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Invercargill is one of the first areas where state houses will be off-loaded to community providers, the Government has announced.
Habitat for Humanity Invercargill welcomed yesterday's announcement, stating ''private enterprise'' will do a better job than the Government.
Housing New Zealand Minister Bill English and Social Housing Minister Paula Bennett yesterday said Tauranga and Invercargill had been selected because of their stable demand for social housing, and registered community housing providers keen to take part.
There are 370 state houses in Invercargill and 1250 in Tauranga.
The two cities are part of the first stage of the project to divest a substantial chunk of the Government's state housing portfolio.
In the first stage, the Government will off-load up to 2000 houses.
Just how many, how much they will cost, and what conditions are to be imposed, have not been disclosed.
Habitat for Humanity Invercargill, a registered community housing provider, was enthusiastic but needed more detail, chairman Stephen Falconer told the Otago Daily Times.
''It's all up in the air at the moment.''
The organisation owned 16 houses in Invercargill, and was making internal changes to allow it to handle a larger portfolio.
''We put more of an emphasis on people, so I think we may be able to do a better job there.''
Asked about community scepticism about the mass transfer of state houses, Mr Falconer said it depended on attitude.
''If they think it's Government's job to provide housing than obviously they'll be sceptical or opposed to this.
''We're a private organisation, essentially, and we think that private enterprise can actually do a better job than Government on most things.''
It was hoped former state houses could be put into Habitat's existing rent-to-buy scheme, but it depended on individual tenant's needs, and conditions imposed by the Government.
''We're keen for people to be independent if they can be.''
Dunedin South Labour MP Clare Curran said the sell-off would do nothing to fix the housing crisis or help vulnerable families.
''This policy is driven by Bill English's mad quest to get state houses off the Government's books.
''Changing the ownership of these homes won't provide any extra houses or improve the quality of cold, damp rental properties which are making our kids sick.
''The Government is offloading these homes to anyone that will take them after our most respectful social agency Salvation Army declared the policy would not improve the lives of tenants and walked away,'' Ms Curran said.
In a press release, Mr English and Ms Bennett said the next step in the process was consulting iwi and hapu.
''Existing tenants will continue to be housed for the duration of their need and their rights will not be affected if their landlord changes,'' Mr English said.
The shift would not affect rent levels or eligibility for housing. Properties transferred under the scheme could not be sold unless the Government agreed.
Invercargill has two registered community housing providers, Habitat and Accessible Properties, and five as-yet unregistered community housing providers.