KiwiBuild struggling to deliver on housing crisis

KiwiBuild is one of Labour’s most important initiatives. It is supposed to address the ‘housing crisis’, to boost the number of houses needed around the country to accommodate a growing population. And it was initially presented as a way of portraying the Labour-led government as progressive and as compassionate as Michael Joseph Savage’s Labour that kicked off state housing  in the 1930s.

But KiwiBuild has proven to be a problem for Labour.  It is struggling to deliver on Labour’s promises, and the resignation of it’s first head – Head of KiwiBuild wasn’t working, now resigns – won’t help house building progress nor credibility.

The promise (Labour housing policy):

Build 100,000 affordable homes across the country

Labour’s KiwiBuild programme will build 100,000 high quality, affordable homes over 10 years, with 50% of them in Auckland. Standalone houses in Auckland will cost $500,000 to $600,000, with apartments and townhouses under $500,000. Outside Auckland, houses will range from $300,000 to $500,000.

It was always going to crank up the building programme.

The plan (Labour FAQ: KiwiBuild):

KiwiBuild is aiming to build:

  • 1,000 homes in the year to June 2019,
  • 5,000 the year after, 10,000 in the year to June 2020,
  • 12,000 every year after that.

The execution to date – Stuff’s Kiwibuild Tracker:

  • Homes built 33
  • Homes under construction 77

There is a lot required in the next five months to make the June target.

Gareth Kiernan (chief forecaster at economic consultancy Infometrics) at Stuff: Resignation another step to KiwiBuild failure:

Stephen Barclay’s departure as head of the KiwiBuild unit makes it even less likely that the scheme will be able to progress at the rate hoped for by the government.

Even allowing for a slow start, things are falling woefully behind.

Bearing these KiwiBuild targets in mind, having dynamic leadership for the programme seems imperative. Yet the KiwiBuild unit has effectively been without a leader of any sort since early November.

​KiwiBuild is an ill-conceived policy mess that doesn’t understand what is making housing unaffordable, why that unaffordability is a problem and needs government intervention, or even exactly who the policy is trying to assist.

We’re left with small $650,000 houses in Auckland’s outlying suburbs being offered to graduate doctors, or building homes in New Plymouth and Wānaka that are still too expensive to provide a realistic alternative for people wanting to get into the housing market.

Attempting to provide affordable housing while failing to address high land costs and ignoring critical capacity constraints in the construction industry is a recipe for failure.

So will Phil Twyford keep trying to do more of the same? Will Jacinda Ardern stick with Twyford as Minister of Housing? Probably, demoting Twyford would be seen as an open admission of failure, and more importantly, there is hardly a wealth of talent waiting to step up to one of the toughest jobs in Labour’s Cabinet.

KiwiBuild has to find a new head, and Twyford is going to have to show abilities not yet apparent, as well as finding new ways to accelerate the rate of house building.

Whether housing overall is a large problem or a crisis is just political semantics.

Whether KiwiBuild under performance is a large problem or a looming crisis looks like reality.

 

 

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51 Comments

  1. Griff.

     /  20th January 2019

    They have it wrong
    Building large houses at high cost
    Trailer homes/ cabins whatever you want to call small transportable houses are better than nothing.
    You simply dont need a large house to live in or a large section.
    For a couple 30 sq m is sufficient add 10sqm for each child . You can buy ready made fully fitted out cabins for @ 2500 a sq m that are made by commercial operations now. They could be placed on 200sq m sections already provided with sewer water and power for a fraction of the cost of a 600 sq m stand alone house section.
    Kiwi build should be about basic accommodation as a stepping stone towards aspirational standalone houses of 140sqm plus on full sections.

    Reply
    • Pink David

       /  20th January 2019

      Do you live in a 30 sqm home?

      Reply
      • Griff.

         /  20th January 2019

        I lived on a boat for six years.
        Before I moved the houses on a 10sqm cabin for about a year here.
        At the beach before we built we had two cabins at 48sq meters total for five years.
        Funken luxury.
        Full size kitchen/dinning and small lounge in one. Double bedroom with walk in wardrobe and decent sized bathroom/ laundry in the other.
        Kiwi build was about a “housing crisis” poor living in garages and ten to a flat not building homes for middle NZ.

        Reply
        • Pink David

           /  20th January 2019

          So, no you don’t.. When you did spend time in a smaller dwelling, it was your choice and with a longer term goal. That is a huge difference to what you are proposing, which is basically a trailer park. If you had not noticed, we have done this before, large chunks of South Auckland are an upmarket version of what you are proposing. That didn’t solve the problem, what makes you think giving them even smaller homes works better?

