The sale of council housing in Hamilton

From next week, community housing providers have the option of purchasing Hamilton City Council pensioner housing. What does this mean for the future of social housing in Hamilton?

Social housing (housing provided at below market rents) in New Zealand is provided by the government (through Housing New Zealand), councils, and a number of community housing providers. Councils have played a particularly important role in housing older people, who experience a number of disadvantages in the private rental sector.*

In 2013, the government announced changes to how it funds social housing. Community housing providers have access to capital grants via the Social Housing Fund, and access to funds for ongoing costs via the income related rent subsidy. The income related rent subsidy, previously only available to state tenants, can also be paid to tenants of community housing providers. Councils, however, cannot register for either of these funding sources, so they do not receive that same support.**

Their exclusion from these government funds – councils cannot register as community housing providers – is one of the justifications given by Hamilton City Council for the sale of its pensioner housing.

At the end of November, Hamilton councilors voted to sell the remainder of council owned housing. The council argues that community housing providers will do a better job than council, and they’ll be helped in this by extra funds:

“Social housing providers are in a better position than the Council to provide housing for older persons. Social housing providers have access to increased government funding that the Council is not eligible for. They can also offer much wider, wrap-around social services such as meals, outings and health care. The Council is not in a position to offer these.” [source: FAQs pdf]

It is good news that the housing will remain as social housing. This is partly thanks to the committed advocacy of Hamilton city tenants and social service organisations. When the sale of the houses was originally proposed, it was for sale on the open market, in the same way that other complexes of city housing were sold. Now, while tenants’ landlord may change, they’ll be able to remain in the home. If the houses aren’t sold to community housing providers, the council will retain ownership.

However, I’m still concerned about the long term consequences of this decision. Housing sold to other providers is only required to stay as social housing for ten years. This means that the future stock of social housing in Hamilton is not protected. While I appreciate that the council hopes that having stock will enable community housing organisation to increase the total social housing stock, we don’t know for certain how this will play out.

It’s more important than ever that we have a good stock of social housing in Hamilton. With some evidence that Auckland workers who can’t afford homes in that city are moving to Hamilton to commute, it seems like housing pressures in Hamilton are only going to increase.

* For a great review on the research on renting as an older person, see: Sally Keeling (2014), Later Life in Rental Housing: Current New Zealand Issues, Institute for Governance and Policy Studies.

** As Hamilton City Council sees it [pdf]:

Recently the government made changes to the law which included establishing the Social Housing Unit to administer a capital grant fund for building, and making income related rent subsidies available to social housing providers. Only registered social housing providers (including not for profit organizations, church and iwi groups) can access both of these. Councils cannot apply to be registered as a social housing provider.

1 Comment

  1. Kevin Reilly says:

    Thanks Elinor. Interesting submissions on the sale of pensioner housing in Hamilton they are trying the same here starting with the idea of setting up a Trust first and then later down the line and could end up on the open market as the Trust moves on to other business opportunities.See you Monday. Kevin

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