Exciting Social Housing In The North

This week Joanna and I caught up with Rhys Head from Homeco to have a look at his Iwi backed social housing project for Mana Waitaha Trust in Woodend.

Prefabricated in Homeco’s factory and assembled on site, these two and three bedroom homes are HomeStar 8 rated, ready for PV solar panels and with EV charger ready car ports.

Laminated timber from Nelson and overseas producers is prefabricated in to standardised panels. Rhys explained to us that he is keen to see a production plant for the chip wood paneling they use but first we have to establish a local market which is one of the goals for this factory.

The entire home is staged in the factory meaning that stakeholders (normally clients) can walk through the building and request changes before it’s even on the site.

The completed walls, on site, have an Energy Star rating of 8. R2.6 bats combined with a range of other materials to push the external structure to a very insulated construction with very limited internal air changes means that the heat you put into the home doesn’t escape, a concern for tenants with very limited income.

The entire home can be packed into a 20 foot shipping container. The benefit of this is creating the ability to ship the buildings around the country by rail or world by ship. These panels already have all the insulation installed.

On site, the roof is built, on the foundation slab, before the walls are delivered and then craned on to the erected walls. This means that the entire structure can be closed in within a day. The benefit is faster construction meaning lower cost while also making a nicer space for everyone to work.

Let’s Look Inside On Site

Massive amounts of storage, accessible bathroom, wide doorways for wheelchair access, power points for your EV charger, tiny heat pumps (because you just don’t need a bigger one!), large kitchens complete with dishwasher, fibre ready, high stand toilets and the most magical windows you’ve ever seen!

The double glassed windows on this build will be triple on the next construction. These windows are made from recyclable plastic so they’re warm to the touch. They open in two different ways (a video of this will be on the site next week), meaning that you can open them fully in summer when you’re home or peg them ‘ajar’ with confidence that the home is secure.

Rhys has a show room in the city with all the different building technology and construction plans on display. His passion is building homes that are kinder to people and the environment. For example you may have noticed that these social homes had car ports rather than locked up garages. He explained to me that is so that a garage doesn’t get transformed into someones ‘low quality bedroom’.

Started in July 2019 and completed to this stage by December 2019, these units are fast to build and finish which delivered a much lower cost meaning that much more value can be delivered for social housing tenants. Oh, and if you’re wondering about that plastic clip board in the top of the image, it’s not a clip board, but more about that in a future post!

MORE INFORMATION REQUESTS

This morning I sent CCC two more information requests about social housing, the are as follows.

SOCIAL HOUSING NUMBERS

Further to the housing numbers published for the election, could I have an updated version?

I am specifically interested in the number of closed units.

Can you also provide a more detailed list of the 200 closed units, the reason for closure and the current intention for each.

I am wanting to update the data on our site at www.oursocialhousing.nz to keep it current and useful.

I would also like to know it it is possible to get regular change data (eg monthly) so we can keep it more current.

HEAT PUMP DELIVER SCHEDULE

Following on from this weeks obvious and well publicized confusion, can you please advise the follow.

1. An updated, month by month delivery plan.

2. Advice on when the venterlation systems will be installed.

3. Who were the successful contractors

4. When is it planned that progress will be reviewed in the first ~400 units to consider retendering.

5. Is the performance/ work load of the project management team going to be reviewed/monitored to ensure adequate resources so as not to encounter road blocks?

Could I also have a copy of the public tender documents published on GETS ~11 NOV 19 (YES I’m paying more attention to GETS emails now 😉 🙂 )

GOVERNMENT IS BORROWING SO SHOULD WE

The Government has quietly lifted the borrowing limit for the newly formed Kāinga Ora social housing agency by $4.05 billion to $7.1 billion so it can build and refit almost 4,800 more state houses on top of the 6,400 already planned. – Bernard Hickey – Newsroom

https://www.newsroom.co.nz/2020/01/20/991131/kinga-oras-borrowing-limit-lifted-by-4b#


With the growing amount of international investment in our residential housing market, it makes good sense for government to invest in housing our most vulnerable.

I’ve been contending for some time that CCC needs to borrow up large and build more social housing in serious numbers.

We haven’t built in serious numbers for 45 years. With building products having a 50 year target life, our stock is coming to end of life.

