The Government has promised to build thousands of new state houses at the same time as it sells off up to 8000 existing houses over the next three years.
Social Housing Minister Paula Bennett says the Government will use the proceeds of state house sales partly to double Housing NZ's new building rate to more than 1000 a year.
That increase, plus evicting many of the 3300 state tenants already paying market rents, appears to account for most of a planned increase of 3000 tenants receiving income-related housing subsidies by 2017-18.
New details, announced in Prime Minister John Key's state of the nation speech to the Auckland Rotary Club yesterday, put some limits on a policy that originally aimed to lift the community sector's share of social housing from about 5 per cent to 20 per cent.
Mr Key said sales would be limited to 1000 to 2000 in the next year and to an effective maximum of 8000 - 12.8 per cent of the state housing stock - by 2017. By then Housing NZ would still have at least 60,000 properties.
He promised to put some of the sales proceeds into an extra $40 million a year in income-related housing subsidies by 2017-18, lifting the numbers on the subsidies from 62,000 to 65,000.
The rest of the proceeds would be used "for housing and other capital projects needed across government".
Ms Bennett said there would be "a doubling of the amount of new housing by Housing NZ".
"They actually did about 490 houses last year. They are on track to do 1039 in the next 12 months, but I think they can do better than that," she said.
She said houses would be sold by competitive tender, with separate contracts for social services to keep sales contracts "clean". However, the Government might accept less than the highest-priced bid to get better support for tenants.
Mr Key said sale prices would be below open market values because buyers would have to keep properties in social housing.
Housing NZ is to accelerate reviews of its existing tenants from about 2000 announced previously to 5000 over the next two years. Reviews will target the 3300 tenants already paying market rents and others on near-market rates, requiring many of them to move into private rentals or home ownership.
Fletcher Housing director Alan Jackson said private developers would be interested in forming consortiums with community agencies. Labour housing spokesman Phil Twyford said ministers were trying to hose down public alarm about a large-scale sell-off of state housing.
"It is clear that they are moving to a different model of social housing where anybody can own the houses and the Government just pays a subsidy," he said.
"The legislation and their public statements have explicitly left the door open to for-profit providers."
* To watch Key's speech, visit: tinyurl.com/nzuzh7l
