Sector welcomes government funding boost for social housing

The Community Housing Funding Agency, launched last November, offers privately guaranteed bonds to New Zealand investors who want their money to go to the “social good” of building new housing for those who need it. The bonds unlock lower-cost finance for community housing providers (CHPs) to enable them to deliver homes at scale.

CHPs signed up to access finance through the agency include Visionwest, Dwell Housing Trust, Monte Cecilia Housing Trust, The Salvation Army, CORT Community Housing, and Ōtautahi Community Housing Trust.

Housing Minister Chris Bishop said last week that the Government is establishing Crown lending facilities of up to $150 million for the agency. Mr Bishop said that CHPs account for 16 per cent of New Zealand’s social homes – around 13,000 houses.

“Our ambition for the social housing system is for a level playing field between CHPs and Kāinga Ora,” he said.

“The underlying ownership of a house – whether public or private – should be irrelevant. What matters is the provision of warm, dry homes to those who need them, along with social support if required.

“We call this competitive neutrality. In some areas and for some people, CHPs are the answer. In other areas, Kāinga Ora will be the way to go.

“While KO’s borrowing is done through the Crown, CHPs currently access debt from the private market at higher rates. We have further work to do to better align KO and CHP access to, and costs of, finance.”

James Palmer, the chief executive of Community Finance, which manages the Community Housing Funding Agency, said the Government’s support was a watershed moment for the agency, and for community housing in New Zealand.

“It provides our country with the platform to deliver new affordable homes at scale, helping to address chronic affordable housing shortages nationwide, with less cost to taxpayers and less Government debt,” he said.

The international norm is for community housing to be delivered at scale by charities with the support of finance through a specialist financial intermediary that has government support, Mr Palmer explained.

“. . . [W]e are no longer the international outlier, and we are excited at what this will be able to deliver for New Zealanders.”

FULL STORY

Government support gamechanger for community housing finance agency (By Miriam Bell/The Post – subscription required)

Reducing debt financing barriers for Community Housing Providers | Beehive.govt.nz (Beehive.govt.nz)