Twyford under pressure on Kiwibuild policy of straw

Labour campaigned on a bold policy to build 100,000 new ‘affordable’ houses in ten years. Phil Twyford was prominent in promoting the policy and slamming the then National led government for it’s poor record on housing.

But Twyford has hit some speed bumps, with chimneys falling off Labour’s grand plans.

Twyford has been found wanting on detail over affordability and pricing of Kiwibuild houses, and it now seems that the Government won’t necessarily build all those houses promised – they will buy from existing housing stock, developments and off plans.  This may allow them to claim numbers, but it will reduce privately built and owned houses.

There has always been questions about how affordable Kiwibuild houses might be. How does half a million dollars for a one bedroom apartment  sound?

NZH: Larger Kiwibuild homes will cost $50k more than promised during election campaign

The Government has hiked the price of larger houses in its flagship building programme by $50,000.

Labour’s election promise to build 100,000 affordable houses in 10 years included prices of between $500,000 and $600,000 for standalone homes and a cap of $500,000 for apartments.

Tender documents sent out to developers on Tuesday show that new homes built under the Kiwibuild programme would now be priced according to how many bedrooms they had.

One-bedroom properties would be sold for $500,000, two-bedroom for $600,000 and three-bedroom for $650,000.

That meant the larger houses were $50,000 more than Labour promised during the election.

A spokeswoman for Twyford said that was because the modelling on the prices had been done two years ago and had now been updated.

Will prices be updates again when the houses are actually built?

Newshub: Housing Minister apologises for ‘confusion’ on price of KiwiBuild homes

Housing Minister Phil Twyford has apologised for a mistake he made about the price of a KiwiBuild home.

On Friday morning on The AM Show, Mr Twyford said the price of a one-bedroom Kiwibuild home would be $550,000.

Mr Twyford now admits he was wrong.

“I misspoke this morning when discussing the KiwiBuild price points. I apologise for any confusion caused,” he said in a statement to Newshub.

“Yeah, it’s gone up slightly. We did the original modelling for those price points two years ago, and under Judith’s [Collins, National housing spokeswoman] Government’s policies, build costs are rampant,” Mr Twyford told The AM Show.

 

And KiwiBuild seems to have also become KiwiBeg and KiwiBuy.

The Government has also been under fire from the Opposition over its plans to buy homes currently under development in order to reach its ambitious KiwiBuild targets. Documentation on the scheme now says it “aims to facilitate the delivery of 100,000 affordable dwellings”, rather than just build.

“By underwriting or buying affordable KiwiBuild homes off the plan, what we do is we de-risk and speed up developments that otherwise might not take place at all.”

It is also likely to take over private developments, simply moving numbers from private to public and not increasing housing stock as much as promised.

Duncan Garner calls it “a total hoax”r: If Twyford can’t Phil us in on KiwiBuy/Build, who can?

Seriously, what has Labour and its MPs been doing these last nine years? Eating their lunch? We’d been led to believe its flagship Kiwibuild idea was this amazing, smart and innovative housing policy. We’d been told it was an answer to the housing crisis for those who couldn’t get into their first home.

And I assumed KiwiBuild meant just that;  as Housing Minister Phil Twyford said, 100,000 homes would be built.

Now we learn, um no, that’s not the case. It’s Kiwibuy, that house, your house, any house will do.

Labour has simply thrown its arms up in the air and put up a classified advertisement the size of a house that calls for all houses to be bought and sold as Kiwibuild dwellings. Labour wants the biggest shortcut to success possible.

It wants to buy current homes under construction or off the plans and call them Kiwibuild’s own. It’s a total hoax.

And what, Labour suddenly wants to partner up with the private sector? How convenient.

What happened to development on a genuine scale and with true Government buying power.

To me, it looks like Labour and Twyford have made this all up on the back of a moving envelope. It is underwhelming nonsense from a party that looks bewildered and blinded by the size of the challenge. It lacks detail.

 

Labour now thinks motels for emergency housing ok

Now they are facing the realities of housing shortages in Government Jacinda Ardern and Phil Twyford have switched to supporting the use of motels for emergency housing.

