Average house values in Rotorua are approaching $700,000 but a new iwi-led development will offer first-home buyers a lifeline with new builds from $500,000.
The Wharenui Rise development is part of a housing project announced last year aiming to build 1000 homes. Stage one of the project has a goal of 200 homes over the next three years.
Now Ngāti Whakaue Tribal Lands has announced the launch of its "exciting" scheme to include affordable homes in the development and help address the housing shortage in Rotorua for whānau and shareholders.
Of the first houses built, 46 will be for general market while eight lots will be set aside for first-home buyers.
Ngāti Whakaue Tribal Lands general manager Ray Morrison said the announcement was the result of a decade-long drive and was only the first step in providing opportunities to support whānau in their homeownership and housing journeys.
"It's about availability. We know there's a shortage right across the board," Morrison told the Rotorua Daily Post.
"We're making sure we are doing all we can to establish real pathways to homeownership for our people and we're utilising our land to achieve this."
The new Wharenui Rise subdivision in Ōwhata will incorporate a mix of affordable and general market homes.
Ngāti Whakaue Tribal Lands will provide eligible first-home buyers with an opportunity to purchase one of eight new homes in stage one. Future stages will offer similar proportions of affordable homes as the development progresses.
"Our site is consented for just over 200 homes which are expected to be built over the next few years – starting before Christmas. Long term we are aiming for 13 stages which may provide over 1000 homes in the next two decades," Morrison said.
"The aim is for a consistent flow of housing with construction on the first stage getting under way within the next five months."
The affordable homes would be high-quality brick and tile single-story duplexes with three bedrooms, one bathroom and one car park on 100sq m of land.
The homes will be priced at $500,000 (incl GST) to target first-home buyers.
This is more than $100,000 below the median house price in the city.
QV's latest house price index this week showed Rotorua's average house value rose by 7.6 per cent in the last quarter to just under $692,000.
This figure is 21.4 per cent higher than last year.
Commenting on the index, QV property consultant Derek Turnwald said local agents had reported lower attendance numbers at auctions while more sellers chose to negotiate prices.
The affordable home scheme at the Wharenui development will give first preference to Ngāti Whakaue shareholders and whānau, with registrations of interest open from July 12.
"To register, interested parties must meet our key criteria and requirements for eligibility. They need to be able to provide evidence of their shareholding in, or whakapapa to Ngāti Whakaue Tribal Lands. They also need evidence of how they intend to finance their purchase, for example, pre-approval from their bank," Morrison said.
Access to additional Government financial assistance such as the First Home Grant or Kiwisaver drawdowns may be available to first home buyers interested in the development.
Initial applications close at the end of September with a ballot process due to take place on October 1. Successful applicants from the ballot would be offered an opportunity to purchase a home after October 4.
Those who were not successful would be placed on a waiting list and notified if an opportunity arose for them to purchase one of the affordable homes in the future.
Morrison said the building process would hopefully begin before Christmas this year.
The affordable housing scheme is part of Ngāti Whakaue Tribal Lands' wider housing strategy which also aims to support whānau through long-term rental accommodation and kaumātua who may be interested in papakāinga housing options.
"Our Whakatauki is Mana Whenua, Mana Tāngata. We are committed to upholding the honour of both the land and the people," Morrison said.
"This is only the first step. Hopefully we'll be having a similar conversation next year because we want it to be an ongoing process."
Realty Group Ltd managing director Simon Anderson said the announcement could only be a positive for Rotorua.
"This is obviously really good news," Anderson said.
"There's a massive housing shortage and that can only be fixed with new houses."
Anderson said making homes affordable for first-home buyers would ultimately increase the rental pool as tenants purchase and move into their own properties.
Rotorua councillor Trevor Maxwell said he was thrilled by the idea.
"I was just so glad that one of the largest landholders is showing some tremendous initiative," Maxwell said.
"I'm sure residents would be pleased with these decisions."
Rotorua councillor Tania Tapsell said she hoped other landowners would follow Ngāti Whakaue's lead.
"We've seen how quickly homeownership has become unattainable for families.
"Any increase in affordable housing in Rotorua is a great thing. It's a great start."
Professionals Real Estate principal and auctioneer Steve Lovegrove said the initiative needed to be celebrated.
"We just need more houses whether they are affordable or not. We need to look after our community," Lovegrove said.
"It's delightful because [this development] will show people what affordable housing can look like, that it can be safe, healthy and insulated."
Last year a partnership between Ngati Whakaue, Rotorua Lakes Council and Waka Kotahi NZ Transport Agency was awarded $55m from the Government's 'shovel-ready" Covid response funding for infrastructure to unlock the 300 hectares of land for housing.
- Ngāti Whakaue Tribal Lands will officially announce the affordable housing strategy today from 3pm to 4.30pm at Te Papaiouru Marae, Ohinemutu, Rotorua