To solve our housing crisis, we should look to Vienna
At the tail end of New Zealand’s postwar state house-building boom, a strange edict was handed down to the government agency overseeing construction: don’t design anything with french doors.
The reason for this odd instruction? State houses had raised quality standards to such an extent that private builders were simply copying the designs and adding a few flourishes – french doors included – to distinguish their product. In order to keep commerce happy, state housing must not – the government decided – enter that territory.
This story, related in Ben Schrader’s excellent book We Call It Home, is relevant again this week, following our current Government’s announcement of a tougher line on emergency accommodation.
The move to roll back emergency housing is a good one, given the scheme’s $340m-a-year spending on frequently awful motel rooms. And the Government can take this line because Labour, after initially letting the sector boom, cut motel tenant numbers from 5000 in 2021 to under 3000 late last year. It did this partly by building or acquiring more than 13,000 state houses.
The direction of travel, then, is positive. But National’s crackdown poses problems. People who have “unreasonably contributed” to their own housing situation, presumably by getting kicked out of other places, will be barred from emergency accommodation.
Yet people in dire straits often lead chaotic lives, battling multiple dysfunctions, and almost inevitably make mistakes: is it really to the nation’s benefit to bar them from motel rooms if, as seems likely, they then just wind up on the streets?
A Wellingtonian I interviewed last year, Iosua Clarke, told me he was in emergency housing because “it’s hard finding accommodation, especially for [ex] inmates and fullas in the struggle. No-one will really take us.” It’s noteworthy, meanwhile, that Social Development Minister Louise Upston refuses to promise that the crackdown won’t worsen the crisis of homelessness. People, after all, need somewhere to go. In many cases, that is unlikely to be a private flat. Quite apart from the discrimination Clarke describes, the private sector is simply unaffordable for many.
Hence why New Zealand, like most developed countries, has long provided state housing, the rents for which are currently set at one-quarter of a tenant’s income. There is widespread acknowledgement that we have too little social housing, a term that includes state homes but also NGO-provided accommodation that attracts similar subsidies. In 1990, social homes made up 5.4% of all houses, an already low number by developed-country standards. By last year that figure had plunged to 3.3%.
The main culprits in that decline were the National governments led by Jim Bolger and John Key. Subsequent Labour administrations made a start on undoing the damage. But we still need, in 2024, to build a staggering 43,000 social houses overnight just to get back to that 5.4% figure – that is, the level of social housing provided in 1990.
In opposition, the new housing minister, Chris Bishop, promised to “build enough state and social housing” to clear the state-house waiting list, which then sat at 25,000 families. That’s a pledge to which he must be held.
But we can also have higher ambitions. The current debate on social housing assumes that, even if boosted, it will remain marginal, a second-best alternative to private provision. This is not, however, based on evidence that the private market works better as a rule. Rather, it is pure ideology, as a glance overseas demonstrates. In the Netherlands, nearly one-third of housing is provided outside the market, often built by the state then handed over to charities to run.
In Vienna, fully half of all residents live in state-owned or state-subsidised co-operative housing. Rents are low by global standards. And the apartment blocks aren’t brutal monoliths: as a quick online search reveals, buildings like the Sandleitenhof or Reumanhof are stylish constructions, often indistinguishable from private developments and sporting huge arched entrances, soaring architecture and quiet gardens.
If modern New Zealand state housing doesn’t look like that, it’s only because we’ve lost so much public competence and building knowledge since the first Labour government’s big construction push – and, more recently, the abolition of the Ministry of Works. As Schrader once told me, Labour’s original vision was that state housing, rather than being a residual service, should have “a social status equivalent to home ownership”.
For a while that vision came true. “When I interviewed [the first generation of] state house tenants, they said it was great to have a state house and they had sort of ‘made it’,” Schrader said. “It was a step up in the social hierarchy.”
Though this vision runs counter to current New Zealand thinking, in which the state just provides base-quality, cookie-cutter services, it would be familiar to the Scandinavians, who like to say that for the public, nothing but the best is good enough. When it comes to housing, that principle should be our guiding light.
Max Rashbrooke is a senior research fellow in the school of government at Victoria University of Wellington-Te Herenga Waka. He is a regular opinion contributor.