Helping locals into their own homes has been less affordable than Queenstown’s affordable housing trust hoped.
Property prices, deposits and the trust’s average equity stake have all panned out higher than planned, says a recent Queenstown Lakes District Council report.
The update is authored by Scott Figenshow, the policy planner who engineered QLDC’s affordable housing initiative.
The quango has so far assisted 28 families into local homes – but at an average of $431,538, the houses have cost eight per cent more than the average $400,000 budgeted.
As a result of the extra $31,000 on the price, and with average annual household incomes $10,000 less than projected, intending homeowners have needed larger deposits – $75,000 average instead of the planned $35,000 – and the council quango has had to hike its share.
At $124,596, the housing trust’s average equity is 25 per cent more than the $100,000 contemplated.
Of 28 households helped, nine are in lower income categories with average incomes down to $41,887, Figenshow says.
Quango planning was also out of kilter in another key factor.
It was assumed 15 ownership deals would be done with households whose finances needed only 20 per cent trust equity – in the event, only eight deals met this low-equity threshold, with more trust money having to go into the other deals done.
Another nine homes are likely to be settled by June 30, Figenshow reports – making 32 deals from 186 applications in the two years of the quango’s existence.
The housing trust began with $4 million of seed money – half from Housing New Zealand and the rest from Jack’s Point developers.
Interestingly, QLDC and its quango should drop one of its stated affordable-housing goals, recommends Figenshow.
“Implement[ing] policies to help increase wages and salaries in the local economy” should be knocked on the head, he says.
Though Figenshow doesn’t say why, it’s likely the recession has put paid to this pipe dream.
Local firms are still likely to see the affordable-housing quango put its begging bowl out, however.
One policy recommended by Figenshow as a “priority item” for 2009 is: “Develop and promote employer housing funding schemes for employees.”
The QLDC quango is nevertheless at a crossroads.
First, future Wellington funding is up in the air with the National Government reviewing Labour’s Affordable Housing Act passed last September.
And local developers are vowing to fight tooth and nail to overturn a QLDC district plan change levying them for affordable-housing contributions.
The question over developer levies may not be finalised by the Environment Court until 2010, Figenshow says.