12. Homeownership—Government Assistance

12. TODD McCLAY (National—Rotorua) to the Minister of Housing: What is the Government doing to assist people into homeownership?

Hon PHIL HEATLEY (Minister of Housing) : A range of initiatives are under way, but I will focus on just one. Cabinet has recently agreed to the extension of the loan cap on the Welcome Home Loan product from $280,000 to $350,000. This means that first-home buyers who want or have to live in higher-value areas, such as Auckland and Wellington, have a great opportunity. This product will also be available to State house tenants, who are very enthusiastic to move out of renting and into homeownership. Those tenants will be eligible to buy their homes, and they can use this product to do that.

Todd McClay: How will the extension of this product assist Māori?

Hon PHIL HEATLEY: We have also extended the loan scheme to Māori who want to build on multiple-owned land. This fulfils an election promise in which we committed ourselves to give the banks the confidence to support Māori housing. The banks are reluctant at the moment to give loans because the land cannot be used as security, and this change delivers a solution to that. Members of the previous Government wrung their hands over this problem for 9 years, and we have delivered a solution to it in 9 months.

Todd McClay: How can this product assist with the housing supply?

Hon PHIL HEATLEY: We gave that a great deal of thought, too, and changes will also allow first-home buyers to borrow in order to build a home if they already own land. On the one hand we want to increase the housing supply, and this change will also stimulate the construction sector, because if a first-home buyer owns or buys a vacant section, he or she can then borrow in order to build a home, getting the construction industry going and getting a roof over their young heads.

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