Trust House still keen on housing plan

Allan Pollard, chief executive of Wairarapa-based Trust House, said the Government needed to use the right purchasing price methodology for the planned sell-off of State houses.

The Salvation Army's decision not to buy state houses from the Government hasn't deterred Trust House from its plan to expand its social housing portfolio.

The Government plans to sell up to 8000 Housing NZ homes to community providers by 2017 starting with up to 2000 of them this year, and the Christian charity was tipped as a likely buyer.

Allan Pollard, chief executive of Wairarapa-based Trust House, said it hadn't changed its view but it did demonstrate the need for the Government to use the right purchasing price methodology.

"It's still a stumbling block for community housing providers - how the Government intends to sell these houses."

The Salvation Army, which already owns 400 houses mainly rented to elderly people, carried out research to test its capacity to become a major community housing provider, and said it showed resources would be stretched, negatively affecting its other services.

It said it did not have the "expertise, infrastructure and resources to successfully manage any social housing transfer of size".

Mr Pollard said Trust House, a registered community housing provider, had the expertise already.

"Clearly the Salvation Army has worked out it can't deal with property management assets but that is our core business."

Trust House owns 500 former state houses bought in 1999 and aims to buy up to 1500 more over the next few years, in the area from New Plymouth to Hastings and down to Wellington.

Mr Pollard said the state houses would have to be sold "at the right price" so a provider could offer an improved management service for the tenant and the asset.

There would also have to be enough excess capital that could go back into the homes, he said.

Finance Minister Bill English has admitted many of the homes are not up to standard and the cost of deferred maintenance had risen to $1.5 billion.

Salvation Army housing spokesman, Major Campbell Roberts, said the stock was in an appalling state.

"The reality is with Housing NZ that through successive governments it's really making a mess of what it's doing.

"Housing NZ has massive delayed maintenance ... from a government and management point of view, it's appallingly done so you can't leave it how it is."

Mr Pollard said this was a consideration.

"It worries me that there has been a lack of spending on community housing in New Zealand."

He said the trust would first have to work out how much money would be needed for deferred maintenance in houses it was looking to buy and the Government would have to provide a discount.

Mr English said discussions with potential buyers were expected in the next few months.