State house sales move closer

Planned sales of state houses in Tauranga and Invercargill will go ahead but the Government wants the Tauranga properties to go to a single buyer or consortium, according to newly-released papers.

Wednesday, September 2nd 2015, 8:14PM

by Miriam Bell

The two Information Memorandums relate to the impending sale of around 1140 Tauranga and 370 Invercargill state houses to registered Community Housing Providers (CHPs).

They are intended to sound out the market on key aspects of the proposed sales before the formal process begins.

According to the Tauranga memorandum, the Government wants one buyer for all the Tauranga properties - apart from 115 properties which local iwi Ngāti Ranginui has right of first refusal on.

However, Tauranga Moana-Te Puke Housing Consortium spokesperson Victoria Kingi told media her group was interested in buying all the houses in Tauranga and Te Puke for joint ownership by the three local iwi.

Accessible Properties, which is a nationwide provider of accommodation for disabled people, is also thought to be interested in buying the Tauranga properties.

When it comes to Invercargill, the relevant memorandum states the Government plans to sell the properties as one to three packages.

Ngāi Tahu has right of first refusal on three of these properties.

The properties which the two iwi have right of first refusal on will be excluded from the commercial sale process.

But the Government is working with Ngāti Ranginui and Ngaī Tahu on how to retain them as social housing.

The sales will go ahead as part of the Government’s social housing reform programme and, as such, only CHPs will be able to purchase the state houses.

However, there is scope for private investors to get involved in the provision of social housing – either by becoming a registered CHP or by partnering with a registered CHP.

For example, it has been reported that British company Serco is interested in moving into social housing and is exploring the possibility of providing support to registered CHPs.

Several Australian social housing providers have expressed interest in buying the state houses.

In order to do so, they would have to be registered as CHPs.

A number of existing CHPs have indicated they would consider partnering with commercial entities to achieve better social housing results.

Meanwhile, the Social Housing Reform (Transaction Mandate) Bill*, which enables the government to sell Housing New Zealand stock to third party providers, passed its first reading in mid-August.

Social Housing Minister Paula Bennett said the government aims to encourage more diverse and innovative provision of social housing with the transfer of state houses to CHPs.

While the sales look set to proceed, Bennett told the Social Services Select Committee that they aren’t likely to happen this year.

*Submissions on the Bill are due by 1 October 2015.

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