RNZ: Govt’s use of motels ‘morally irresponsible’ – housing advocate

The government has announced it will spend $100 million to try to tackle homelessness and provide emergency housing.

That is badly needed to try to alleviate a dire housing situation.

Prime Minister Jacinda Ardern said it would be irresponsible to not make use of motels and hotels because there was so much immediate need.

“That remains a very quick option and, in the time we had available, still remains on the table but of course there a number of other options we favour over that,” she said.

Housing Minister Phil Twyford said of the 1500 extra housing places the government was delivering, 115 were long term motel stays.

They allowed for flexibilty if there was a spike in homelessness, particularly with winter approaching, he said,

“No one likes the idea of the government spending money to put people up in hotels but if we have to do that in order to ensure people have a roof over their heads we will,” he said.

Sounds fair enough and quite sensible. But it is a change of view since switching from Opposition to Government.

Stuff last October: Emergency motel stays starting to decline, but still cost govt $97k a day

New figures from the Ministry of Social Development show that in the last three months $8.96 million was given out to cover short seven-day motel stays for families or individuals in dire need. The money made up 9159 grants and several families claimed the grant more than once.

This is a drop on the previous three-month period of April-June when a record $12.6m was spent on 11,446 grants.

Outgoing social housing minister Amy Adams said the numbers had peaked mid-year.

“While we’ve spent a lot in the last quarter we’re also seeing that that has peaked now, and there are some really pretty good signs that that is dropping, which is exactly what we expected,” Adams said in July.

“This is exactly what we wanted to happen but it takes time to build 1400-odd transitional houses, and the motel grants have been a way for us to bridge that.”

House building does take time, especially the finding of suitable land and getting consents, and also given the dire shortage of housing in Auckland in particular and the shortage of builders and tradespeople.

Labour’s Phil Twyford, likely to be Housing Minister by the end of the week, could not be reached for comment.

 

Further back, a statement from Twyford in July: English out of touch on homelessness

Bill English’s comments that he doesn’t know why people are complaining about the blowout in the number of homeless families the government is putting up in motels just shows how tired and out of touch National is after nine years, says Labour’s Housing spokesperson Phil Twyford.

“New Zealanders are rightly outraged that National is selling off state houses while spending $50m a year dumping families in need in motels. They’re stunned that National is so out of touch they thought they would be spending just $2m a year on motel rooms, when the problem is 25 times that size.

“New Zealanders know that every family needs a home, a permanent roof over their heads. Shunting kids from motel to motel, week to week, is no solution.

“Labour will stop National’s state house sell-off and stop sucking profits out of Housing New Zealand. We’ll build thousands of state houses for families in need, alongside our KiwiBuild programme to build good starter homes for first home buyers.

“Last week, we learned that New Zealand has the worst homeless rate in the developed world, and National’s response was to quibble about definitions. They have no ideas, no solutions, just excuses.

“National’s legacy is the worst housing crisis in the world. It’s time for Labour’s fresh approach to make sure that every Kiwi has a decent place to live,” says Phil Twyford.

The ‘fresh approach’ looks like more of the same.

Ardern in April last year: Motel buy-up bad policy

Labour leader Jacinda Ardern says National continues to underestimate the size of the housing crisis.

“After particularly the likes of Te Puea Marae and the amazing work they did last winter, we thought the government would be more prepared, unfortunately they haven’t been and now we’re in a situation of buying hotels. I accept that we want to do everything we can to house people, make sure they’re warm, dry have a roof over their head but it makes much more sense for us to have permanent state housing and social housing rather than paying private moteliers a lot of money,” she says.

Now winter is looming and there still aren’t enough houses Twyford and Ardern are biting the motel bullet.

And now, as well as conceding that motels are necessary to fill housing gaps, a novel approach – Govt appeals to public to identify rentals, marae and land which can be used for homeless

The Government is appealing to the public to provide houses and land to help solve New Zealand’s homeless problem.

It promised today to invest $100m into tackling homelessness, by increasing short-term and long-term housing options and increasing funding for social services.

