Are our Metropolitan Centres About to Become Super (Sized) Metropolitan Centres? Minister Explores Relaxing Unitary Plan Rules. Also KiwiBuild

Minister plans to relax Unitary Plan rules

Also: KiwiBuild eligibility

 

Yesterday in a KiwiBuild summit the Transport, Housing and Urban Development Minister (the Minister of THUD) dropped this surprise to the attendees:

 

Essentially what the Minister is doing is either looking at a National Policy Statement or National Environmental Standard under the Resource Management Act (for which the Auckland Unitary Plan sits under) to compel Auckland Council to have their Planning match the requirements of those statements. In this case the Unitary Plan would need to have all height limits removed out of the Metropolitan Centres (given all of them do or will sit within transport nodes and corridors) while any area with housing within 800 metres of a transit station or Line will need height and density controls removed (Terraced Housing and Apartment Zone, and Mixed Housing Urban Zone land already have density controls relaxed).

 

This upcoming NPS or NES is great news and what I have pushed for recently in terms with urban areas near transit lines/stations, having the Metropolitan Centres get their height limits relaxed is something I fought for in the Unitary Plan hearing days (2013-2016) but the Planners ignored. Seems the Minister has other ideas meaning Manukau Metropolitan Centre (Manukau City Centre) can reach its Super Metropolitan Centre potential with unlimited height being available (the latest round of hotels under consenting are already hitting the daft 18 storey height limit Council imposed).

It also seems Twyford is making true to his word on Manukau being able to hold 100,000 new residents inside the Transform Manukau area. Given Manukau is the core to the rapidly growing Southern Auckland having the area with relaxed height and density controls especially so close to Manukau Station just makes sense!

Well done Minister!

 

Example of an AP2050 Node – Manukau
Source: Auckland Council

 

KiwiBuild

 

Yesterday people could start signing up for KiwiBuild homes.

From Minister Twyford:

Door opens to affordable home ownership

From today aspiring homeowners can register their interest in a KiwiBuild home, Housing and Urban Development Minister Phil Twyford announced.

“Today is a milestone in the Government’s ambitious programme to restore affordable homeownership.

“With the first KiwiBuild homes on track to be completed shortly and many more in the pipeline, we are now at a stage where the KiwiBuild Unit can open its doors and invite people in.

“People can check the eligibility criteria and will soon be able to pre-qualify for the first homes currently being constructed and the thousands more that will be built by KiwiBuild in the years ahead,” Phil Twyford said.

“All eligible buyers will have an equal chance to own a KiwiBuild home at cost price through a ballot system.”

The eligibility criteria for KiwiBuild home buyers are:

  • First-home buyers or ‘second chancers’,
  • New Zealand citizens, permanent residents or those who ordinarily reside in New Zealand,
  • Intend to own, and live in it, for at least three years,
  • Income below $120,000 for sole purchasers and $180,000 for couples.

“We know that New Zealanders at and below these incomes are struggling to buy a home, especially in high demand areas such as Auckland and Queenstown,” Phil Twyford said.

“For instance a couple of teachers may have a combined income of between $150,000 and $170,000. For a nurse and police officer earning upwards of $120,000, and for an engineer living alone, $90,000. A decade ago these families would have been able to afford a home, but they are now locked out of the market.”

Phil Twyford said this week marks the official start of the KiwiBuild programme – where homes built under the programme will count towards the Government’s official target.

“In the first year we will deliver 1000 KiwiBuild homes, with the full ramp up of production reaching 5000 homes by June 2020 and 10,000 homes by June 2021.

“This is the largest state-backed home building programme in generations. I’m proud our Government is helping the next generation of New Zealanders realise the Kiwi dream,” Phil Twyford said.

People can register their interest at www.kiwibuild.govt.nz

—ends—

 

Further Information:

FAQ – KIWIBUILD REGISTRATIONS OF INTEREST AND ELIGIBILITY

 

Registration

  1. Can anyone register for more information?

Yes, anyone can register their interest in KiwiBuild. This includes potential home buyers as well as people who simply want to receive updates about KiwiBuild.

There is a separate ‘pre-qualification’ process to determine whether someone is eligible to buy a KiwiBuild home. As we get closer to Kiwibuild homes being available for potential buyers, the KiwiBuild Unit will provide more information about this process.

  1. What will the KiwBuild Unit do with the registration information?

The KiwiBuild Unit will use the registration information to ensure people are kept up to date with the latest information about the KiwiBuild programme. The KiwiBuild Unit will also use this information to let people know when KiwiBuild homes become available that fit their requirements.

  1. Will registration details be passed on to third parties?

No. The details of people registering will be held by the KiwiBuild Unit and will not be provided to third parties.