          “Kiwi build was about a “housing crisis” poor living in garages and ten to a flat not building homes for middle NZ.”

          It was never about that. As I’ve said repeatedly, ‘affordable’ housing is about nice, executive houses in nice areas for middle NZ subsidized by others.

          The problems with ‘poor’ people living in overcrowded conditions are far more than just a housing issue, and no one, esp Labour really wants to solve it.

          Reply
          • Griff.

             /  20th January 2019

            If you had not noticed, we have done this before, large chunks of South Auckland are an upmarket version of what you are proposing. That didn’t solve the problem

            You talk unmitigated rubbish almost all the fuckin time.
            The building effort they repent housed a large proportion of kiwis and still do.
            I spent my childhood living in one across the road from the Douglas family. You might even know of one of the boys.. Named Roger…..
            John Key was another who spent his childhood in a state house.

            Reply
            • Pink David

               /  20th January 2019

              When I grew up there, people were living in garages. I lived in a small, old caravan out the back of the house. A friend of mine started a business renting them, and he had a lot of business.

              The same problem existed then and it still exists now.

    • Conspiratoor

       /  20th January 2019

      Marketing 101. Understand the market and whats driving the demand. Build em at the right price, and the aspiring homeowner will materialise as if by magic and gobble em up.

      This is all good shit Griff …except kiwibuild isn’t pitched at low incomes…

      “To qualify for a KiwiBuild house, buyers must have joint income up to $180,000 as a couple, or $120,000 as a single person. Buyers must be first-time purchasers or in the same financial situation as first-home buyers”

      You might get a japanese migrant or an indian on the bones of his arse whos just taken up a career at harvey norman, to jump at the offer of a shoebox. But he’s more likely to bunk with the relations or rent a corner in a three beddie with 30 of his mates

      Reply
      • Blazer

         /  20th January 2019

        pretty easy to ‘understand’ the ‘market’….’gimme shelter’!

        Reply
    • Duker

       /  20th January 2019

      The fixed costs for housing dont change much from a 2 bed house at 80m2 to 140m2

      The small places you refer to are being built – they are called apartments .
      Is the minimum for a ‘studio’ 30m2

      Reply
      • Pink David

         /  20th January 2019

        “The fixed costs for housing dont change much from a 2 bed house at 80m2 to 140m2″

        Correct. The additional size just comes at the cost of walls, roofing and air.

        ‘The small places you refer to are being built – they are called apartments .
        Is the minimum for a ‘studio’ 30m2”

        Yeap, and apartments are an expensive way to provide housing. A 30m2 studio for a couple is kind of shitty. There just isn’t any space apart.

        Reply
        • Duker

           /  20th January 2019

          ” A 30m2 studio for a couple is kind of shitty”

          Which contradicts what you said earlier that 30m2 is enough for a ‘couple’
          Which measurement system have you changed to make 30m2 any different in floor size.
          maybe its this years version of the hula hoop – the tiny house.
          They looked into people who lived in these , the ‘couples’ all said they had no intention of staying.
          maybe cat loving spinsters will see them as a ‘final home’
          In Russia , dont whole families live in a single room, with shared facilities, and thats shitty too.

          Reply
          • Pink David

             /  20th January 2019

            “Which contradicts what you said earlier that 30m2 is enough for a ‘couple’”

            errr…where?

            Reply
    • Pink David

       /  20th January 2019

      “For a couple 30 sq m is sufficient add 10sqm for each child . You can buy ready made fully fitted out cabins for @ 2500 a sq m that are made by commercial operations now. They could be placed on 200sq m sections already provided with sewer water and power for a fraction of the cost of a 600 sq m stand alone house section.”

      Fun with numbers;

      Auckland 200 sqm section; $400,000
      Ground works & services; $75,000
      Council costs/consents etc. $100,000. The last small housing development I was involved in had over a million in court costs just to get resource consent, that added $30,000 per house.
      30 sqm dwelling to high-ish standard $75,000

      Total cost:$650.000.

      You are right that it is a fraction, but it is a very large fraction. It’s is insane to put such a building onto such expensive land. The cost difference between your 30sqm house and a 180sqm one is peanuts in the context of the long term value and resale.

      Reply
      • Griff.

         /  20th January 2019

        [Deleted]

        Reply
        • Pink David

           /  20th January 2019

          Reality hurts huh.

          Reply
          • Griff.

