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Doing The Social Housing Thing

It’s not for everyone, but leasing private rental properties for social housing is a viable option for investors – and it highlights the fact that there’s plenty of different strategies for investors to explore.

By: Miriam Bell

29 February 2020

It’s impossible to deny that New Zealand remains in the grip of a housing crisis. There’s no escaping the visible rise in the number of homeless people sleeping rough. And there’s no way to avoid the tales of people desperately searching for safe and adequate accommodation.

The problem is not just a general shortage of housing stock, it’s that there’s a severe shortage of affordable housing.

As a result, the demand for social housing has skyrocketed. But neither the Government nor community housing providers (CHPs) have enough properties to meet the demand.

That situation makes for opportunities for investors who are interested in putting their rental properties into the social housing stock. We’d been planning an article about this for months as we thought it an interesting option to look at.

Then, with uncanny timing, just before the magazine went to print the Government announced its homelessness action plan. One of the new initiatives in it is an MSD-run housing broker service which will reach out to private landlords to get them on board.

However, the social media response indicated that many landlords felt the Government was being hypocritical. They felt that after the introduction of so many policies which make the provision of rental property much more difficult, it is out of line for the Government to then expect them to hand over their properties.

This is understandable – particularly given the spectre of the looming tenancy law reforms which have just entered the Parliamentary process. It reinforces the pressures, and increased risks, that come with being a landlord in the current climate.

It also highlights that there are different strokes, or strategies, for different folks. For some, partnering up with a government agency or CHP to provide housing to those in need is a good investment option. For others, it is not and it doesn’t have to be.

But it’s an option that warrants exploring in this day and age. And we do just that in this month’s lead article, which features the experiences of a range of investors who have themselves gone down the social housing path and are very happy that they did.

We hope it provides some food for thought for those who are interested. In this issue, we also feature the final column from the NZ Property Investors’ Federation’s long-serving executive officer, Andrew King. After many years of diligent and, at times, challenging service, Andrew is moving on in order to take on new experiences and travel more. We’d like to thank him for his patience, good humour and hard work – and wish him all the best for the future.

Along with our social housing feature and Andrew’s farewell column, this month’s magazine is packed with useful information and great stories. Please read, absorb and enjoy.

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