  1. Will registering mean someone is more likely to get a KiwiBuild home?

No. A person registering their interest will receive information and updates about KiwiBuild, including when KiwiBuild homes become available. People will still need to pass an eligibility test to be considered for a KiwiBuild home.

  1. Can you register someone else – e.g. a mum registering their adult children?

Yes, anyone can register to receive more information about KiwiBuild.

  1. What do I do if someone has registered on my behalf and I don’t want to be registered?

You can unsubscribe at any time.

  1. Who can I speak to for further information or to help with the registration form?

The KiwiBuild website (www.kiwibuild.govt.nz) is the best place to go for further information. Alternatively you can contact the KiwiBuild Unit at info@kiwibuild.govt.nz with any queries.

  1. What if I don’t have an internet connection – is there any other way I can register?

If you are unable to submit the form via the KiwiBuild website, it can be posted to:

Ministry of Business, Innovation and Employment
Attn: KiwiBuild Unit
PO Box 1473
Wellington 6140

Eligibility

  1. How can people check if they are eligible?

The eligibility criteria is available at www.kiwibuild.govt.nz

  1. How will the KiwiBuild Unit assess eligibility?

As part of the pre-qualification process, people will need to provide details and supporting documentation to the KiwiBuild Unit.

If their eligibility is confirmed, they will be able to enter a ballot for KiwiBuild homes that fit their requirements, as they become available.

  1. When can people pre-qualify as a KiwiBuild buyer?

When we get closer to KiwiBuild homes being available for potential buyers, the KiwiBuild Unit will open the pre-qualification process.

More information about the pre-qualification and ballot process will be available as our programme of housing developments progresses.

  1. How did the government determine the eligibility criteria?

The eligibility criteria is broadly based around five key factors:

  • Home ownership status – KiwiBuild is restricted to first home buyers and ‘second chancers’; those people who haven’t yet had an opportunity to own their own home or who no longer own one.
  • Nationality – KiwiBuild is for New Zealanders or permanent residents of New Zealand.
  • Minimum ownership period – KiwiBuild is for people who plan to live in their home for at least three years – not for people looking to use it as an investment.
  • Intention to reside – KiwiBuild is for people who want to live in their first home – not for people wanting to use it as an investment by renting it out and living elsewhere.
  • Maximum income or assets – KiwiBuild is aimed at first home buyers who are looking to buy a modest, starter home.

 

  1. Who are ‘second chancers’?

Second chancers are people who have previously owned a home but who no longer do so, but who now find themselves in a similar financial position as a first home buyer. For instance, a divorcing couple may sell their home in order to separate their finances but this can leave both people with an insufficient deposit to purchase a new home.

Consistent with the KiwiSaver HomeStart grant, a second chancer must not have assets totalling more than 20 percent of the house price cap for existing/older properties in the area they are buying in, which is:

  • $120,000 for Auckland
  • $100,000 for Hamilton City, Tauranga City, Western Bay of Plenty District, Kapiti Coast District, Porirua City, Upper Hutt City, Hutt City, Wellington City, Nelson City, Tasman District, Waimakariri District, Christchurch City, Selwyn District, Queenstown Lakes District
  • $80,000 for the rest of New Zealand.

 

  1. Why did you set the income cap at 120k for single purchasers and 180k for couples?

KiwiBuild is about restoring the Kiwi dream of home ownership to those families who traditionally would have expected to own their own home but who are struggling because of the lack of lower-priced, starter homes available.

We know that New Zealanders at and below these incomes are struggling to buy a home, especially in high demand areas such as Auckland and Queenstown.

  1. Can KiwiBuild owners have flatmates or other people living with them that contribute to their mortgage?

Yes – KiwiBuild does not prevent owner occupiers from having flatmates or renting spare rooms – as long as the owner lives at the property.

  1. What happens if a KiwiBuild owner needs to sell the property before three years?

There may be occasions where KiwiBuild home owners encounter unforeseen changes in their circumstances, such as the death of a partner, divorce or serious illness, which means they need to sell their home.

In these cases you will need to apply to the KiwiBuild Unit, which will consider each request on a case by case basis.

  1. How will you ensure that people comply with the minimum ownership and requirement to occupy?

The KiwiBuild Unit will be responsible for ensuring that KiwiBuild home buyers are complying with the terms of owning a KiwiBuild home.

  1. Who will get the first homes – is there hierarchy?

Due to the potential for significant demand for KiwiBuild homes, particularly in the first few years of the programme, to ensure everyone is treated fairly the KiwiBuild Unit will run a ballot system. The people whose names are drawn from the ballot will get the first opportunity to buy the homes they have registered their interest in.