CCC’s “Project 8011” is dragging and not getting the housing numbers in the CBD that are needed, something everyone seems to agree.

Council needs to be taking a lead with at least 10 social housing projects with 20 units each, contributing at least 200 units this year.

Social housing make council good money and reduces everyone’s rates so every citizen wins!

Council needs to invest up to $1.3b in 6,500 more social housing homes.

Social housing makes council good money and doesn’t cost ratepayers.

Every citizen wins.

I believe we could borrow, build and repay within 25 years and make a $45 million dollar profit each year to off set rate.

It’s important to me that we provide our citizens with the best possible housing.

We collect GST from tourists everyday in Christchurch and social housing is a perfect vehicle for pulling that tax money back into our community in a way that makes sure every citizen gets a return.

Some will argue that this would put council in competition with the private market. It’s just not true. The private market just isn’t interested in this part of the market. The market is also expanding, so council is only ‘joining’ the market.

Some contend that social housing is a state not civic role. Two points, keeping the state in check means providing competitive pressure.

Secondly, state profits go back to the state. It’s important to remember that many social housing tenants are hard working locals, like Stephen, who earn local money and we want profits returned to our community.

Civic social housing profits all our citizens.

Weekly Update #4 – Waiting and Mailing Lists

I have now installed a forms feature on the site which now lets us start to collect information.

I can see reason for two different lists

MAILING LIST

Not everyone who’s interested in social housing wants to be checking in on Facebook or the web site, so a mailing list is important.

I’m also keen to understand as much about people interesting in social housing, as I can. So I’m going to propose a mailing list that also lets you tell us a bit about yourself, or not! 🙂

WAITING LIST

In last years, last council meeting, we heard that there are 830 people on the social housing waiting list, but who are you? What are you looking for, what is your situation and where do you want to live?

So I’m proposing we’ll collect the following, or as much as you choose to share with us.

  • Name
  • Email address
  • Phone number

All of these will be optional… actually everything will be optional.

My plan is that I’ll simply qualify the quality of interest based on the level of information provided. Clearly someone who wants to give you all their information is serious about wanting something.

  • Required Bedrooms
  • Required Beds – we don’t assume that people need or want a bedroom each, but we want to know how many people you want to have living in a space.
  • Current suburb – we don’t know where you actually live, we’d just like to know where your community is.
  • Desired suburb – we assume that people have been moved around as a result of the earthquakes so we’d like to know where you’d like to live
  • Schooling – do you need to be close to a school?
  • Public Transport – do you need to be close to it?
  • Work Suburb – we want to understand where you need to travel to.
  • Drug use – this one’s quite important. Right now CCC have units that people have used drugs in, they simply need cleaning. The government standards have changed and for some people, they’d sooner have a more affordable home than where they are, so there is a case to argue that these units should be made available.
  • About you – age range, gender, health – if you’re 85 and in poor health then you need higher quality housing than I do. Double rather than single glassing and better heating, for example.
  • Current housing – we’re keen to understand people who are couch surfing, those who are simply unhappy with private accommodation or other reasons
  • Reason for your interest – as above, we’d like to know why you want social housing. We understand that in some causes what people really want is help to improve their situation but just don’t know where to reach. In this journey so far, Stephen and I have learnt a lot about services we didn’t know existed.

I’ll be posting this on Facebook, so I’m keen to hear your comments before we set this alight! 🙂

Weekly Update #3 – Incoming Information and Support

ONE MORE FOR SALVATION ARMY

This week I got another private landlord to provide another unit to the Salvation Army’s offender reintegration program.

Providing good housing for reintergration is critical. Offenders who don’t have good housing can re-offend quickly and this is a path directly back to prison.

Offending creates more victims as well as causing an expensive revolving door in our courts.

DOUBLE GLASSING QUOTES

I meet with Cr Phil Maugers last week to talk about social housing moving forward.

Phil did some work on better the cost of improving a number of social houses during the election campaign.

I now have a copy of those quotes from Hagley Window Replacements. They’re not cheap at around 10% of the average cost of units.

I can see value in asking the question for living rooms on the ground floor, south sides of complexes where the winter sun will not get and cause those homes to need heating.