Rehousing people from the street or temporary housing has been complicated by the lack of available or affordable housing, especially in Auckland.

That led the previous Government to start renting motels to house the homeless. Labour criticised this at the time but admitted today that it needed motels until more homes were available, and has put aside $8m for this purpose.

After announcing the funding today, Housing Minister Phil Twyford pleaded with the public to identify properties that could be used for emergency shelters or pop-up homes.

“We can’t do this alone,” Twyford said. “If you know of properties that might be available over winter, such as seasonal worker accommodation or private rental homes, we’d like to hear about those.

“We’d also like to identify small land options suitable for temporary housing with power and water connections ready to go, such as marae and private land.”

Property owners would be paid market rents, he said; they were not expected to simply donate properties.

“If there’s a massive surge over winter, we need to have those other options in our back pocket.

There was never going to be a quick fix to the housing shortages.

Auckland transport plan announced

Labour Minister Phil Twyford and mayor Phil Goff have announced a ten year transport plan for Auckland.

While it will bolster rail, cycleways and walkways, it includes major spending on new roads and motorway improvements links, and will rely in part on Public Partnerships and toll roads as well as a regional fuel tax.

RNZ: New $30b plan to tackle Auckland transport woes unveiled

The government and Auckland Council have announced the new Auckland Transport Alignment Project (ATAP) at Newmarket train station today.

Billed as New Zealand’s largest ever civil construction programme, $28 billion will be poured into light rail and roading projects at Penlink and Mill Rd.

Heavy rail and bus upgrades, safety improvements and more dedicated cycle lanes are also part of the plan.

The projects will be funded by $4.4 billion raised from the new Auckland fuel tax, increased revenue the National Land Transport Fund and Crown Infrastructure Partners contributions.

ATAP major investments include:

  • Committed projects like the City Rail Link and northern motorway improvements.
  • Light rail
  • Eastern busway (Panmure-Botany)
  • Airport-Puhinui State highway upgrade, including a high quality public transport link to an upgraded Puhinui rail station
  • Bus priority programme, to more rapidly grow Auckland’s bus lane network and support faster, more reliable and more efficient bus services
  • Albany-Silverdale bus improvements
  • Lower cost East West Link to address key freight issues in the area
  • Papakura-Drury motorway widening
  • First phase of the Mill Road corridor
  • Penlink (tolled)
  • Walking and cycling programme to expand the network and complete key connections (e.g. SkyPath)
  • Significant programme of safety improvements
  • New transport infrastructure to enable greenfield growth
  • Network optimisation and technology programme to make the best use of our existing network
  • Rail network improvements including electrification to Pukekohe, additional trains and other track upgrades

Read the full plan here

And of course there are critics (apart from National). RNZ: Transport plan ‘too little, too late’ for south Auckland

It’s been billed as New Zealand’s largest ever civil construction project – but South Aucklanders say a government transport plan doesn’t go far enough.

But Jatin Khurana, who travels from Papakura to Ellerslie every day for work, said waiting 10 years for just the first section to be upgraded wasn’t going to make much of an impact.

“The first phase – those few kilometres – that’s going to have a bottleneck effect so it will not really improve the situation,” he said.

“I think it’s too little, too late.”

Mr Khurana said the heavy congestion on the Southern Motorway and the increasing traffic on Mill Road had driven him to take the train.

Stuff: Auckland transport fix: Key facts

Memo to Phil Twyford – you don’t speak on behalf of ‘New Zealanders’

Ex National MP Wayne Mapp via Twitter: Ardern and Twyford are betting their futures on voters backing their zealotry

In reality the government has largely continued the broad economic settings of the Key/English government. The CPTPP was signed, and in a pretty much unchanged form to the TPP. Basic tax rates are unchanged, and as a consequence so is the overall level of government.

But the government is Labour led, and the prime minister is youth adjacent. She is closely identified with younger urban professionals living in inner city suburbs. For her, climate change is her generation’s anti-nuclear moment. This must signify some sort of fundamental change, not just in the language of virtue signaling that is so familiar to the left, but also in actual policy.

