The Government has established a $52.2 million capital contingency fund in Budget 2015 to facilitate housing development on Crown-owned land in Auckland, Building and Housing Minister Dr Nick Smith says.

“The Government has had its foot on the accelerator to address the housing supply and affordability challenge, and has achieved strong growth in residential construction in each of the past three years.  We recognise the importance of maintaining this momentum to help more New Zealand families into home ownership,” he says.

“It is estimated that the Crown, through various agencies, owns approximately 500 hectares of land in Auckland with the potential for residential development.

“This latest initiative will enable the Government to select vacant parcels of land from the relevant agency and make it available for development by a private sector partner through a competitive process.

“We have demonstrated the success of this approach already in Christchurch with the developments that are currently under way at Awatea, and Welles and Colombo Streets. Fletcher Residential, the Government’s partner on these developments, put forward a proposal to deliver more than 400 homes, with a proportion priced at an affordable range.

“We would be looking to achieve a similar result in any development agreement that is reached with this new fund. We are boosting not just supply, but the supply of affordable homes.

“The further added benefit of the approach promoted by this fund is that we will enable development on land that has already been zoned as residential, but with no existing buildings or tenants to manage – meaning houses will be able to be brought to market faster.

“The next step will be to identify the specific parcels of land for possible purchase. Our aim is to have a signed development agreement for the first land parcel within six months.”

The contingency fund announced today is the latest initiative in the suite of measures the Government already has in place to improve housing supply and affordability in Auckland and across New Zealand. 

“We have signed Housing Accords with six local councils, including Auckland, which have seen more collaboration between central and local government.

“We are freeing up more land faster for residential development through our Special Housing Areas, increasing skills and productivity in the construction sector, reducing tariffs on building materials, and constraining development charges under the Local Government Act.

“Our KiwiSaver HomeStart scheme, which came into effect on 1 April 2015, provides financial assistance to 90,000 first-home buyers.

“The next key measure is our planned second phase of the Resource Management Act reforms to tackle the long-term issues affecting housing affordability and supply,” Dr Smith says.