People want to help improve social housing in the city, this was clear from my conversations with both Phil and Collin, from Hagley.

LAND QUOTES & OTHER SOCIAL HOUSING PROVIDERS

Also of interest this week was a discussion with a large land holder in Burwood with land adjacent to Concord Place.

As I’ve traveled my recent journey into social housing, it’s become obvious to me that there is profit in this area with an ample supply of profitable tenants. I’ve been looking around the city at locations and the question of the need for a competitor to OCHT.

It seems to me that the model is now well understood and the demand for housing very much exists.

QUALITY DATA AT COUNCIL

https://christchurch.infocouncil.biz/Open/2019/11/SACRC_20191128_AGN_4065_AT.htm#PDF2_ReportName_25446

This weeks CCC Sustainability and Community Resilience Committee agenda includes a big section on social housing.

I reached out to the chair to make a short deputation on Thursday because I had a number of questions about the quality of data and information being presented to elected members and I also want to reaffirm with the council that our interest in social housing was more than just as an election stunt.

The result of this exchange has been a very productive exchange with the CCC housing manager who has invited Stephen and I to meet to talk further about housing at some point and has also provided an extensive backgrounder to improve our understanding.

QUALITY DATA AT HOUSING NEW ZEALAND

Some very useful and interesting data showed up from HNZ this week. They presented their data by census area and broke it down by ‘bedroom count’.

Big thanks to Stephen who spent some time checking the data, putting it into a spreadsheet and added ward data so I could import it into the database to let us compare and consolidate with the council data.

In presenting this data for your consideration, these are the things that occurred to me.

  • The social housing portfolio is large and getting a good view of it isn’t easy.
  • For good governance elected members should constrain to looking at stock in their own ward as a starting point
  • Members need to consider the condition and quantity in their ward and the need.
  • CCC data doesn’t present number of bedrooms, so it’s hard to compare with HNZ data.
  • A useful measure of service is bedrooms, not just dwellings
  • We don’t know where the ‘Other social housing providers’ units are

Notes:

  • The HNZ data columns are showing 0,1,2,3,4,5+ rooms per dwelling
  • Papanui includes 18 ‘zero’ bedroom dwellings in the HNZ data, we never asked why.

OUR SOCIAL HOUSING, NOT JUST CCC HOUSING

As you can see, we are starting to get a more full picture of the state of social housing in our city.

Our aim to to better understand the bottom rung of housing in our city to best inform ourselves and others around housing policy and rise up the state of social housing.

Weekly Updates #2 – Presenting Information And Ideas

This week Stephen spent many hours improving and building up the presentation of the September housing data. He added a “Community Boards” summary page which shows a very high level look at the amount of housing in each area and how many are currently closed.

I spent some time with a number of elected officials, presented our work on the web site and reaffirmed our interest to see social housing get serious attention in this term. I felt like there is a agreement that we have to get closed units open. They serve no one closed.

A ‘social housing working group’, chaired by the mayor is being established this term, in addition to the normal collection of committees. I’m assured that this will have teeth given that it is being chaired directly by Lianne and not just get lost in the mix as happened in the past. Personally, at present, I think this is fantastic news for social housing. If this term becomes Lianne’s last then what happens in social housing will become a legacy, if she runs for another term then she is chief in charge of social housing, a portfolio that hung the last chair.

WHAT’S NEXT?

I’m presenting a number of themes.

  1. Why we need CCC in social housing – this doesn’t seem well understood. I published a paper on this a few months ago.
  2. We don’t have as much open stock as people think. People need to get informed and be talking about the real numbers which are closer to 1,900 not 2,200.
  3. Fix it first – Fixing closed units has to be the priority. Repairs don’t require consents or architects, they simply need builders and project managers. Trades are calling out for work. This also includes the heating which there is still no program of work completed for.
  4. We need to ‘trade’. We have to stop talking about ‘asset sales’. Right now our social housing stock is not much of an ‘asset’, it should be. We need to ‘trade it’ back to good health. In some cases that will mean selling off bits, buying bits, fixing bits and building lots!
  5. We need to borrow. Our current asset value is around $325m, we should be borrowing that up to $1.5b to match an 80% equity and how the private market manages residential property.
  6. It’s time to build – Money is cheap, we did most of our building in the 1970’s. There are currently 130 units on the horizon. That’s a fraction of what is going to be needed to keep up with population growth, age and the age of our current stock, 342 units were demolished.

