As the Government revealed details of a housing infrastructure fund, a UN watchdog took aim at the country's overpriced, substandard housing stock and a culture of asset speculation which has taken root
A United Nations representative has taken aim at unbridled housing speculation in New Zealand and the "astronomical" amount being spent to house Kiwis in motels, saying governments' policies have led to housing being treated as a speculative asset, rather than a place to live.
Leilani Farha, the UN’s former Special Rapporteur on adequate housing, visited New Zealand in February last year for a series of meetings with officials, civil society representatives and residents.
In her final report for the UN Human Rights Council, Farha said the country’s housing crisis was “a human rights crisis that must be addressed urgently”, with high rates of homelessness, escalating rents, and substandard living conditions just some of the problems.
“Such conditions would not have reached such a point had housing been fully understood, recognised and implemented by national and local governments as a human right and a social good rather than as an asset for wealth accumulation and growth over the last decades.”
While the Government had made efforts to prevent and reduce homelessness, it still lacked a comprehensive, human-rights based strategy, as well as a legally enshrined right to housing with effective remedies for any violations of that entitlement.
While a lack of affordable housing, a limited supply of public housing and foreign speculators had been blamed for the crisis, Farha said the roots of the problem laid in the history of New Zealand’s housing policy “almost exclusively focus[ing] on homeownership, which, in more recent years and particularly since the global financial crisis, has translated into housing having lost its function as ‘home’ – a place to live – as that concept has been replaced with the notion that housing is a speculative asset”.
“Housing finance has morphed into consumer finance. Low interest rates, coupled with an underdeveloped rental housing system with weak tenant protections, have allowed housing speculation to continue in a relatively unbridled fashion.”
"In recent years, housing for the rich was built in abundance, but insufficient housing was constructed for the majority of the people who have low or middle incomes.”
More than half of New Zealand’s $1.6 trillion household wealth was held in land and housing as of mid-2019, she said. The value of the wealth held in housing and land had grown by 91 percent, or $400 billion, over the previous decade, with 80 percent of that down to the growth in house values.
While a high number of all new builds in the 1960s and 1970s had been affordable for low-income families, by 2014 more than half of all new housing was aimed towards the upper market.
“In sum, in recent years, housing for the rich was built in abundance, but insufficient housing was constructed for the majority of the people who have low or middle incomes.”
Writing about the use of motels for emergency housing, Farha said it was an inappropriate response to homelessness given the need for social support, while the amount of money being spent was also “astronomical”.
The Government needed to provide specific support for Māori to access housing, given they were disproportionately represented among the homeless, represented 60 percent of those who received emergency housing grants and made up 36 per cent of social housing tenants.
The physical separation of Māori from their ancestral homes between 1840 and today had given rise to an ongoing state of homelessness and served as “a dark shadow that hangs over the country – a shadow that must be understood as shared between Māori and non-Māori and that cannot be lifted without a significant shift in relations between the Crown and Māori, and by acknowledging that Māori have borne the greatest harm”.
Among the report’s recommendations were that New Zealand recognise the right to adequate housing as an enforceable right in law; develop and implement a comprehensive human rights-based housing strategy; ensure there was a complete prohibition of any evictions that might result in homelessness; and reduce housing speculation by adopting a capital gains tax and limiting debt-to-income mortgage ratios.
Housing crisis 'central priority' for NZ
Responding to Farha’s report, New Zealand’s permanent representative to the UN in Geneva Lucy Duncan said the country “share[d] her view that the housing crisis facing Aotearoa New Zealand must be addressed urgently, and in a way that is enduring. This is a central priority for the New Zealand Government”.
A number of the report’s recommendations aligned with actions the Government was already taking, Duncan said. She cited the development of a government policy statement on housing and urban development, which centred on the vision that “everyone in Aotearoa lives in a healthy, secure and affordable home that meets their needs, within a thriving, inclusive and sustainable community”.
“This vision recognises that everyone has a right to an adequate home, and speaks to the broader view of housing adequacy highlighted in the Special Rapporteur’s report.”
The Government was also developing a new Māori housing strategy to “review and reset the long-term systemic changes needed to address the causes of poor and inadequate housing for Māori”, she said.
Discussion of Farha's report in Geneva came as Housing Minister Megan Woods revealed the criteria for an infrastructure acceleration fund, with an invitation for expressions of interest going out at the end of this month.
Woods said the announcement was a crucial milestone in the Government's plan to accelerate the delivery of build-ready land, "assisting in overcoming a key barrier to building – access to basic infrastructure".
Councils, iwi and developers would be apply to apply for funding, with preference given to projects that could deliver multiple, affordable new homes quickly in urban centres as well as the regions.
Eligible projects included new or upgraded infrastructure for drinking water, waste water, sewage, roading, and flood management, which wholly or primarily enable the building of new and additional homes, and the funding could cover early stage feasibility studies, design, consenting and, in some cases, land costs.
In major (or Tier 1) urban areas like as Auckland, Tauranga, Wellington and Christchurch, projects would be expected to deliver at least 200 additional homes, while in Tier 2 urban centres like Rotorua, Palmerston North and Nelson, that figure would be at least 100 extra homes. In other areas of the country, projects should result in at least 30 new homes.