The first real indications of these changes have been in the recently announced transport policy and in the Kiwibuild project on the 29 hectares of land where 4,000 dwellings are proposed, presumably mostly apartments. In these announcements the government, particularly Phil Twyford who is the key minister for both, has spent a great deal of political capital in telling New Zealanders what is good for them. In both cases the prime minister led the announcements, so these are things dear to her heart. She intends that her government will be identified by them, and that it is a government with very different priorities to National.

The Spinoff has had articles praising both, by Matt Lowrie of Greater Auckland on the transport plan, and urban designer Matthew Prasad, one of the advisers to Unitec to transfer its land for intensive development. Both of them are within the core cohort of Ardern’s support base. Naturally they like what they see. In fact they have each had a hand in the basic philosophy of the proposals. Both initiatives represent their vision of what New Zealand should be like, rather than what it is.

But neither of the proposals have much appeal to typical National party supporters, who, after all, are nearly half of the population.

Phil Twyford has responded (via The Spinoff): Memo to Wayne Mapp: New Zealanders want more rapid transit, fewer new roads

In one of the more baffling attacks on KiwiBuild, former National MP Wayne Mapp this week claimed the government is “telling people how they should live” by building affordable houses and bringing our transport system into the 21st Century.

In his column for The Spinoff, he also attacked the Labour-led government for being part of a new “internationalist urban elite”.

These criticisms say more about Dr Mapp’s antiquated thinking than they do about the government’s plans.

I’m not sure how building affordable homes in Mt Albert for desperate first homebuyers is telling people how they should live.

I’m also not sure how wanting to ease Auckland’s congestion makes the government part of an internationalist urban elite.

We’ve listened to Auckland, Wellington and Christchurch who have all asked us to support rapid transit (rail, light rail and busways) in our cities, rather than building more, or wider, motorways. It is part of our commitment to build liveable cities.

Of course people in Auckland, Wellington and Christchurch would like better public transport options via rail or bus. And better cycling and walking options.

But I’m fairly sure quite a few of them don’t want that at the expense of motorways and roads.

Same for many people who don’t live in or near one of the three main cities – over half of New Zealanders would no doubt like better public transport, but won’t get it, so will still quite like to be catered for be new roads.

Young people today no longer believe they have to own a car.

Another sweeping unsubstantiated statement. I’m fairly sure some young people want to own cars, I see young people driving cars all the time.

Twyford would argue his transport policy case better if he didn’t resort to claims that are obviously inaccurate.

Regional fuel tax beyond Auckland?

The legislation enabling a fuel tax in Auckland to help finance transport infrastructure improvements may go further – as far as right around the country. But Transport Minister Phil Twyford says that that can’t happen during the current term of government.

RNZ: Fuel tax possible around the country – National Party

Legislation introduced this week would allow a tax to be imposed anywhere in the country if a regional council makes the case.

National’s transport spokesperson Jami-Lee Ross said Labour campaigned on a fuel tax for Auckland – nowhere else.

The “big surprise”, he said, was that a regional fuel tax would be possible around the country.

“The government needs to be upfront with the rest of New Zealand and tell them that in just a few short years they’re going to be seeing fuel tax in their regions as well.

“It’s another opportunity for the Labour government to tax motorists more.”

But the Transport Minister is assuring motorists no-one outside of Auckland will be hit with a regional fuel tax this term of government.

The legislation prevented regional councils outside of Auckland from seeking a fuel tax until 2021, Phil Twyford said.

“In the future councils may want to take part of it but we’ve been clear publicly and directly to councils that this government will not be considering any other proposals for fuel taxes, other than Auckland’s, in our first term of government.”

Mr Twyford said he had already personally given that message to the mayors of Christchurch and Hamilton.

In its election tax policy Labour specifically talks about a tax only for Auckland, and said Labour had “no plans for any other regional fuel taxes”.

It seems that Labour does have plans for allowing higher fuel tax in other regions, eventually.

Labour have also said they won’t introduce any taxes recommend by the Tax Working Group this term, but they would campaign on what they wanted for the 2020 election. It is possible they will introduce new tax legislation ready to be implement next term – like the regional fuel tax legislation.

