Two high-profile Waikato business leaders are at the forefront of efforts to boost housing affordability as many in the region struggle to get on the property ladder.
With home ownership rates dropping as low as 50% in Hamilton, following a three-decade slide, Simon Perry, chair of the Perry Group, and Leonard Gardner, chief executive of Fosters, are touting very different solutions.
One involves high-rise apartments on land close to Hamilton’s CBD, the other is a leasehold model on Cambridge’s outskirts. In both cases, homes are likely to be available for around $400,000 or less.
Housing marks a departure for Perry, who is also chair of the Brian Perry Charitable Trust which has focused on health and wellbeing ventures including Te Awa River Ride.
He said he realised there were more fundamental needs around getting people into home-ownership and a year ago he helped establish Bridge Housing Trust to offer affordable houses.
Peake Mews in Cambridge already has its first houses on the market using a leasehold model in which the owner buys the house and pays rent on the land.
Bridge Housing Trust general manager Jennifer Palmer said Peake Mews would be the first of many such developments, made possible initially because it is on land gifted by the Brian Perry trust.
It has also borrowed about $3.1 million interest-free from the Progressive Home Ownership Fund, established by the Government in 2020.
Perry said the trust’s move into the sector follows generations of underinvestment in housing, and a gradual slide for so-called generation rent, with problems ahead as people retire with no equity.
A society of haves and have-nots has been developing, he said. “It’s a little bit concerning.”
Gardner’s initiative is a proposed high-rise development on the Sonning carpark site in Claudelands. As with Peake Mews, apartments will all be owner-occupied.
Gardner’s concept, on heritage Claudelands’ doorstep, met early opposition when it was leaked. Former deputy mayor Gordon Chesterman called a public meeting out of which Guardians of Claudelands is being formed.
“The concern isn’t about affordable housing but about appropriate use of a site next to Hamilton’s most important historical suburb,” Chesterman said.
He said Sonning is on an historical pā site, and his group is working closely with Ngāti Wairere, as mana whenua.
Gardner wants people to suspend judgement until a more developed picture is presented, probably early next year.
He said they would not be rental properties, but affordable, owner-occupied housing. “They [owners] are provided with that opportunity to build some equity which can come through property ownership.”
He is also concerned with ongoing affordability, which may see capital gains controls put in place. “It’s more than just the initial affordable price, it’s how do you create affordability in the long term?”
He said social housing is important but his own “personal passion” is helping people step onto the property ladder.
He wanted to provide people with opportunities they may not otherwise have. “I feel a bit of responsibility to try and help.”
Waikato Housing Initiative co-chair Nic Greene said the organisation has a target of making 20% of new housing affordable.
He said councils had levers they could use around zoning and policy. One such lever is inclusionary zoning, requiring an affordable housing component in new developments.
Palmer described the approach, pioneered by Queenstown, as a tax on developers. “When a commercial development is happening, inclusionary zoning says 5% of that development must be earmarked for affordable housing.”
Hamilton Mayor Paula Southgate said the incoming council was likely to look at inclusionary zoning through the district plan review. “I would be really surprised if that topic does not come to the fore within the next couple of months.”
Written by Richard Walker, as published in the Waikato Times on 15 October 2022