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The cap on the first home loan program removed

Budget 2022 sets up an Affordable Housing Fund, a new program the government says is designed to cover people’s rental costs if they can’t access public housing.

“The 350 million dollars fund will be based on partnerships with investors, philanthropic organizations, promoters and the affordable housing sector to expand the range of housing options for people whose needs are not currently met by the market,” said Housing Minister Megan Woods.

The first stage of the fund would offer $50 million in grants to non-profit organizations to provide affordable rental housing in Auckland, Tauranga, Rotorua, Napier/Hastings, Wellington and Nelson/Tasman.

The $ 350 million comes from the residential development fund announced in 2020. It was intended to support the construction sector during the initial locking of the pandemic, but was not used. Of the total, $294 million would be for grants and subscriptions, $6 million for administration, and the remaining $50 million for low-interest grants.

In April, the Green Party called on the government to freeze rents until tougher rent controls are in place.

Greens co-leaders James Shaw and Marama Davidson said it would help rebalance the rental market in favor of tenants.

According to Trade Me’s March Rental Price Index, the amount of rent paid by tenants has increased by about 7% over the past year to the end of March and now stands at around $575 per year. week.

A November 2021 report from the Ministry of Social Development revealed that more than 60 % of low-income tenants in New Zealand in 2018 spent more than 40 % of their income just to cover the rent-the worst OECD ratio.

First-time home buyers

There will be no more caps of housing prices on the first real estate loans, which are designed to help buyers from a first house with their deposits if they meet certain criteria, from May 19 of this year.

Woods said it would give first-time home buyers more choice of homes.

Loans are issued by selected banks and other lenders, and underwritten by Kāinga Ora to enable the lender to make loans which otherwise would not meet their lending standards.

House price caps on first-home grants have also been increased in most major cities, including Auckland (from $700,000 to $875,000), Hamilton ($600,000 to $725,000), Tauranga (600 $000 to $875,000), Wellington ($650,000 to $925,000), Christchurch ($550,000 to $750,000) and Queenstown ($650,000 to $925,000).

These changes would come into effect from June 1, 2022.

Woods said that would mean caps would better align with bottom-quartile market values ​​for new and existing properties.

“We believe that these changes, as well as other changes to the eligibility criteria, will help thousands of other buyers from a first house, with available funding for around 7,000 additional subsidies for the first house and 2,500 additional loans for the first house available each year,” she said.

People told 1News last year that the First Home grant scheme was becoming increasingly “useless” in their area because house prices were too high to qualify.

Housing prices have increased significantly during the pandemic. However, experts polled by the Reserve Bank predicted that house prices are expected to decline slightly in most major cities this year.

Woods said house prices and income caps will now be reviewed every six months to ensure they stay up to date.

The 12 experts interviewed in the official survey on the cash rates of the Finder RBNZ of this month said that Auckland, Hamilton, Tauranga, Wellington, Christchurch and Dunedin will not see any increase in real estate prices, most of them places registering a reduction.

The treasury updated forecasts, published Thursday, indicate that housing prices have increased by almost 30 % compared to 2021. This growth should slow down this year, drop slightly next year, then slowly increase by the after.

The Kāinga Whenua loan cap would also be increased from $200,000 to $500,000 effective June 1, 2022.

Woods said it would give people building, moving or buying a house on whenua Māori more choice.

Another $1 billion of total operating funding would be allocated to support increased public and transitional housing stock.

Un financement de fonctionnement total supplémentaire de 75 millions de dollars ira au plan d’action pour les sans-abrisme et 355 millions de dollars de financement de fonctionnement total financeront des changements dans le système de logement d’urgence pour améliorer les résultats en matière de lodging.

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