Rotorua housing shortage: Twenty-eight rentals for Koutu

Construction of 28 new "affordable" rental homes on Bennetts Rd in Rotorua is under way and on track to be finished by the end of 2025.

Construction of 28 “affordable” rental homes in Rotorua is under way and on track to be finished by the end of 2025 – and will make a “huge difference” to whānau who move in.

The Home in Place development on Bennetts Rd, Koutu, will help address the city’s “severe” housing shortage, including the “particularly strained” rental market.

The not-for-profit social housing provider received a $11.2 million grant from the Ministry of Housing and Urban Development’s affordable housing fund for the development last October.

The fund’s affordable rental pathway offers grants to not-for-profits towards building rentals intended to support people on lower incomes who could not afford market rent and either could not access or did not need public housing, the ministry’s website says.

In total, $26.6m was approved through the affordable rental pathway for 76 homes in Rotorua, the ministry said.

This included a proposal by Tauhara North Kainga Limited to develop 10 homes that were under construction and due for completion late this year.

Ōwhata Kōhanga Rākau Housing LP is developing 38 homes. The first were also expected to be finished in late 2024, the ministry said.

‘More shops... more new businesses’

Home In Place interim chief executive Bernadette Pinnell said the Bennetts Rd development was “mixed tenure” with 28 rentals and 30 properties being sold under the KiwiBuild model.

The homes would be “affordable” rentals for 25 years due to a ministry subsidy. Rents would be set at 80% of the market rate.

Pinnell said KiwiBuild model’s affordability helped people move from renting to owning a home for the first time.

Homeowners had a “better chance” of getting jobs and had better health and social outcomes due to having home security, she said.

Construction of 28 new "affordable" rental homes on Bennetts Rd in Rotorua is under way and on track to be finished by the end of 2025.

“The benefits of that tenure mix in a community is you get a different demand for services. You get more shops, more local skills, more new businesses being set up in response to this different demographic... This new development will also free up much-needed rental accommodation in Rotorua.”

Pinnell said there would be 10 three-bedroom duplexes with a garage and 48 three-bedroom terrace houses with a car park.

All dwellings would be designed to a minimum of Homestar 6-plus exceeding New Zealand Building Code insulation requirements, using water-efficient devices, controlling internal moisture and potentially using PV cell technology, she said.

Homes will provide ‘immediate relief’

A Home in Place statement said the development aimed to help moderate-income earners in essential service roles such as healthcare and education.

Rotorua had been grappling with a “severe” housing shortage, with the rental market “particularly strained”.

“These new homes will not only provide immediate relief to families struggling to find affordable accommodation but will also contribute to the long-term social and economic wellbeing of the Rotorua community,” Pinnell said.

A ‘huge difference’ for 28 whānau

A Te Tūāpapa Kura Kāinga – Ministry of Housing and Urban Development spokesman said Rotorua had a “significant shortfall” of homes that had grown over a long time.

“This development will make a huge difference for the 28 whānau who can move into new, warm and dry affordable homes.”

He said the Bennetts Rd project was accepted for funding as it delivered affordable housing “at pace in an area of significant need” and was near schools, bus stations, health services, and green spaces.

He said Rotorua had experienced strong population growth but new housing had not kept up.

Rotorua’s population grew nearly 10,000 between June 2013 and June 2023, but only 2060 homes were consented in that time – and fewer were completed, the spokesman said.

He also referenced the number of eligible applicants on the public housing register ready to be matched to a suitable property.

As of the end of July, there were 780.

The spokesman also referenced a new housing development in Ngongotahā, which is part of the ministry’s land-for-housing programme.

The Rotorua Daily Post reported last month that an independent panel approved the controversial development at 31 Ngongotahā Rd for 202 homes to be built in its first stage.

The first house would be delivered by September 2026.

Homestar 6-plus rating ‘absolutely vital’

MĀPIHI Māori and Pacific Housing Research Centre co-director Dr Karamia Muller said housing being built to a Homestar 6-plus rating was “absolutely vital”.

“This will go some way to reduce the burden of rheumatic fever and meningococcal disease Māori and Pacific whānau face.”

Muller said the organisation was focused on supporting Māori and Pacific whānau to live in healthy, sustainable and affordable homes.

“Increasing supply of housing is a goal MĀPIHI supports with affordability and sustainability being the key.”

“Rent-to-buy schemes” could also lift falling Māori and Pacific home-ownership rates.

More than 300 state homes to be built

Kāinga Ora Bay of Plenty regional director Darren Toy said the agency had finished assessing planned social housing developments in Rotorua after the Rotorua Daily Post reported in July that 110 homes previously planned for the city were being “reassessed”.

At the time, the agency could not confirm which projects would go ahead or be paused.

Kāinga Ora Bay of Plenty regional director Darren Toy, pictured in 2022. Photo / Andrew Warner

Toy confirmed on September 18 that 53 Kāinga Ora developments were proceeding, which would see about 310 additional state homes expected to be delivered by the end of 2025.

Of these, 22 developments were either being built or would be soon while 31 were being contracted with builders, Toy said.

“Our assessment process, which has focused on best value for money and areas of greater social housing need, recognises the strong demand for social housing in Rotorua and the importance of moving whānau, tamariki and rangatahi into more suitable places to live.”

Megan Wilson is a health and general news reporter for the Bay of Plenty Times and Rotorua Daily Post. She has been a journalist since 2021.