In the past week council have had their swearing in and first meetings. At present dates for the committee that housing falls under have not been set. My plan is to make a public forum presentation at the first meeting asking for focus on the issues above. I’m also interested to know what support there is for a petition to call for attention to such.

D

Weekly Update #1 – Requests for Information

Every week I’m going to try to write some words about what we’ve been up to, so here goes for week one!

INFORMATION REQUESTS

Stephen has been smashing out the data input of all the information we’ve discovered so far about OCHT. A couple of weeks ago I reached out and asked for more information from the trust to fill in a few of the gaps from the information that CCC had on their web site. I have to say I found the trust to be very open and they provided the information very quickly.

WE ALL NEED THE WHOLE PICTURE

This week I connected with the Housing NZ team and they’ve agreed to provide information about their stock in Christchurch so we can gather a more detailed picture about what exists. They’re going to provide data by suburb (which we will process into wards) so that we can provide everyone with a more detailed picture by area.

WHAT ABOUT HEATING AND COOLING?!

I have also not forgotten an earlier interest in the climate data that HNZ has been collecting. At last weeks housing forum I spoke with the CDHB folk who are also looking at the same questions.

I have also lodged a formal request with CCC for more information about the delivery of the heating and ventilation program that was committed to in September.

WILLIAMS CORPORATION INFORMATION

Today I also made time to pop into Williams Corporations new Christchurch office, caught up with one of their MD’s and GM and meet their capital fund guy Chris Conner.

I dropped in because I wanted to grab some light reading.

You might be wondering what this has to do with OUR SOCIAL HOUSING when those properties start from over $350,000.00! Simple… housing is a ‘ladder’ and if people want to get out of social housing and into a private market flat that they can afford then we have to push everyone else on the ladder up a rung. We also have to get more housing built, and we do care what that housing is. Right now, these guys are busy building stuff that the market is just screaming out for, so I’m doing everything I can to know as much as I can about it.

No, I’m not selling them, no, I’m not in the market for one right now… but YES, I know people who are, I know people who have money to spend, I know people who would benefit from knowing, and so do you!

It was fantastic to get to meet with Chris this afternoon because he’s a guy who just knows all about raising capital to help Williams Corporation build more homes in Christchurch. One day I’d like to build a heap of social housing too, that needs money and it’s people like Chris who teach people how to raise capital so the more time people like Chris will give you, the better for everyone!

How Much Can I Borrow?

When you’re thinking about buying a home the question at the top of your mind is how much can you borrow and then how much should you borrow.

When you’re thinking about buying an investment property the only thing you’re thinking about is how much you can borrow.

The difference is because when you’re renting something out you’re earning money on the money you’ve borrowed, when you’re buying for yourself you’re just paying for what you’re living in so you want to consider the balance between lifestyle and paying down debt and growing equity.

This year I’ve spent a bit of time hanging out with the Williams Corporation team at their investment buyer evenings (I think I’ve been to three now!). One thing they point out is the value of borrowing as much money as you can because you can earn money on the banks money.

LVR rules mean you need at least 20% deposit for a new build unless you’re a first time home buyer and leveraging your Kiwisaver…. the council isn’t buying it’s first home.

The current rateable value of our social housing stock is over $325 million dollars so I’m keen to get busy and borrow some… how about $1.3 billion dollars?

On Sunday I had an interesting conversation with Anne Galloway, the city councilor for Halswell. Like many, she goes to pains to point out that we can’t fund social housing from rates. Frankly I’m at a bit of a loss why people keep prattling this comment and am feeling a bit white washed. I can’t help feeling that this whole social housing thing is a bit like an episode of “Yes Minister” and we’re all being played.

Not only should social housing not be funded from rates but it should also bring our city a large return.

I did some quick math…

I wondered how many units we could build if we borrowed everything we could and just asked Williams Corp to build for us (at their published book value). Of course we wouldn’t ask then to build at book value and we already have the free land, so we can’t factor that. So I pondered how many we could build if I took the current average unit value, but of course that number is no good either because it looks very much like most of our stock is over valued in the market given what we should be able to build for currently (though don’t tell the bank that because I want to use my existing stock to secure the loans!)

