Shared equity programmes could help more Bay of Plenty first-home buyers struggling to get on to the property ladder, housing experts say.
Experts at a SmartGrowth Housing Affordability Forum workshop looked at shared equity programmes and impact investment as opportunities to bring more affordable housing choices to the region.
Contributors to the workshop included experts in affordable housing, urban design and planning, community housing provision, innovation in housing, economic development and papakainga housing developments, as well as philanthropic organisations.
Shared equity was freehold housing with at least 60 per cent contributed by the homeowner, supported by a trust that has received investment funds for this purpose.
The return on investment would be determined by the housing market and divided as per the final ownership proportions when the property was sold.
Community Housing Aotearoa chief executive Scott Figenshow said shared ownership was a way for families to be able to purchase a portion of a home using a 'tenants in common' legal agreement.
For example, a family could use their mortgage and deposit to buy 70 per cent and a community housing provider owned the other 30 per cent of the property.
If the house changed in value when the family decided to move out, a new family could offer to buy out the previous one, or the trust could offer to cover more of the cost if they could only provide 50 per cent of the share.
"It is able to be tailored to the household," he said.
There were about 210 homes under the Auckland New Zealand Housing Foundation and about 160 in the Queenstown Lakes Community Housing Trust using the shared equity scheme.
Mr Figenshow believed shared equity would work in the Bay too but there were several options for how the scheme could be funded and resourced, including advocating to the new government for direct capital investment into community housing providers.
Nga Potiki a Tamapahore Trust deputy chairperson Victoria Kingi said the treaty settlement tribe was proposing to engage the shared equity scheme.
Ms Kingi said 30 Nga Potiki members were going through a supported process for bank pre-approval to borrow funds to own houses on treaty settlement land in Papamoa East.
The tribe owned 50 acres of Te Houhou settlement land that they had negotiated early settlement release from the Crown to build a residential development which was made up of market-led and quality affordable Nga Potiki housing.
Ms Kingi said the houses were made affordable through the shared equity scheme.
"It means tribal members will be able to buy house and land packages at market prices subsidised by the tribe through the shared equity scheme," she said.
"We are locking in affordability and future-proofing it for families to eliminate anybody trying to benefit from profit that was not charitable."
Tauranga Community Housing Trust manager Chris Johnstone said shared equity was something the trust was interested in and would continue to explore.
"However, we are mindful that it needs good support, a sturdy framework and specific expertise."
Priority One's communications and projects manager Annie Hill said shared equity schemes in New Zealand had a successful track record.
"Philanthropic organisations and other investors invest in a fund, understanding the return will be determined by fluctuations in the housing market," she said.
"The fund is then managed by a community housing provider or a trust."
Forum spokeswoman Christine Ralph said the workshop aimed to facilitate new ways of thinking about affordable homes and hoped social housing providers at the forum would adopt the strategy in the Bay.
Mrs Ralph said it was likely the housing providers would view the results of the latest SmartGrowth housing assessment for the Bay and decide whether they would follow the approach or not.
"It just means now affordability becomes a possibility for a lot more people," she said. "I think it is an innovative way to look at financially. If you can find groups that are willing to implement it it will be good for the community.
"As soon as we can get one or two in operation, the rest of the community can see how it works and gain confidence in it and it will be a snowball effect."
Mrs Ralph said a second workshop would be held early next year to consider how a shared equity scheme might work at a local level.
First National Mount Maunganui, Tauranga and Omokoroa owner Anton Jones said on the surface this type of ownership model could certainly have some merits for those who were struggling to be able to afford a property on their own, or come up with a large deposit.
"Owning a home is most Kiwi's dream, but it is simply out of reach for some at present, so any assistance like this people can get with getting onto the property ladder surely must be beneficial," he said.
However, Mr Jones said it would depend on the finer details and advised anyone looking at a scheme like this seek independent advice. "Make sure the trust and a people involved have a good track record and it is the right model for them."