Shared equity home ownership plan

WELLINGTON: New Zealanders trapped in the rental market and unable to afford a KiwiBuild house will get government help to buy their own home.

Housing Minister Phil Twyford confirmed this week he was working on a plan for the Government or private investors to start buying homes in partnership with lowerincome New Zealanders.

It is likely the Government or banks will pay a share of the upfront cost of each house and the buyer will pay the rest.

By having the Government take a stake in their home, the buyer would then have a smaller home loan and reduced mortgage payments.

They could buy the home outright at a later date.

It targets the socalled ‘‘missing middle’’ — police, nurses and teachers — who do not qualify for social housing but cannot afford KiwiBuild homes.

Mr Twyford said the scheme could tie in with the Government’s plans to build 100,000 KiwiBuild houses for firsthome buyers, which — given prices in Queenstown and Auckland of up to $650,000 — were unaffordable for many.

‘‘With KiwiBuild, there is a whole lot of people that would love to have a crack at home ownership but . . . don’t have any ability to take on a half a milliondollar mortgage,’’ he said.

However, ‘‘a much bigger group of people can benefit from KiwiBuild’’, if the homes were offered under a sharedownership model.

It is likely to be 18 months before it is introduced and two to three years for it to be offered on a larger scale.

The Government hopes to build the development at effectively no cost to its balance sheet by selling KiwiBuild homes at cost prices and using income from the houses sold on the open market to cover the cost of building new state homes. — NZME