Ki­wiBuild: Lotto odds lower

Hous­ing Min­is­ter crunches num­bers for Govt scheme af­ter crit­i­cism

Herald on Sunday - - WE SALUTE YOU - Ben Leahy

The odds of claim­ing a Ki­wiBuild home are far bet­ter than walk­ing away with a win­ning Lotto ticket, Hous­ing Min­is­ter Phil Twyford says.

Twyford made the com­ment af­ter a week of at­tacks on the home build­ing scheme, in­clud­ing claims it was a form of Gov­ern­ment-spon­sored Lotto that would bring wealth to a se­lect group of first-home buy­ers.

But Twyford said 1 in 5 of those who ap­plied for the first 18 Ki­wiBuild homes re­leased in Pa­pakura in South Auck­land last month were suc­cess­ful.

About 1 in 20 ap­pli­cants were then suc­cess­ful in the re­lease of 25 Ki­wiBuild apart­ments in One­hunga.

The odds of win­ning Lotto’s First Divi­sion are 1 in 3.8 mil­lion. For Power­ball it is 1 in 38 mil­lion.

“Win­ning a Ki­wiBuild bal­lot may feel like win­ning Lotto, but the chances are so much higher,” Twyford said. “Peo­ple who en­ter a bal­lot for a Ki­wiBuild have a good chance of be­ing suc­cess­ful.”

Crit­i­cism of Ki­wiBuild and its plans to build 100,000 af­ford­able houses for first-home buy­ers has in­cluded the ques­tion of just who would end up with the prop­er­ties.

The first batch of three-bed­room Ki­wiBuild homes in Pa­pakura sold for $649,0000 each last month. Data from prop­erty an­a­lysts CoreLogic es­ti­mated th­ese prices were up to $100,000 cheaper than sim­i­lar homes in the area, mean­ing buy­ers ap­peared to be set for a bar­gain.

To be el­i­gi­ble to pur­chase a Ki­wiBuild prop­erty, first-home buy­ers had to meet pre-qual­i­fi­ca­tion con­di­tions. Th­ese in­cluded hav­ing an in­come less than $120,000 for one per­son and $180,000 for joint ap­pli­cants, an in­ten­tion to live in the home for at least three years and preap­proval for a bank loan. Those suc­cess­fully meet­ing th­ese con­di­tions then went into a bal­lot where buy­ers’ names were drawn at ran­dom.

Eighty-eight en­tries made the bal­lot for the 18 Pa­pakura homes and 427 “pre-qual­i­fied” en­tries went into the bal­lot for the One­hunga apart­ments.

But when grad­u­ate doc­tor Der­ryn Jayne and part­ner Fletcher Ross, a mar­keter, were named as suc­cess­ful buy­ers in Pa­pakura, crit­ics ques­tioned whether they were too wealthy to be helped into a dis­counted home.

Na­tional’s hous­ing spokes­woman Ju­dith Collins took aim at the el­i­gi­bil­ity cri­te­ria, say­ing it wasn’t tar­get­ing New Zealan­ders who needed it the most.

“With bil­lions of tax­payer dol­lars in­volved and sig­nif­i­cant per­sonal ben­e­fit to lot­tery win­ners at the ex­pense of tax­pay­ers, there should be strin­gent el­i­gi­bil­ity cri­te­ria,” she said last month.

ACT leader David Sey­mour crit­i­cised the fact those who buy a Ki­wiBuild home are now able to sell it off af­ter three years and keep 70 per cent of any gain.

Prior to be­com­ing Gov­ern­ment, Labour stated that Ki­wiBuild own­ers who sold within five years would have to pay all prop­erty gains to the Gov­ern­ment.

Twyford said the re­cent Pa­pakura and One­hunga bal­lots showed the scheme was not a lot­tery and that ap­pli­cants had a good chance of get­ting a home.

Although not ev­ery­one would be able to af­ford a Ki­wiBuild home, Twyford said the pro­gramme was aimed at help­ing those “who have tra­di­tion­ally ex­pected to be able to buy their first home, but have been locked out of the mar­ket”.

“A cou­ple each on a salary of $50,000 can af­ford a Ki­wiBuild home in Auck­land even at the top price cap of $650,000 for a three-bed­room home. The price of af­ford­able Ki­wiBuild homes across the coun­try will of­ten be much lower than that.”

For buy­ers not able to af­ford the cost of an up to $600,000 mort­gage for a Ki­wiBuild home, the Gov­ern­ment has also flagged it is work­ing on a new shared-own­er­ship pro­gramme.

This is likely to in­volve the Gov­ern­ment or banks buy­ing homes in part­ner­ship with lower in­come Ki­wis by pay­ing a share of the up­front cost of the houses. At a later date, the buyer could pur­chase the home out­right.

Win­ning a Ki­wiBuild bal­lot may feel like win­ning Lotto . . . Hous­ing Min­is­ter Phil Twyford

Photo / Greg Bowker

New Ki­wiBuild home own­ers Der­ryn Jayne and Fletcher Ross, with Phil Twyford and Prime Min­is­ter Jacinda Ardern.

Newspapers in English

Newspapers from New Zealand

© PressReader. All rights reserved.