Rotorua needs to build more than twice as many houses a year as does now to get on top of the homeless problem. Photo / Getty Images
Rotorua needs to build 667 houses a year - more than twice what is being achieved now -if it's to get on top of its homeless crisis, the head of Rotorua's business sector says.
Rotorua Chamber of Commerce chief executive Bryce Heard crunched the numbers and said Rotorua needed to build 667 houses a year if it was to cope with the predicted homeless demand by 2030.
Heard said it was time Rotorua stopped playing the "blame game" and realised the crisis needed "cool heads, honest appraisal and co-operative solutions".
"As of now, Rotorua is said to be 4000 homes short to meet its housing needs. If we do nothing about it, by 2030 population forecasts indicate that this shortage will reach 6000 houses."
In the 10 months to April, Rotorua Lakes Council consented 209 new houses. It's on track to consent 251 houses for the year ending June 30.
Heard said while that was up on the 170 consented the preceding year, it was nowhere near enough. He said to get to 6000 houses by the end of 2030, Rotorua needed to "lift our game" by 166 per cent.
"If we continued to build at 251 per year, we would still be 3741 houses short by the end of 2030 ... We are just treading water and all other things equal, the homeless situation could be as bad in nine years as it is now."
Rotorua Lakes Council has said it has major plans in place to address the housing shortage, encourage new development and help make the consenting process easier for developers.
Heard said according to Stats NZ, the average number of houses consented nationwide for the year ending June 30, 2020 was 7.6 consents per 1000 people.
Rotorua has a population of about 75,000 and in 2020 built 2.3 houses per 1000. This year Rotorua is running at 3.3 per 1000.
"To build 667 per year, we would be building at the rate of 8.8 per 1000 of population. This is not impossible. Auckland built at the rate of 8.5 per 1000 last year."
This week the Government's public housing agency, Kāinga Ora, announced it had bought the empty 2ha site on the corner of Ranolf St and Malfroy Rd with the intention of building a range of homes for those most in need.
It hasn't disclosed how many homes would be built but a previously planned development on that site was going to have 50 lots.
Heard said Rotorua couldn't rely on the Government to build all the homes and a local solution was needed.
"This Government's treatment of landlords with the introduction of their new capital gains tax and removal of deductibility of interest costs is bizarre and unhelpful for anyone – least of all the homeless."
He said landlords built 48 per cent of the new houses New Zealand needed and attacking them financially only reduced the new builds adding to the housing shortage, keeping property prices high and rental costs up.
He said there were three ways to tackle the problem. Firstly, every piece of land must be made available for new builds and subdivisions and council policy needed to support this.
Secondly, Rotorua must move swiftly to convert older single dwellings on quarter-acre sections into multi-unit dwellings.
He said consenting needed to keep pace, especially resource consenting, to address the lower-cost end of the market.
The third move is to convert empty spaces in the central business district into flats, apartments, parking lots and inner-city living.
He said most of the infrastructure was already there for this and the second solution.
"When you look at it through this lens, there is real hope and ample practical solutions available. What is holding us up?"
He suggested the hold-up was possibly Nimbyism, lack of a brave plan for the central city and a requirement for speedy policy-making and consenting.
"Let's all stop playing the blame game and get to work on it."
Rotorua MP Todd McClay said Rotorua hadn't built houses at the rate it needed to. He pointed to Stats NZ figures that showed Rotorua lagged behind other areas in the region.
In the year to April, Rotorua consented 236 new homes compared with 326 in Taupō, 1585 in Tauranga, 623 in Waipā district and 514 in the Western Bay of Plenty.
"The number of developers who have come to me who are frustrated with delays is growing. They are getting frustrated and are walking away."
He said Taupō's council was smaller but the rate at which it issued consents was significantly greater. In the past four years, Taupō has consented 1209 homes and Rotorua 758.
"Almost all town and cities around us are building at greater rates so that suggests to me it is more to do with processes. Is it stormwater or wastewater struggling because of a lack of investment?"
McClay said Rotorua needed to "go ask Taupō how they do it, they seem to be doing quite well".
