Government efforts to solve Auckland's housing crisis have been dealt a major blow by a weak response to a request for proposals to build 1000 new homes for social housing tenants.
Community housing providers say they have proposed a maximum of only 239 new social housing places, because of problems finding suitable land and because capital funding for the new places this year has been capped at only $13.55 million.
This year's Budget documents show that the Ministry of Social Development (MSD) expects to contract for only 175 new homes from community providers in the financial year that started on July 1.
Community Housing Aotearoa director Scott Figenshow said the shortfall showed that the Government would have to increase capital funding if it genuinely wanted to house families now living in cars and garages. "We are in a housing crisis, we need to get houses built and delivered for families in need. Anything that puts constraints around that is a barrier," he said.
"Why [reject] perfectly legitimate offers simply because the cost could be very slightly over their parameters?"
The Request for Proposals, published on November 25 last year and open until November 25 this year, seeks 1000 additional social housing units in Auckland by June 2018.
The request offers to guarantee income-related rental subsidies for up to 25 years to providers who agree to take tenants from the social housing waiting list. Tenants will pay 25 per cent of their incomes in rent and MSD will top up the providers' income to agreed market rents.
The offer also includes "a separate capped-fund development fund" for upfront capital costs, and a property finder's fee and a tenancy management fee for properties leased from private landlords. But the May Budget cut these capped funds from $20 million in the year just ended to $13.55 million this financial year, apparently reflecting the small number of proposals so far.
A Herald survey of the Auckland Community Housing Providers' Network found that only five of the 10 network members have submitted proposals, totalling between 225 and 239 homes.
Keys Social Housing, owned by the Hamilton-based Wise Group, has proposed 157 to 170 new homes, mainly for people with mental health issues, in South Auckland.
VisionWest chief executive Lisa Woolley said she proposed 35 new homes to be built as part of a larger private housing development, but the developer was still waiting for council consents.
Smaller proposals include projects by the Methodist Church's Airedale Trust on two church-owned sites in Mangere (13 homes), the North Shore's Bays Community Housing Trust (6 homes), and another trust which asked not to be named (14-15 homes).
MSD deputy chief executive Carl Crafar said he could not comment on the results of the process because it was not yet complete, but he said there was no cap on upfront funding for any particular project.
"The funding is negotiated on an individual basis," he said.
new social housing units sought in Government tender
225-239 units proposed
175 units budgeted for in this financial year