             /  20th January 2019

            ROFL
            you are a fantasist my poor little friend .
            Serviced section new development Auckland district
            https://www.trademe.co.nz/property/residential/sections-for-sale/auction-1783112701.htm?rsqid=ceed4d61cf814918827435f1a160d123
            599m2
            Price: Asking price $238,000

            BRAND NEW TINY HOME – fully self contained
            his tiny home is fully complete, self contained and ready to be placed on your site. Built locally to NZ standards, this tiny home has a seperate bedroom, separate bathroom with full sized shower, a vanity, WC, and kitchen including gas hob.
            Quality carpet and underlay, vinyl to wet areas, new double glazed stackers and fully insulated to exceed building code.
            Please note this auction is for the top of the range OHAU model, we do sell the base model for only $44,995.
            https://www.trademe.co.nz/building-renovation/portable-cabins/listing-1910545732.htm?rsqid=448cd3945280471db766e5fb2a5d8f59

            Well under half your dribble on a full section you could place 3 on.

            As too 75,000 to hook up services .
            ROFL 5 grand tops

            Reply
            • Pink David

               /  20th January 2019

              “Serviced section new development Auckland district”

              $400,000 is for a 200sqm section in Auckland City. Glenbrook is 60km from downtown Auckland. Now I chose that as the extreme case of course, but that is where the problem is.

              “As too 75,000 to hook up services .
              ROFL 5 grand tops”

              If that is a tendered, fixed price, I’ll happily accept it. Can you be onsite tomorrow? Please ensure you do all the ground works and landscaping, and pay all the contributions, and adhere to all the consent conditions. You do know what they are don’t you? I was specific about the scope, it’s far more than just digging the trench and laying a few pipes. Just to warn you, it’s not a flat site, and central Auckland.

              “BRAND NEW TINY HOME ”

              Awesome. Looks nice, I’m sure you will be very happy with it. As I have said before, houses are cheap. That simply isn’t the problem.

              Once you have three of them on your section at Glenbrook, please get back to me on how it all worked out.

              I do, to a large degree, agree that the cost of proving lower cost housing isn’t as high as it is being made. Building a large, greenfield, low cost suburb would cost far less than current prices, however, that is prevented by law.

    • PartisanZ

       /  20th January 2019

      If they’ve got it wrong, all of New Zealand has got it wrong … and had it wrong all along …

      So … let’s start dividing up existing houses into 4 – 6 ‘little house’ apartments. NZ’s housing stock could be four times what it is now …

      All we need is ………. ‘socialism’ ……….

      Reply
  2. Alan Wilkinson

     /  20th January 2019

    Labour exists to promote the fatuous lie that Government can do anything better than private enterprise. Which is exactly what Kiwibuild is.

    Reply
    • Alan Wilkinson

       /  20th January 2019

      Just to state the blindingly obvious, if you want to fix the housing cost and shortage you have to fix the reasons the private sector can’t deliver and they are all bureaucratic.

      Reply
      • Blazer

         /  20th January 2019

        let me make it simple for you Al.
        If bread is the staple of the Kiwi diet and every loaf is sold to any person that will pay the most for it….there will be a shortage for the hoi polloi….and no…they can’t ..eat cake!
        Comprenez?

        Reply
        • Alan Wilkinson

           /  20th January 2019

          Let me make it simpler for you, B. Capitalism is where bread queues for you and socialism is where you queue for bread.

          Reply
          • Blazer

             /  20th January 2019

            let me expand on that…bread is basically …’dough’and if you don’t have the dough…you don’t have the…bread.

            Reply
            • Alan Wilkinson

               /  20th January 2019

              Then get off your arse and earn some dough.

            • Blazer

               /  20th January 2019

              very good Al…every one who needs a roof over their head in Aucks, just needs to earn some ‘dough’ to pay off a million dollar hacienda…that should..work!

            • Alan Wilkinson

               /  20th January 2019

              No, they need to give property rights back to property owners and stop bureaucrats saying no, wait, maybe, that’ll cost you $30k.

              Just talked to a builder who lost a big job when the owners got fed up after waiting six months for a consent and walked away from it. Bureaucratic pricks with power need to have it amputated at the trunk.

            • Blazer

               /  20th January 2019

              is the builder ..short of work?

            • Alan Wilkinson

               /  20th January 2019

              Probably temporarily as he was also waiting for approval so he could start. Bureaucrats stuff everyone up and don’t give a stuff because they don’t have to. Rather like you.

            • Blazer

               /  20th January 2019

              you call me a bureaucrat!Sacre bleu…get..STUFFED.

