Govt announces big boost to emergency housing

The Government has announced a massive new funding package for emergency housing, which includes 1400 extra places for homeless families and individuals.

The housing package, released this afternoon, would cost $300 million over four years, Social Housing Minister Paula Bennett said.

The new funding would allow for an additional 1400 temporary housing places at any one time, Bennett said, of which 600 would be in Auckland.

The remaining 800 places would be in areas of high demand around the country.

In total, the Government was aiming for 2200 emergency places to be available at any one time.

Joining Prime Minister John Key at his weekly post-Cabinet press conference this afternoon, Bennett said the funding would "see some of our most vulnerable New Zealanders receive the support they need".

Housing NZ would repay the loan through rental subsidies and the sale of properties that were no longer needed as more permanent housing came on stream.

This meant the loan was "fiscally neutral", Bennett said.

Asked whether the major funding package was an admission there was a housing crisis, she said the Government was "unapologetic" about stepping up and addressing a need

Of the $300 million in funding, $120 million would go towards building, buying or leasing properties which were suitable for housing homeless people.

Most of it would be loaned to the state housing corporation, Housing New Zealand.

The $100m loan to HNZ was not money the corporation would have otherwise had received, Bennett said.

"It is quite separate from their permanent build."

Another $71 million would go into rental subsidies and $102m would go to social housing providers to support tenants into permanent housing.

Bennett said some of the new emergency housing places were already being worked towards, including Luke Street in Otahuhu, on land earmarked for a future school.

The new funding would provide economic stimulus, she said, including modular housing projects in the regions.

Asked if it would add to an overheated property market and put pressure on an already stretched construction market, Bennett said most of the spending would be on temporary housing.

"I don't think it will have a wider effect on the housing market."

There are roughly 1500 people on the Government's housing register, which was people in insecure housing.

"There will be extra beds coming onboard all of the time. The first ones are due at the end of November," Bennett said.

"We are looking at every opportunity we can...and now we are able to pay for them."

The Government recently began directly funding emergency housing for the first time following a review of the sector. Until last year, emergency housing had been left to charities.

An initial $2.5m in Government funding was followed by a $41.1m investment in the Budget, which paid for around 3000 housing places for families or individuals a year in existing shelters.

The funding was announced as reports of people living in cars and garages in South Auckland put a spotlight on the issue.