Tax could be a big issue in the next election.

I’m sure someone will keep track of all the tax guns loaded, ready to fire should Labour win a second term.

Have your say on the Land Transport Management (Regional Fuel Tax) Amendment Bill

Q&A: Twyford and housing

Labour campaigned strongly agaisnt the national government over it’s poor handling of growing housing problems. They have promised big (100,00o new houses in 10 years), but are yet to look like delivering.

Today on Q&A: Can Labour fix our housing problems?

Housing and Urban Development Minister Phil Twyford is Corin’s lead interview. He has ambitious plans to make housing affordable again – can he deliver?

Twyford was mostly vague about progress, saying the government is working on things and yet to decide on many aspects of the house building project.

He couldn’t give specifics on how windfall profits of those who draw new houses from the ballot will be treated – potentially those who win the housing lottery could gain hundreds of thousands of equity. Twyford said that eventually the increased housing supply would rectify it. There is no guarantee of that, far from it.

Twyford said there will be no means testing – I think that referred to people who are well off (high earners or with family financial support) will not be excluded from entering the ballots.

They must means test any house purchaser in respect of being able to afford to service their mortgage.

It will take a year or two to see whether sufficient progress is being made.

Banning letting fees

Generally I would expect that costs will be recovered one way or another, but it depends on the market situation.

@EricCrampton:

A tax incidence primer. Twyford is right that changes in letting fees will be eaten by landlords (at least in places where supply is constrained.) General principle: the inelastic side of the market bears the burden of a tax.

But for that same reason he is wrong about the extra money for students. Market is tight in Wellington and not Christchurch so we expect the benefit of the subsidy to go primarily to landlords in the tight markets.

It is hard to argue simultaneously that the change in letting fees will be eaten by landlords and that the benefits of the student subsidy did not go to landlords.

Banning letting fees seems to be fiddling at the edges of the housing situation.

‘Having a conversation’ on Air NZ and the regions

Phil Twyford has just appeared on his weekly Newshub morning spot alongside Judith Collins. He is Minister of Transport. Duncan Garner asked him about the Shane Jones attacks on Air NZ.

Twyford effectively backed Jones’ stance on pushing for air services for regions.

He said that as a Minister he would have a conversation with the head of Air NZ over better services for regions.

He was asked if he supported using some of the $200 million annual profit from Air NZ being used to provide regional services, he avoided answering that.

Garner pushed him on what he wanted Air NZ to do, and he copped out with the standard Labour fob  off ‘ they will have ‘an ongoing conversation’.

So without being up front Twyford has effectively backed Jones’ attention seeking stance, which is contrary to what the Minister responsible for state owned companies Grant Robertson has said, and contrary to the sort of reprimand Jacinda Ardern directed at Jones.

I’d expect Newshub to do a news item on this.

 

Homelessness “is much worse than previously thought”

NZH seems to have got a report that is to be released this morning in advance – Homeless crisis: 80% to 90% of homeless people turned away from emergency housing

New Zealand’s homelessness crisis is much worse than previously thought, as a new report identifies a hidden homeless population that is not officially monitored by government agencies.

More than 80 per cent of all homeless people turning up to community emergency housing providers in the last year were turned away because the system is bursting at the seams, according to an independent housing stocktake to be released today.

And the number of recorded homeless people without a safe and secure place to live is expected to rise significantly, as more struggling people are told that help is available and come out of the shadows.

The report, authored by economist Shamubeel Eaqub​, University of Otago Professor of Public Health Philippa Howden-Chapman and the Salvation Army’s Alan Johnson, will be released this morning by Housing Minister Phil Twyford.

The report is understood to bring together figures across a number of areas including homelessness, the rental market, housing affordability – including the rising costs relative to wage increases – and housing supply nationwide, with a specific focus on Auckland.

One of the report’s main focuses will be to highlight a hidden homeless population that is not officially monitored or recorded.

