The Salvation Army has put forward its answer to the country's housing affordability crisis.

It wants the Government to stump up $1 billion a year to buy homes in partnership with low-income Kiwis.

The scheme would see 50,000 Kiwis - who would otherwise be stuck in the rental market - buy their own homes over the next decade; The Government would contribute as much as 40 per cent of the upfront cost of each house with the buyer paying the rest,

It's a radicle and costly plan; the Salvation Army freely acknowledges this, aimed at helping families facing the reality of renting for the rest of their lives.


The call comes as Kiwi home ownership rates have fallen from 74 per cent to 63 per cent.

House prices have increased markedly in recent years and, although the market appears to be settling down, the rapid rise forced many out of the market.

For families already struggling to balance their family budgets, saving a deposit for their first home must seem an impossible task.

The Salvation Army and other commentators believe that KiwiBuild, a Labour initiative which promises to build 100,000 affordable houses for first-home buyers in the next decade, is unlikely to have a significant impact in addressing falling homeownership rates.

The reason for this is that because house prices are so high in some areas of the country, it is still an unaffordable option for many.

The proposal put forward by the Salvation Army will no doubt help more Kiwis get on to the property ladder but is it the right course if action?

It will do little, in my view, to address the long-term issues of housing affordability.

There is no quick solution to that issue, but the best way to address it is by increasing the supply of homes. Special Housing Areas and Kiwibuild will hopefully address this over time.


Along with freeing up more land for development, those initiatives remain the best bet for now.