 

KiwiBuild eligibility criteria – Background information

The Kiwi dream of homeownership is slipping away.  Home ownership is at its lowest level in over sixty years. Homeownership rates have been falling for 30 years, down from approximately 75 per cent in 1991,[1] to the latest estimate of 62.7 per cent.[2]

Too few homes are being built, which is helping to drive up prices beyond the reach of middle New Zealand; and, of the homes being built, few are priced in the lower quartile of existing stock where over a third of first home buyers purchase their homes.

Younger generations have been the most affected. A generation of young New Zealanders who have good jobs are priced out of home ownership. They made good choices, but still can’t afford the security of their own home.  Families which would have traditionally been able to purchase a home are now locked out in ever increasing numbers.

KiwiBuild is about restoring the Kiwi dream of home ownership to those families who traditionally would have expected to own their own home and expanding that same dream to thousands of more families across New Zealand.

One of the main causes are increasing house prices

Three separate periods of high home price inflation are likely to have been the primary cause of declining home ownership, particularly in Auckland, where price rises have been highest.

Adjusted for inflation, the median priced Auckland home now costs $650,000 more than 25 years ago. In March 2018 the median house price was $851,250 up from $433,813 in March 2009. In addition to Queenstown and Auckland, other areas which have traditionally had steady house price growth, such as Whangarei, are also experiencing large growth. Since June 2015 the median home price has increased from $320,000 to over $450,000 in December 2017.

Homes are not affordable

Over the last decade the nationwide median home price to median household income ratio, (median multiple), has increased from 4.58 in March 2009 to 6.34 in March 2018. In March 2018, the median multiple was 9.5 in Auckland and 11.7 in Queenstown.

Only Whanganui and Invercargill achieved the international affordability benchmark of three times the median income.

Younger generations have been the most affected.

Overall, only a quarter of adults under 40 own their own home, compared to half in 1991Home ownership has declined for all age groups but most acutely by those under 40 years’ of age.

Source: NZ Government

A broad range of households have been locked out of home ownership

It is a sign of the severity of the crisis that young, professional couples remain locked out of home ownership. Some of the biggest declines in home ownership have been for families earning between $97,600 and $188,899.

 

Source: NZ Government

 

Eligibility criteria

The primary objective of KiwiBuild is to increase home ownership through increasing the supply of affordable starter homes for families.  The eligibility criteria for KiwiBuild home buyers is that they must be:

  • First-home buyers or ‘second chancers’,
  • New Zealander citizens, permanent or ordinarily resident,
  • Intend to own for three years and live in it,
  • Have an income below $120,000 for sole purchasers and $180,000 for couples.

First home buyers with a family income of below $180,000 will be able to purchase KiwiBuild homes.

The choice of the income cap reflects the expectation that very high income families would not be able to get a KiwiBuild home, while keeping KiwiBuild open to young families who have traditionally been homeowners but are now locked out of the current home market.

Young families with working parents such teachers, tradies, or office workers, with individual incomes between $50,000 and $90,000, can have can have a household income well above $100,000 yet still struggle to buy a home, particularly in Auckland.

The evidence confirms this:

  • The Household Economy Survey shows households in the $80,000 to $180,000 income range experienced the largest decline in homeownership in the past decade. The same survey shows nearly half of families with children fall within the $80,000-$180,000 income range.
  • 2013 Census statistics show that homeownership among families with children was declining at twice the rate experienced by households without children.
  • 2013 Census data also shows that the largest decline in homeownership was among adults under 40. Half of whom owned their own home in 1991, compared to a quarter in 2013.

The $180,000 cap excludes current first home buyers with the highest 8% of incomes, while retaining access to KiwiBuild for families who are struggling to access homeownership.

Assisted home ownership schemes

As we ramp up KiwiBuild, we are also working on a number of programmes to complement KiwiBuild and enable more families to take advantage of the KiwiBuild programme. In particular, we are investigating a progressive home ownership scheme – a joint NZ First, Labour and Greens commitment.

Reducing costs and building below the price caps

One of the goals of KiwiBuild is to use the scale of the KiwiBuild and public housing build programme to reduce the costs of building a home through our procurement practices. One example will be the increased use of off-site manufacturing. As KiwiBuild drives construction costs down over time, we will pass these savings onto first home buyers.

We are aiming to build as many homes as we can below the price caps. For example, the first KiwiBuild homes at McLennan, in Auckland, will be sold for $579,000 for a three bedroom home – $71,000 less than the maximum price cap. 

 

 

KiwiBuild sales process

Source: NZ Government

 

[1] Note that the census did not identify cases where the home is owned by a family trust until 2006, meaning that earlier census data understated homeownership.  The graph shows a range of estimates from the Reserve Bank for home ownership that included family trusts prior to 2006.

[2] As at 31 March 2018, Statistics NZ, Dwelling and Household Estimates.

……..

Source: New Zealand Government

 

Remember:  People can register their interest at www.kiwibuild.govt.nz

 

 

 

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