However, community emergency housing providers report they are at full capacity, and their data from last year indicate that for every 10 homeless people that approach them, eight to nine are turned away.​

The report will refer to a burgeoning “floating population” – people without safe and secure housing, including in temporary housing, sharing with another household, or living in uninhabitable places.

The report is understood to say that greater awareness of the issue, along with more information campaigns about where to get help, is expected to lead to reported homelessness getting worse.

The report is intended as analysis of the housing issue, and is not expected to make any recommendations for action.

Odd that the Herald keeps referring to “The report is understood to…” when they obviously either have a copy of the report (have they broken an embargo?) or have been provided with details.

The Government describes it as an independent stocktake of the housing crisis to help focus its work. But National’s housing spokesman Michael Woodhouse has call it a “smoke and mirrors” exercise to find the numbers to fit the Government’s narrative, when the housing market is “flat to falling”.

Politics aside, there is obviously a problem with homelessness and difficulties in finding suitable housing for many people.

Context box: Homelessness crisis

  • 8 to 9 out of every 10 homeless people turned away from emergency housing providers
  • Hidden homeless population with no official monitoring or recording
  • 1 in 100 live in severe housing deprivation in 2013 census, up from 1 in 120 in 2006 and 1 in 130 in 2001
  • Auckland Council says 23,409 in severe housing deprivation last year, up 3000 from the 2013 census
  • 7725 on state house waiting list, up 5 per cent from Sept quarter
  • MBIE figures show a nationwide shortfall of 71,000 houses; 45,000 in Auckland

Regardless of a report trying to detail and quantify the extent of the problems, the key is what the current Government can do to alleviate both homelessness and the wider housing shortage.

Housing Minister Twyford proposes all but rent controls

Housing Minister Phil Twyford thinks that the only way to keep rental rates in check is to significantly increase the supply of housing. That makes sense. But he still intends to introduce rental ‘reforms’ – that is, impose restrictions on rent increases and the costs of letting.

There are already signs that some landlords are quitting the business, or seriously considering it. Putting more pressure on them may make rental supply tighter rather than better.

Stuff: How Phil Twyford plans to address the renting crisis

New Housing Minister Phil Twyford has several plans to make life easier for renters, but has ruled out rent controls.

Instead the new minister is clear that in his view the only way to seriously keep rents in check is to greatly increase supply.

But that doesn’t mean he wants the Government to stay out of the equation: he thinks it has a serious role to play in both increasing supply and softening the rough edges of the private market.

By the end of this year, Twyford wants to introduce legislation to reform the Residential Tenancies Act, our main tenancy law.

The key parts of these proposed reforms will be:

  • an end to letting fees that are charged to tenants,
  • a requirement that rents can be raised only once a year instead of every six months,
  • an end to no-reason terminations,
  • the required inclusion of a formula for how those rent rises will be calculated on every tenancy agreement.

That sounds like coming very close to rent controls.

National’s Housing Spokesman Michael Woodhouse new rules on landlords could easily see them exit the market and reduce the supply just when it is needed most.

“Certainly the best thing not to do is to make it harder for landlords to offer their properties,” Woodhouse said.

“We wouldn’t be following these punitive policies for landlords that they have introduced or said that they would introduce, that are making people like Andrew King from the Property Investors Federation say it’s just getting too hard for the overwhelming majority of landlords who only own one or two properties with things like capital gains tax and ring fencing, or the unknown costs from the Healthy Homes Guarantee bill.

“These are not all sophisticated profit-driven landlords – these are nurses and doctors and teachers.

But Twyford doesn’t believe many landlords will be literally leaving their homes empty, meaning the sum total of housing available shouldn’t significantly change.

The biggest potential problem isn’t landlords leaving their properties empty (they wouldn’t be landlords then, they would be bach or crib owners).

In the short term another Government MP  is also keen to help.

Wellington Central MP Grant Robertson is advising any tenants who believe their rent has risen well above the market rent in their area to consider taking their landlord to the Tenancy Tribunal.

The real risk is precipitating an exodus of landlords from the housing market altogether. In particular, as more baby boomer landlords reach or near retirement they may decide there is something simpler and safer to do with their retirement investments.