Te Awa Lakes housing development. Photo/ Stephen Barker
The Government has signed off on a new funding model for 1500 homes at the Te Awa Lakes development in the Waikato.
Housing Minister Chris Bishop approved the use of an Infrastructure Funding and Financing Act levy to help pay for infrastructure.
Te Awa Lakes is a 100ha, 2500-home, three-stage development for the old Perry sand quarry at Horotiū.
Stage one is already underway, with the first 12 homes completed in March 2026 and a further 22 on the way.
Under the new funding model, the Te Awa Lakes development receives up to $50 million for water and roading infrastructure, supporting 1500 of the 2500 houses.
The model allows for infrastructure to be financed outside council balance sheets through a special purpose vehicle, with costs repaid over time via a levy on homeowners.
The levy, to be disclosed to buyers before they purchase a house, will be administered by Hamilton City Council and repaid over 30 years from July 2027.
The council will collect the levy on behalf of the project’s special purpose vehicle, with charges appearing alongside homeowners’ quarterly rates bills.
The council’s financial support services manager, Matthew Bell, said the levy would be administered through existing rating systems, similar to standard rates and water charges.
The charges will begin from July 1, 2027, with the amount set annually for each property.
For people looking to buy in Te Awa Lakes, the levy means that part of the cost of the infrastructure is paid over time rather than being built into the upfront purchase price.
The developers said the newly approved funding model could be a turning point.
Te Awa Lakes managing partner Richard Coventry said it would make a “massive difference” to getting projects moving.
He said that without the funding tool, infrastructure delivery would rely solely on developer funding, slowing progress and struggling to keep pace with demand.
“Under the traditional model, developers have to fund everything up front. That means relying heavily on pre-sales and bank lending, which can be incredibly difficult,” he said.
“Having a tool like this is really important to open up housing developments and get that core infrastructure in place.
“We fully anticipate this will accelerate housing construction and unlock other developable land in the northern gateway of the region,” he said.
The first homes financed under the new model are expected to be built as early as 2029, Coventry said.
Bishop said infrastructure constraints, like council borrowing limits, had been a major handbrake on new housing.
“Developers and councils have made it clear there are significant bottlenecks when it comes to enabling infrastructure,” he said.
Councils were responsible for delivering services like water and roads, but debt limits could delay investment, even when housing projects were otherwise ready to go.
“Developers with viable projects should not be held back by this,” Bishop said.
Bishop said the new funding approach ensured “growth pays for growth” and formed part of a broader push to improve housing affordability.
Te Awa Lakes is also being supported by the Government’s Greenfield Model, administered by National Infrastructure Funding and Financing Limited, which supports development by lowering financing costs during the project’s construction period.
The development sits within Hamilton’s high-growth future proof strategy area, where about 61,000 additional homes are expected to be needed by 2050.
Coventry said Te Awa Lakes was a mixed-use community combining residential, commercial, retail and recreational spaces.
Among the 2500 homes that are ultimately planned at Te Awa Lakes are premium riverside properties, townhouses and apartments near a proposed village centre.
For secondary education, Te Awa Lakes is zoned for Fraser High School and Ngāruawāhia High School.
Coventry said the project included 10% affordable housing.
He also placed a strong emphasis on environmental design, including stormwater lakes and wetlands developed in partnership with tangata whenua.
Coventry said those features would serve as key infrastructure and central community assets.
Te Awa Lakes is among the first three housing developments to use the Infrastructure Funding and Financing model, which the Government is now looking to expand.
Waikato District Council Mayor Aksel Bech welcomed the news.
“This a good example of how growth can be enabled responsibly, with infrastructure funded by those who benefit from it, while supporting wider economic activity across both Hamilton City and Waikato District.
“Ensuring there are a range of housing options, including more affordable homes, is critical for the future of the Waikato and for supporting people who live and work in our district,” he said.
The project has been on the cards since 2016, with planning consents received in December 2020.
Earthworks began in 2021.
Tom Eley is a multimedia journalist at the Waikato Herald. Before he joined the Hamilton-based team, he worked for the Weekend Sun and Sunlive. He previously worked as a journalist at Black Press Media in Canada and won a fellowship with the Vancouver Sun.