Tararua District Council considers housing sale U-turn

Sold: The Tararua District Council has sold its Hovding Court flats, but is reconsidering further sales.

Higher returns from rentals and a booming demand could help sway Tararua District councillors into doing a U-turn on an earlier decision to sell its pensioner housing to responsible housing providers.

'This has been an issue for the council for a number of years now," said Malcolm Thomas, council's strategy and policy advisor.

The previous sale of some of council's older units now means the current portfolio is in a good state, Mr Thomas said, telling district councillors there is very high demand, with an incredible turn-around being felt in the marketplace for rentals now.

"There are only six properties to rent throughout the Tararua of any size, with no one-bedroom units available at all," he said.

With council's pensioner housing going from "many" vacancies to just one in Eketahuna and people queuing for any others when they become vacant, the market has turned in a big way.

But there is considerable stress on council's staff, which is running lean, Mr Thomas said.

"With a waiting list, pressured staff are having to make decisions on who gets a unit," he said, as he proposed council employ a .5 staff unit to help manage the property portfolio.

"This would be funded from rental activity, not from the ratepayers, because we have to do this properly," Mr Thomas said.

The demand for pensioner housing could see rentals rising by $6 a week and councillors now have two options regarding its housing stock.

It can continue with its 2015 Long Term Plan option to sell pensioner housing or it can defer its sale programme and consult again with the public.

Last time the public was asked to submit views on the issue, the feedback was evenly split between keeping or selling the units.

Former Dannevirke Community Board member and social housing advocate, Tim Delaney said whether or not council decides to postpone the sale of the housing assets it owns, the issue is still a vexing one.

"There are those who propose that central government should build up a stock, in the belief this will produce more affordable housing, but this has proven to be a failed option because management of the stock becomes too mechanical and impersonal. Central government is too remote," Mr Delaney said.

"There are those who believe neither central nor local government should be in the housing business and they should leave it to 'the market,' that is to say, private enterprise. However, for-profit enterprise must have sufficient competition in the market to produce benefits for the consumer."

However, Mr Delaney said he believes there is a third option.

"Local government, in partnership with local community-builders (service clubs, local trusts, local NGOs, churches, etc), can deliver both robust cost efficiencies and compassionate care in joint enterprises. This is because such a partnership is local, and because local means invested in your community.

"Pensioner housing is one area where such a partnership could invest lots of energy and passion and exercise more-than-sufficient fiscal prudence and careful management to produce a result that would benefit the whole community."

The Tararua District Council is respected for being a good landlord, with the units well maintained, but some built 50 years ago require upgrades.

"Some of the heating is very old," Mr Thomas said.

"There are bar electric heaters and only six have heat pumps, partly funded by the tenants. But tenants can't afford this cost."

With $1.2 million in reserve from the previous sale of units, council has funds for the $2500 needed for heat pump installation, as well as upgrades to kitchens and bathrooms, at a cost of $30,000 for the oldest units, and for underfloor heating for the Woodville units.

Although Mr Thomas warned councillors of the need to be careful the reserve is maintained, councillor Shirley Hull said it was important to be good landlords.