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16-10-2008

Govt-owned sections for lower-income earners

NZHERALD

Labour has announced plans to open up areas of public land in pricey areas such as Auckland so modest income earners can build their own homes.

Prime Minister Helen Clark announced the scheme yesterday as a further prong of Labour's attempts to provide affordable housing in the wake of steep increases in property prices. Aimed at those earning between $44,000 and $55,000, about 1500 sites of public land would be made available over the next four years, mostly in Auckland.

Under the scheme, those who qualified would pay for and own the house they built, but the state would retain the land and allow its use for no charge. Similar measures were likely in Wellington, Christchurch, Queenstown and Nelson.

It is similar to the National Party's recently released "Gateway" policy to use public land for cheaper housing. However, National would allow free use of the land for up to 10 years after which the homeowner would have first right to buy it. Under Labour, the land was likely to remain in state ownership to insure the home remained affordable if it was onsold.

Helen Clark said Labour had worked on the scheme for some time to find a solution for lower income workers in areas where property prices were high.

Although housing prices had come off their peak, she said homes were still they're not as affordable as they were in 2002.

She said a simple starter home could be built for about $165,000 - and without the cost of the land this was affordable for those on incomes of about $44,000.

Helen Clark said although shared equity allowed middle income couples to buy in areas where property was expensive, it was not a solution for those on lower incomes.

"We are still looking at what more needs to be done to support the family which is at the lower end of the shared equity bracket, which is $55,000 to $85,000 total annual income and particularly a family on the average wage earning $45,000 or so."

The policy follows a stocktake of all public owned land in Auckland, which she said found a significant number of plots of land suitable for housing.

Helen Clark said there was considerable potential across Auckland. Land Information New Zealand had about 280 parcels of land which could be used and Housing NZ in Otara and Mt Roskill had found about 4000 possibilities for homes.

She said it was likely land would be allocated by ballot, rather than a first-in first served land rush.

She said the cost to the Crown was "negligible" because it would not be involved in building or developing the land.

 

 

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