I decided that I should just factor the Williams Corp price, the current rent, cost of borrowings at councils 2.5% and as much money as I could borrow and figured out that we should earn $19.5m a year. That fixes the problem of finding funds to run the stadium!

Ok, so these are just scatter gun numbers because it leaves out so much information and makes to many assumptions, but it does make me wonder why we’re messing about and not getting busy with a massive building program to at least get us another 1,000 homes build withing the next 18 months!

https://www.ccc.govt.nz/assets/Documents/The-Council/Request-information/2017/LGOIMA-State-Housing.pdf

In the mean time my wife flicked me a pdf link that she’d found while looking for something else, which is just full of enlightening reading. At first I was wondering what the heck it was all about but then it occurred that this isn’t just economic, it’s political too!

The council has been moving housing into a trust because it wants to be able to claim government assistance for tenants while giving the tenants lower rents. But council also has the ability to raise massive amounts of capital and the tax payer is paying the bill.

I haven’t read all the detail, but clearly lawyers at The Treasury are interested.

The other numbers I also considered is how quickly the council can pay off its borrowings. Our council is already very wealthy, Raf Manji expressed recently that CCC is worth $13b dollars.

I’m sure it’s an issue for some that growing our housing stock means growing the wealth of our council and currently we have an increasingly wealthy and powerful council.

I can’t help wondering how much of this is all about improving the quality of housing in our city and country v’s more scrapping about who’s budget stuff goes on… hummm…. those who know me know just how bothered I get about that issue!

D

How Are Elected Officials Informed?

OCHT Provided More Numbers! 🙂

This afternoon I got an email back from Bob Hardie, Senior Housing Advisor, Ōtautahi Community Housing Trust and then followed up with a quick phone call.

Stephen McPaike picked up that this list has units listed that were not in the spreadsheet that came from CCC last week (that was part of an information request by a candidate during the election process).

The question all this presents is, who actually knows how much social housing Christchurch has and how do elected members become informed?

Bob commented that they don’t report back to CCC, which is quite reasonable, and it occurred to me if OCHT are this willing to provide me with information then clearly they would do the same for CCC if they asked, it’s not like a count of housing is a secret!

I like Bob, he was easy to chat to and very informative.

I also asked about closed units and how long they stay closed. Bob explained that they aim for between 11 and 15 days, which I expressed is very reasonable. When I’ve turned over rentals in the past it can take a few weeks to clean things up and get them to a level you want to present.

Bob also explained that the trust has been trying to raise the level of quality in the unit stock as they turn them over, also seems very reasonable…. actually there wasn’t anything in our brief 10 minute conversation that I didn’t find reasonable.

We also talked about how the open and closed units are quite fluid as tenants change and that drug use in the units is one of the biggest challenges. That last one I can personally relate with having done a couple of meth decontamination’s.

So, while a very helpful conversation, I’m now left with more questions than I started with and pondering how elected officials can be expected to make planning choices when no one seems to have the full picture.

However, on balance, I also think we shouldn’t get alarmed about this as we have some reasonable rough idea and everyone seems to agree that we need more social housing. The only thing we don’t seem to agree on right now is if we’re moving fast enough and how we might move faster.

All Cleaned Up – Harman Courts Front Yard

Well the good news is that the front yard clean up at Harman Courts got finished today! Yeah!

Let’s hope there aren’t to many more of these sorts of issues hiding in the wood work because they’re really expensive! They’re expensive because once they start, the rubbish just keeps pilling in as was seen at Harman Courts.

Thanks to everyone involved in following it up.

The biggest learning for CCC and OCHT from this should be that when you say you’re going to do something, give yourself enough time! If you’d said it will take 3 weeks then sure, we would have questioned why we can’t get resources sorted sooner, but saying 24 hours was likely a bit unrealistic too. 🙂

I think the biggest thought for tenants has to be that if you see someone moving out and can see they’re over whelmed with rubbish then reach out for help! The dump just isn’t that expensive, plenty of places have a free/borrow trailer and we can put the hat around for dumping fees if your stuck, we can also put the hat around for petrol money.