MSD purchasing strategy 2016

This Purchasing Strategy contains the latest information on how, and where the Ministry expects to fund social housing tenancies through the income-related rent subsidy (IRRS). They have signalled they will be working to secure another 3,800 social housing places nationwide by 2019/20, almost half of which need to be one-bedroom places.

You can find the strategy here


Key Messages

  • MSD is helping those most in need by ensuring we have the right places in the areas where they are needed, and delivered at a cost that provides good value to taxpayers.
  • The 2016 Social Housing Purchasing Strategy sets out how and where MSD will deliver extra social housing places over the next four years and how MSD will work with providers to deliver these.
  • MSD is signalling the need for more than 6,400 additional places. This sends a strong message to the market about what is needed, and where. MSD already has about 2,600 of these places contracted or close to it.
  • Nationwide, almost half of the places needed are one-bedroom properties. Half of the total places needed are in Auckland.
  • We know that there are other regions that have seen growth in demand for social housing.
  • The Bay of Plenty is one such place and the Ministry has responded by seeking an additional 290 places in that region, over half of which need to be one-bedroom places.
  • The Wellington region is also expected to need more places, particularly for one-bedrooms.
  • Hamilton has also shown a change in demand and the Waikato region is expected to need another 205 places over the next four years. Again over half of those places needed are one-bedroom places.
  • Over the past year the Government has invested another $144 million to help community housing providers increase the supply of social housing places. We’ve acted on feedback from the sector and changed the way we fund and contract with it.
  • As a result we’ve seen more community housing providers come on board. Last year we had 26 registered providers and this year we have 41. As at the end of September they were supporting over 3,100 kiwi households.

Key facts and figures

1.MSD is looking for more than 6,400 new places over the next four years. These are over and above those already existing (over 61,400), and include 3,800 new places and over 2,600 places already contracted for or close to it.

2.Almost half of the places needed are one-bedroom

3.Almost half of the households on the register have child(ren).

4.Two thirds of people applying are aged between 25 and 54.

5.The most common ethnicities of people applying are:

  • Maori – over 40%
  • NZ European – under 25%
  • Pacific peoples – almost 15%

6.Over 40% of people on the register are looking to live in Auckland

7.The average weekly income-related rent tenants pay is $118

8.The average income-related rent subsidy MSD pays to social housing providers is $243

Discussion

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