Time to 'pick up the pace' on housing issues
The Government has found significant problems in Christchurch's earthquake-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," he said.
City councillor Glenn Livingstone said he was ''fed up with ministers continually reframing and minimising the housing crisis facing Christchurch''.
"They cannot bear to bring themselves to admit that there is a housing crisis, despite the overwhelming evidence,'' he said.
"If the Housing Minister, the Hon Nick Smith, is now describing Christchurch's current housing situation as a 'challenge', then what would a crisis look like?"
Livingstone said evidence of the crisis was outlined in the MBIE's report, much of which was covered in the 2012 Christchurch housing summits he initiated.
"We heard from housing stakeholders last May and June what we are hearing from MBIE now, nearly a year later, namely that there is a rental squeeze, that there is a housing affordability crisis and that many have been and are living in substandard housing conditions."
He said dimensions of the crisis could be seen in the cost of housing, the 31 per cent increase in the average weekly rent since August 2010, a lack of social housing and the capacity of unresolved insurance claims.
He said the council was aware of people living in cars, with 27 being counted in the New Brighton Beach car park recently.
"I would say to the minister that the housing situation in Christchurch is not a challenge to monitor, that in fact it is a crisis - the water is now pouring through the roof," he said.
The MBIE 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-quake 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 in 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 that 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 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".
"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," he said.
Helen Gatonyi ,of the TPA, said the report confirmed what "social agencies have known for a long time".
"The Government talks 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," she said.
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 a week.
- More than 8000 new houses will be needed in the next four years to keep up with population growth.