$24m housing loan

SHARE

A $24 million interest-free loan for infrastructure enabling new housing at Ladies Mile will make a “significant difference” to Queenstown’s housing shortage, Mayor Jim Boult says.

Mr Boult said yesterday’s announcement by Housing Minister Phil Twyford was “another excellent move by the Government”.

The minister was listening to the council and had “enthusiasm” for looking at ways to help.

The loan facility is from the $1billion Housing Infrastructure Fund set up by the previous government. The council, Otago Regional Council and NZ Transport Agency can draw on it to build infrastructure, including wastewater mains, a pump station and water supply reservoir.

It will also be used to build a new roundabout on the Frankton-Ladies Mile highway, a pedestrian and cycle underpass and bus stops.

Mr Twyford said the loan should accelerate the building of 1100 houses on the land by up to six years, and the first houses could be built by 2020.

Councillor John MacDonald, who chairs the housing task force set up by Mr Boult last year, said the council had prepared a strong business case for the loan.

Combined with the Ladies Mile master plan, it had convinced the Government the district had a compelling case for the funding and a clear plan for how to use it.

However, it would not come into play until developers and landowners came up with specific housing proposals.

“It’s not money in the bank yet.”

Queenstown Lakes District Council chief executive Mike Theelen said it was expecting a special housing area application to be lodged by two Ladies Mile landowners by the end of the year.

If approved, it would be the “catalyst” for the council to begin detailed design and consenting work on the infrastructure.

Mr Twyford said the loan was “well justified” for a town with a median weekly rent of more than $600 and house values rising 7% during the past 12 months.

“Councils in high-growth areas like Queenstown are keen to progress housing developments, particularly for affordable housing, and funding towards infrastructure to support those developments will go a long way to ease pressures on councils.”

The $24million announced yesterday adds to $52million announced last month for loans to build infrastructure enabling 900 new homes on a greenfields site at Quail Rise South, near Frankton, and 950 homes in Kingston.

The $76million total is a large increase on the $46.5million for 3200 homes promised by the previous government 12 months ago.

Mr Twyford also announced HomeStart and Welcome Home Loan house price caps for the district would increase by $100,000 to $600,000 for existing homes and by the same amount to $650,000 for new builds.

The previous caps had made it “virtually impossible” for first-home buyers to access the grants, because only 7% of house sales in the district were below $550,000 in the year to March.

The changes were the result of a letter he received from Clutha-Southland MP Hamish Walker highlighting the discrepancy between Auckland and Queenstown HomeStart price caps.

Mr Walker said since the HomeStart programme started in 2015, median house prices in Queenstown had overtaken those of Auckland and were now significantly higher, yet the cap in Auckland was $100,000 more.

The changes come into effect on September 17.

Details

$24m in loans for infrastructure in Frankton-Ladies Mile area.

From Government’s Housing Infrastructure Fund.

10-year, interest-free loans repaid through developer contributions.

Adds to $52m in loans for infrastructure in Kingston and Quail Rise South.

HomeStart and Welcome Home Loan price caps to rise by $100,000 in the Queenstown Lakes district.