Housing group aims high
An innovative housing plan could offer a lifeline to house buyers, reports Catherine Harris.
By day Alan Henry is a chemistry teacher. By night he’s a would-be builder of affordable housing. And he has set his sights high an 18-storey block of apartments in Auckland.
Henry wants to pioneer a concept he calls ’’benevolent development’’.
The idea revolves around developing a site for a service fee rather than taking a profit.
By foregoing the profit margin, Henry estimates he can shrink the cost of development down to a tenth of its usual size, keeping the apartments ideally under $550,000.
He also has a site in mind in popular New Lynn. The New Lynn Bible Chapel is in dire need of repair and is looking to essentially do a land swap, in return for a community centre and other facilities within the complex.
With land costs taken care of, Henry’s project - named West One - then hinges on the ability to use home buyers’ deposits for building the apartments.
Normally, off-the-plan deposits are held in a lawyers trust in case the project falls over.
However, as an altruistic venture, Henry and his team are trying to persuade the Government to provide a ‘‘performance guarantee’’ so the work would be finished.
It’s a novel idea, but Henry says they have already had productive talks with Inland Revenue, Auckland Council and the Ministry of Business, Innovation and Employment about the plan.
‘‘They encouraged us to put in a more substantial report.’’
He is now talking to crowdfunder PledgeMe to find about $2 million for architect drawings, legal costs, council approvals and other costs.
The concept gained the attention of a group of professionals including architect and former Unitec lecturer, Vince May.
May said it seemed wrong to him that $25m of deposits would sit in a lawyer’s trust account earning 1 or 2 per cent interest, while a developer borrowed that same amount at 10 per cent.
Lew Meyer, an elder at New Lynn Bible Chapel, said he saw the idea as a ‘‘win-win’’ serving both the church and the community.
‘‘We’re a little church but we have the ability put up 18 storeys.’’
He hoped the Government would back the idea of a performance guarantee.
May said Henry’s views on benevolent development and his own differed slightly, but their ultimate belief was that these types of projects could help flatten out the housing market.
‘‘If we can put four houses where there’s currently one, and we do that 500 times, it starts to make a significant impact.’’
House-buyers could put their names down on a register for upcoming projects and relax.
‘‘We can’t materialise 40,000 houses inHouse hunters a month. but if we can give people the option to wait ... we facilitate that project to happen.’’
May is also an advocate of what he calls ‘‘lean construction,’’ and hopes West One will be a chance to showcase more efficient construction techniques.
Henry said there was little in the project for him except the satisfaction of helping first home buyers.
‘‘I have children who are doing well professionally, but can’t afford to buy their first home,’’ he said.
His fee, if West One takes off, would be set at the level of his teachers’ salary.
Auckland Council declined to comment as it had not received an application for consent.