What are our values?

We want to see New Zealand families have a realistic pathway into home ownership.

Currently, people who have not already got their foot on the property ladder are facing ever increasing barriers to achieving a home ownership goal.  We, therefore, need to open new avenues for people to gain access to a home.

The rent-to-own policy opens this new avenue.  We would see houses that are already committed to be built by the Government offered as rental properties where part of the rent goes to pay the cost of a deposit on the house.

This is the first step in opening up new options for home ownership and could be expanded into other centres where the Government or Local Governments have building interests and can be used as a template for companies who could see this as an effective way to secure a steady revenue source

What will we do?
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Reallocate a portion of the Government building programme

The Government recently announced that they were building 34,000 new houses in Auckland.  Of these, 20,600 are going to be built to be sold on the market with a target of making them affordable.  Our plan would see us take half of these and offer them as rental properties instead of properties for sale.  This allows us to operate the scheme with no new spending.

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Target first home buyers and young families

We would want to see these rental properties offered at market rents to people who do not currently own a property. This allows people access to a property without needing to pay the high cost of a home deposit.  For example, if we assume a home being built by the Government was going to cost even as much as $600,000, a home deposit would be $120,000.  This is a huge sum of money for many families and first home buyers who will struggle to compete in this market,  Therefore, this plan seeks to allow them to accumulate that cost via their rent payments.

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Allow rent payments to purchase shares in a home

A portion of that rent is paid to the Government as rent that will cover the costs of fixed costs (such as rates) and deliver some income to the Government.

The rest of the rent will then count towards purchasing a share of ownership in the house in question. This means that the payments act as if they were mortgage payments and give tenants a pathway towards owning an increasingly large share of a property.

 

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Securing a new pathway to home ownership

This policy can help to deliver a home for more than 10,000 New Zealand families.  At the point in time that a tenant owns enough of the property to count as a deposit, they will be offered the property and their ownership can count as the home deposit. They will then need to find financing for the property (with a mortgage for example).

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