Time to 'pick up the pace' on housing issues
The Government has found significant problems within Christchurch's quake-pressured housing market and says both it and the private sector need to "pick up the pace" to help the city's recovery.
"Above-average" rent increases, high demand and a shortage of properties were among the housing woes identified in a Ministry of Business, Innovation and Employment (MBIE) report released yesterday.
The Labour Party and the Tenants Protection Association (TPA) say the report confirms what they already knew, but Housing Minister Nick Smith said it would help the Government "tailor our response".
He said the region's housing situation was "one of the most challenging areas in the wake of the earthquakes". The situation was "a challenge, not a crisis", he said, but the Government and the private sector needed to "pick up the pace".
"There's more demand than there is supply ... rental prices are going up and it's a pressured market."
The report found rent prices have risen more sharply than house prices, and at a faster rate than in other New Zealand regions, including Auckland.
In February this year the average weekly rent was $384, which is a 31 per cent increase on the pre-earthquake month of August 2010, when the average was $293.
Suburbs such as St Albans, Papanui and Merivale have seen rent increases of 39 per cent.
Rent prices around Bishopdale and Burnside have risen 32 per cent.
Rental inflation in northeast and eastern suburbs was below the Christchurch average but both areas still had "significant increases" of 22 per cent, the report found.
It also found the total number of rental bonds lodged with MBIE has fallen from 20,500 in the year to December 2010 to 16,600 in the year to December 2012 - a 19 per cent decrease.
The report shows the number of new bonds lodged in 2012 was the lowest since 1998.
The report identifies three main issues facing Christchurch over the next three years: increase in population, temporary accommodation for Cantabrians and accommodation for incoming rebuild workers.
Smith also said the waiting lists for Housing New Zealand and Christchurch City Council units were shorter than before the quakes. The issues were mainly affecting middle-class Cantabrians.
He did not rule out the "possibility of extra Government investment" to ease temporary accommodation and rental shortages.
Labour MP Clayton Cosgrove said the Government could no longer hide from the region's housing problems.
"They've denied it for a long, long time but now their own department is confirming it [with the report], so I think the time has come to do something about it," he said.
The information presented in the report was "totally predictable", he said.
"We've seen examples of people living in Third World conditions and it's not just the traditional lost and lonely types ... we're talking about people who are employed and are really struggling to get ahead."
Helen Gatonyi of the TPA said the report confirmed what "social agencies have known for a long time".
"The Government talk about rebuilds and new builds but those things take time ... the issues we have are present-day and we need changes now," she said.
The report did not provide any detail about the number of people living without housing security.
"It's those people who we're most worried about."
The main findings of the Government's report on the Christchurch housing situation:
- The region's total housing stock has been reduced by a net 11,500, or 6.2 per cent.
- In December last year the estimated number of rental vacancies was at an eight-year low.
- The average price of Christchurch houses rose 7.5 per cent between February 2012 and February 2013.
- The average rent is 31 per cent higher than in August 2010.
- Suburbs in the north and northwest of the city have experienced "above average" rent increases.
- There has been a significant decline in the amount of available rentals costing less than $300 per week.
- More than 8000 new houses will be needed in the next four years to keep up with population growth.