Rotorua Lakes Council was asked if it was investing extra resources to speed up consenting processes, what it was doing to attract developers to Rotorua and whether there was a plan to convert empty central city buildings into apartment living.
A communications spokeswoman listed a range of projects the council was involved in to improve the city's housing issues, including the Housing Strategy which it was working on in partnership with iwi, the Government and other agencies.
She said a development support manager's role had recently been created to support developers through council development processes, including consenting. The role also focused on connecting developers, landowners and technical capability to ensure development opportunities happened.
She said work on the inner-city strategy was also under way, which would encourage accommodation and residential development in the central city.
The Long-term Plan consultation document said this encouragement could be in the form of a rates remission to "incentivise development" into certain parts of the CBD. It could also mean the creation of zones to specifically encourage development of office space and retail in some parts while accommodation and residential living could be in others.
The spokeswoman also pointed to work under way in the Draft Economic Development Strategy Framework, including building investment and development confidence in the CBD through an Inner City Plan and targeted incentives, partnering with major investors, developers and the Government.
The council didn't directly respond to a question about whether it thought building 667 houses a year was doable or McClay's criticisms that Rotorua was lagging behind other areas for building consents.
In response to McClay's suggestion stormwater and wastewater were struggling because of a lack of investment, the council spokeswoman said investment in infrastructure upgrades including wastewater, roading and stormwater was under way.
She pointed to the draft 30-year infrastructure plan that would be adopted alongside the 2021-31 Long-term Plan which planned to invest $424 million into core infrastructure across the next 10 years that would "ensure safe, reliable infrastructure that was able to meet current demand and support future demand and housing development".
Bay of Plenty Regional Council's consents manager Reuben Fraser said it had invested additional resources to ensure smooth processes when people were applying for resource consents.
This included making two current fixed-term positions permanent roles as part of the Long-term Plan to help increase the workloads.
Waiariki MP Rawiri Waititi said the Government needed to be prepared to support all parties involved to speed up the consenting process.
"The Government's intention of building 190 public houses in Rotorua over the next three years simply isn't enough. We will be putting on pressure to get this number increased as they have an obligation to get people into homes. Particularly so in regions that have felt the effects of the Covid-19 pandemic."
Labour list MP Tāmati Coffey of Rotorua said until all families had a warm, dry home it would never be enough.
"But we are making progress on the housing crisis we inherited and this number [190] reflects that.
"It's important to note that number is just from builds of state housing options. We are addressing the housing crisis on many fronts. We also have the progressive home ownership scheme, $3.8 billion worth of funds to support laying the infrastructure for local developments, the overhaul of the RMA to support more housing builds and our record investment in Māori housing and papakāinga from Budget 2021."
Coffey applauded Heard for his suggestions.
"There are plenty of other options out there from this Government and while we are consistently looking for more, what we need is for iwi, council and communities to come forward with their housing ideas, and that's what the chamber is doing for the first time. I welcome them to this conversation and look forward to working with them."
Housing and Urban Development engagement and communications manager Dennis de Reus said the 190 houses promised by 2024 was the minimum number of homes Kāinga Ora expected to deliver in Rotorua, but the intention in the Public Housing Plan was to have 450.
He said this was in addition to the 85 extra homes expected through the 2018 Public Housing Plan.
"This would be supplemented by public housing from Community Housing Providers and, given the significant need in Rotorua, we would also look to bring on additional public housing from Kāinga Ora where there are opportunities to do so."
De Reus said a one-size-fits-all approach didn't work and the ministry was taking a placed-based approach to address housing needs in Rotorua.
"We are working with Kāinga Ora, Te Arawa iwi and Rotorua Lakes Council and other agencies to develop and implement joined-up solutions. This includes supporting the development of the Rotorua Housing Strategy and key actions it identified, including enabling the market to deliver significantly more housing."
He said property development and new builds would be exempt from the interest limitation rules recently announced by the Government and new builds would be subject to a five-year bright-line test, rather than the 10-year test.
The Government has no concerns about the development on state land in Ngongotahā.