            • Conspiratoor

               /  20th January 2019

              Stuff headline…

              “Growing shortage of bureaucrats as a large number have been found hanging from fences in the Russell area. Local glampiere suspected”

            • Alan Wilkinson

               /  20th January 2019

              I like the way they twitch when I electrify it.

            • Duker

               /  20th January 2019

              “Just talked to a builder who lost a big job when the owners got fed up after waiting six months for a consent and walked away from it.”

              Ah yes. The single build premium home on a difficult site.
              That has no connection to the group builders who have a range of standardised homes on new subdivisions where the RMA has been satisfied and onlyconstruction consent is required.
              Only 5% of the current build is at the low end of costs ( hugely inflated after nationals 9 years), which is where kiwibuild is working.

      • Duker

         /  20th January 2019

        It isnt bureaucratic failure.

        Kiwibuild is using private contractors who design and build.

        You have heard about takanini and Hobsonville developments ?

        The land developer was Housing NZ ( bureaucratic) who did the roads and services for the builders to buy land and construct the houses and the failed previous government model.
        The end end result was only 5% of new housing was at the low end of the market, Plus not enough houses overall that were being built in the mid 2000s or even before the 90s.

        Using the state for housing development was good when national did it , but bad when labour does it.

        Reply
        • Alan Wilkinson

           /  20th January 2019

          Why do people with no clue think they have opinions that matter? Oh, that’s right, because they elect politicians with the same degree of ignorance.

          Reply
          • Blazer

             /  20th January 2019

            you may well ask…yourself!

            Reply
            • Alan Wilkinson

               /  20th January 2019

              I did, and answered above.

            • Blazer

               /  20th January 2019

              of course…not only do you pose the questions,you provide the answers…and mark up a perfect…score.

          • Duker

             /  20th January 2019

            Unlike you I have a background in engineering, house building and land development.

            Reply
            • Alan Wilkinson

               /  20th January 2019

              Doesn’t show. Give us some history.

            • Alan Wilkinson

               /  21st January 2019

              So no history and I call bs on your claim. From your comments if you have a history it is in the paper-pushing industry that is the sole beneficiary of our bureaucratic stagnation.

  3. Blazer

     /  20th January 2019

    so the rush to judgement in 5 minutes.
    This is a herculean task,a crisis not only ignored but exacerbated by 9 years of neglect.

    Reply
  4. George

     /  20th January 2019

    [Use proper party names please] deserve all the adverse publicity they get.
    This was supposed to be the answer to homelessness and families living in their cars.
    Strangely all fake news stopped reporting such horrendous articles when the government changed

    Reply
    • Blazer

       /  20th January 2019

      strangely..when the Govt changed Mr Bridges started using a word banned by National…crisis!

      Reply
  5. Zedd

     /  20th January 2019

    Natl did nothing in the ‘affordable housing’ market for 9 loooong years. In fact by ‘leaving it to the open market’ they drove prices up & up & UP !
    During their time; houses in Akld passed $1mil (unaffordable for most, but the rich) price tag… They also sold off many state houses, to the highest bidders (Cronyism)

    Now they attack this Govt. for at least trying to address the issue. ‘You missed dotting a few Is & crossing a T or 2′ so you failed totally’; Narrow-minded B-S
    “Go Figure” ??

    Reply
    • Alan Wilkinson

       /  20th January 2019

      Why don’t you try writing about something you know something about, Z?

      Reply
      • Duker

         /  20th January 2019

        Know something ?
        Coming from you, you use nationals talking points but mostly despise them.
        Cant use ACTS talking points as they totally useless led by NZs certified dickhead politician.

        Reply
        • Alan Wilkinson

           /  20th January 2019

          Did you say anything in that brain fart?

          Reply
          • Kitty Catkin

             /  20th January 2019

            The idea of National selling houses to cronies is too absurd to be taken seriously.

            Most houses in Auckland are still owner-occupied. If people want a start on the property ladder, tell them to buy an apartment.These are very affordable.

            How could National drive prices up ? It would be impossible. John Key said that even if they could, they wouldn’t force them down and make people victims of negative equity when the value of their house plummeted but the mortgage didn’t. What sort of government would make people pay a mortgage that was far higher than the house was worth ?

            Reply
            • Kitty Catkin

               /  20th January 2019

              My brother and his partner were caught in negative equity. They bought when prices were high and when the market slumped, their house (half a terraced house, two-up-two-down) was worth far less than they’d paid for it.

  1. KiwiBuild struggling to deliver on housing crisis — Your NZ – NZ Conservative Coalition

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