Think-tank to home in on housing

"The rents have certainly been climbing for the last nine months.'' Waikato Property Investor Association president Daryl Fisher

Blue-sky thinking is needed to overcome the housing crisis but people locked out of the property market are finding their own solutions.

Some are filling their backyards with transportable cabins.

Housing and Urban Development Minister Phil Twyford has appointed three independent experts – economist Shamubeel Eaqub, Otago University Professor of Public Health Philippa Howdenchapman and the Salvation Army’s Alan Johnson – to lead an independent stocktake of the housing crisis. Their report is due before Christmas.

‘‘This report will help the Government refine and focus that work where it is most needed,’’ Twyford said on Saturday when announcing the appointments.

The rise in house prices and shortage of rental properties had caused the demand for mobile cabins to shoot up, Just Cabins franchisee Fenton Peterken said.

Just Cabins is one of a number of cabin providers on the market.

‘‘We’ve seen increased demand for a lot of reasons,’’ Peterken said, ‘‘certainly [because of] rising house prices, the LVRS [loan to value ratios enforced by banks], increased rents, increased population. And there has been a flowon effect from earthquakes as well.’’ Peterken rents out the insulated cabins but they were only a temporary solution, he said.

He has delivered them to where people have been living in overcrowded conditions – sleeping in the lounge or in tents in the backyard.

Peterken has dropped off a cabin to a home only to deliver another two a few months later.

Twyford appointee Howdenchapman has seen cabins and converted shipping containers pop up in Auckland and Wellington, and said they were an indication of overcrowding.

‘‘People are stuck in a position where they don’t have anywhere else to go to and they are trying to lower the rent per person,’’ Howden-chapman said.

There was a lot of sense in that, she said, but there were health and mental health issues.

‘‘There is, probably, still just one toilet in the house.

‘‘There is, probably, still just one kitchen in the house. So it’s putting pressure on the infrastructure and, most particularly, the social infrastructure.’’

Twyford’s stocktake will look at homelessness, the state of the rental market, the decline of home ownership and more.

According to the Trade Me property rental index released in November, the number of rental properties to choose from has dropped 50 per cent in the past year. It is a drop that Trade Me Property spokesman Nigel Jeffries said he had never seen before. He also pointed to LVRS – bank lending restrictions on first-home buyers and investors – which meant fewer could get into the market and were renting longer.

Waikato Property Investor Association president and Harcourts salesman Daryl Fisher agreed that the rental market was in serious strife.

‘‘The rents have certainly been climbing for the last nine months but I would expect them to be aggressively climbing in the next 12 months,’’ Fisher said.

Investors pulled out of the rental market when the Reserve Bank implemented loan-to-value lending restrictions in October 2013. ‘‘There is not a lot of investors buying and basically there is going to be a huge shortage. The rents will just climb – there is no stopping it.’’

Community Housing Aotearoa chief executive Scott Figenshow said well-built cabins were a solid solution to the crisis. His only concern would be if they were let out at ridiculous rates.

And Prefabnz chief executive officer Pamela Bell said new thinking on the housing crisis was desperately needed.

Her non-profit industry association has more than 240 members.

‘‘When it comes to the type of housing affordability issues we’re in, we really have to consider all solutions,’’ Bell said.

‘‘Instead of thinking that the one path to a home is home ownership by a single family through a single mortgage, we’ve just got to develop other solutions.’’