Kāinga Ora gets Housing Minister Chris Bishop’s sign-off to sell 171 state-owned properties in Ormiston, Auckland

Housing Minister Chris Bishop has signed off on the sale of 171 state-owned properties in Auckland. Composite / NZME

Kāinga Ora has conditionally sold 171 properties in South Auckland, sparking criticism over why it wasn’t using the land for state housing.

The properties are on a plot of land the last Government paid around $40 million for when it stepped in to salvage a KiwiBuild project in 2023.

Kāinga Ora won’t say how much it sold the land for but said the taxpayer will be making a profit on it. It also maintains the properties were never intended for state housing.

The 171 properties sold were part of a wider development at Ormiston. The first stage was a tranche of almost 60 KiwiBuild homes sold to first-home buyers under the then-Labour Government policy.

Kāinga Ora stepped in to bail the subdivision out after the developer hit trouble as sunset clauses threatened the deals done by KiwiBuild buyers.

The agency’s urban development general manager Nick Howcroft said the new buyer intended to use the land for “market and affordable housing”.

He said it had previously been planned as part of the third stage of the Ormiston Rise subdivision.

He said for the sale to go ahead, Minister of Housing Chris Bishop had to give his approval, which he had done.

Ormiston Rise is a development of 730 homes in southeast Auckland. Photo / Sylvie Whinray

Howcroft said Kāinga Ora agreed to buy the land in 2023 “to ensure first-home buyers who had bought KiwiBuild homes in stage one of the development got their homes completed and handed over to them”.

“The developer was under financial stress at the time.”

The deal was pushed through by the Government despite Treasury advising against the purchase, saying it risked setting a precedent of governments supporting developers facing financial difficulties.

Bishop said his agency “purchased this land because the previous Minister of Housing asked them to”.

He said his only involvement was approving the sale as was legally required for it to go ahead.

Labour’s housing spokesman Kieran McAnulty said Kāinga Ora could have used the properties for social housing. Instead, the sale of the 171 lots meant the growing demand for social homes would not be met.

He said the focus of Labour’s new capital gains tax policy had been on injecting money into health but it was also expected to impact on the housing market.

Kāinga Ora owned or managed about 72,000 homes, with a further 14,000 managed by community housing providers.

There are about 24,300 people on the higher-needs waiting list for a state home, down from 26,900 a year ago.

Each recent month has brought about 2000 more people seeking homes on to the waiting list, from which about 900 were provided homes.

In June, Kāinga Ora said it planned to sell about 900 homes before the end of 2026, along with a fifth of its vacant land.

It also said it planned to stop about $220m of projects.

The housing agency said it sells some of its stock to balance its housing portfolio. For example, getting rid of those that are the wrong type of home or in the wrong place.

Clarification: This story was updated to clarify that Kāinga Ora says it never intended to use the land in question for state housing.

David Fisher is based in Northland and has worked as a journalist for more than 30 years, winning multiple journalism awards including being twice named Reporter of the Year and being selected as one of a small number of Wolfson Press Fellows to Wolfson College, Cambridge. He first joined the Herald in 2004.

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