many more people in need than the government can afford to house.

"Once you are in a state house, there is no provision for you to leave as your circumstances improve. With state-subsidised cheaper rent, there is little to compel tenants to move on and make way for others in greater need."

The Government should put more effort into forming an alliance with the private investment housing sector, Mr King said.

Housing New Zealand has about 24,270 properties in Auckland and 18,400 in the South Island, with total assets of $4.2 billion.


www.nzherald.co.nz/budget

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