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It Is Now Time For Phil Heatley To Be Sacked Or Resign

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Brian Dalley
Brian Dalley

Gateway Housing Assistance, KiwiSaver home ownership assistance, Welcome Home First Steps, the Housing Innovation Fund and the Tenant Home Ownership Programme.

Not one workable solution!

“Gateway” will be yet another useless tool in the affordable housing tool-box.
The Green Party has blasted a new Government housing programme, saying it will do little to address the country’s affordable housing crisis and I agree.

In fact I will go a step further and ask that Heatley be sacked or resign and let someone that can fix the problem take over.

I have been sending suggestions for years based around the lasted proposal “Gateway Housing Assistance” however Heatley and his experts after putting their spin on it have destroyed any chance of the proposal working.

The scheme allows purchasers to build or buy a property, while deferring payment on the land.
Workable, but not in its current form!

This is an idea I have had for years and constantly tried to get the experts to adopt it so you can image my delight when I thought they had.

At last I thought, and then I read further...

This programme, in its current form will do little if anything to address the shortfall of 70,000 houses identified in the Government taskforce’s housing report. On top of this shortage a recent Government taskforce report found that, between 8,500 and 20,000 NZ households have extreme housing issues. Plus I have been reading for months now that there are over 10,000 families on the state house waiting list.

If what I am reading is true or only half true, something workable needs to be done and now.

To add to this, the Prime Minister John Key and his Government has cut money for upgrading and acquiring state houses from $120 million to just $18 million in this year’s Budget. That I dare say isn’t going to help those living in the 8500 to 20,000 homes with extreme issues.

What is Gateway?
Gateway enables first home buyers, or community housing organisations, to defer paying for Crown and Housing New Zealand Corporation land for up to 10 years.
This means Gateway customers can concentrate on the important tasks of designing and building their new home, moving in and starting to pay off the mortgage they have on their house.
Interest payments on the land
3 percent of capitalised interest (meaning you don’t need to pay it back regularly) is calculated annually and added to your original Gateway balance.

An example:
Gateway amount at $120,000
3 percent of that amount ($3,600) added each year
After 10 years, the balance of your Gateway would be 10 years x $3,600 + the original $120,000 = $156,000.
Interest on the land is charged from year 6, but at reasonable amounts.
These work as follows:
Years 6 and 7 - 1 percent of $120,000 = $46 fortnightly
Years 8 and 9 - 3 percent of $120,000 = $140 fortnightly
Year 10 - 5 percent of $120,000 = $230 fortnightly
There is no interest charged on the interest added on the principle amount.

After 10 years of living in their new home, individuals or community housing organisations need to buy the land.

Who is going to finance it?

If you’re unable to refinance Gateway, you will need to consider if home ownership is right for you.

How will anyone know for sure until the time comes to finance? In other words they will be entering into an agreement without knowing the outcome.

There are so many unanswered questions I have my doubts that more than 50 people will be housed in this way. A far cry from the 10,000 on the waiting list.

The government already have land, which could help alleviate the problem. Houses built on ¼ acre sections.

Just one example as I am running out of space. It is possible to purchase a fully self-contained 1 brm transportable unit for less than $30,000 that can be placed on the back of sections that are large enough to accommodate a 7.2m x 3m unit. A very practical, yet affordable solution.

As for the Gateway Housing Assistance Scheme, yes it is workable, but not in its current form. Phil, I’m sorry to say this but if you were employed in the private sector you would likely be clearing your desk out about now. But as you are not, I guess you will be safe for a while yet.

Brian Dalley is a former NZMBA Mortgage Broker, Property Investor, and Real Estate Agent with over 15 years experience in the industry.  You can read more of his and other professional’s views and opinions on his website  

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