Prime Minister John Key announces $1 billion fund to address housing crisis

Auckland (Syed Mujeeb) New Zealand Prime Minister John Key has announced a new $1 billion fund to fast-track infrastructure development by councils with high new housing demands.

The councils currently eligible to access the fund for such things as water and roading development are Auckland, Hamilton, Tauranga, and Christchurch.

They are the cities that are expected to have more than 10 per cent population growth in the next 10 years.

The Government has not yet decided how the fund will be structured but it will require an extra $1 billion in borrowing., The fund will own or finance the infrastructure until the councils receive rates revenue from the new houses.

Mr Key made his announcement in a speech to the National Party conference in Christchurch.

He said the Housing Infrastructure Fund would accelerate the short and medium term supply of new housing where it was needed most.

“It will do that by investing upfront in infrastructure to ensure more housing can be built in a timely fashion.

“To access the fund, local councils must outline how many new houses will be built, where they will be built and when they will be available,” Mr Key said.

“Ideally, they will have agreements with developers.”

It would be tightly targeted at core infrastructure that supported additional new housing.

Funding might have other conditions attached, such as faster processing of resource consents.

Auckland Mayor Len Brown welcomed both the infrastructure fund and future establishment of urban development agencies and looked forward to reviewing the initiatives in detail.

“This is a welcome proposal for all high growth areas, but in particular Auckland where we face significant housing challenges,” Mr Brown, who was unavailable for interview, said in a statement.

“We have been talking with the government for some time about further steps to increase the pace of new home building in Auckland and funding for infrastructure has been a key and crucial component of these discussions.

“While we are yet to see the details, these initiatives could contribute to the acceleration of housing supply in Auckland without increasing the burden on ratepayers or adding to council’s debt levels.”