KEY POINTS:
The Salvation Army has called for the Government to pour $10 billion into the housing market, saying investment in this sector should be a priority. Alan Johnson, senior policy analyst from the Salvation Army social policy and parliamentary unit, wrote a report requesting urgent action as rising house prices push home ownership out of reach for many New Zealanders, especially in Auckland.
The report said $500 million to $1 billion annually was needed for at least a decade to help rebuild the Kiwi housing dream.
Major Campbell Roberts, the unit's director, said that since 1991 governments had been largely ineffectual in supporting home ownership.
This had resulted in ownership numbers plummeting to their lowest levels in 50 years.
"You only have to look at the escalating number of social problems that are appearing in our courts to see the negative impact of this lack of investment in affordable housing is having in our society," he said.
He criticised the Government's low priority policy in housing, saying this was inexplicable considering previous governments' investment in this crucial cornerstone of social wellbeing.
The report, Rebuilding the Kiwi Dream, says the Government should establish a new housing commission, a state-owned enterprise separate from Housing NZ, to handle the management and allocation of funding from the Government's new housing fund.
The $10 billion housing fund should also be established to build cheap housing and provide mortgages to allow people to buy those cheap homes, the report recommended.
The Government should establish a first home-ownership programme to help at least 2000 buyers get into affordable places, the report said.
At least $1 million should be allocated annually for the development of iwi and hapu housing to address the housing needs of rural Maori. Mr Johnson said the report was all about a return to core Kiwi values of "giving everyone a go" and caring for the vulnerable.
But Ian Mitchell, one of the country's leading housing researchers, questioned the report's findings.
"There are some challenges that need to be overcome with this," he said. He questioned the report's recommendation that the Government get into the mortgage market, saying this could be risky because it could have an inflationary impact by propelling prices up.
"Subsidised lending has a positive impact on housing affordability but it could also drive up demand," Mr Mitchell of consultants DTZ said.
A spokesperson for Housing Minister Chris Carter said some of the report's recommendations were already in train but the sums of money recommended by the Salvation Army were "pretty significant".
Call to arms
* Salvation Army recommends four new moves:
* Housing Commission established to administer $10 billion fund
* Housing Fund set up holding $10 billion from the Government
* First-home ownership programme launched to help 2000 people
* $1 million annual funding allocated for iwi and hapu housing
