Why does a housing shortfall matter?

A shortage of housing stock can have a number of negative consequences, some of them relatively devastating. People may experience stress, ill health, broken relationships when they struggle to find suitable, affordable and stable accommodation.  A shortfall of housing can result in:

Compromised choices. With a shortage of housing, some people are forced to live in places that do not adequately meet their needs. Where individuals lack sufficient income or other entitlements to gain housing, one of the few options they have is to share accommodation with others. These larger households are formed more or less involuntarily, and can mask the housing shortage as the demand remains unmet and invisible. Some of the most devastating effects of a lack of housing have been shared recently by Waikato Women’s Refuge. Twenty eight women (approximately 40% of total) accessing the Women’s refuge safe house over the past 6 months, have had no option but to return to the violent living conditions that they fled. There are a limited number of affordable housing options available and it can take as long as 9 months to find suitable accommodation. Temporary options are too long for many women who need to settle children.

Substandard housing. In a tight housing market, landlords can get away with offering substandard housing. People are forced to accept substandard housing conditions because there are no alternatives on offer. There are numerous stories of people living in substandard, poor quality rental accommodation in Hamilton. The poor quality of our rental housing stock and the associated negative health effects, have been well documented[1].

Increased house prices. A limited amount of housing can result in greater levels of competition between prospective buyers, with house prices rising. People with moderate or low incomes are finding it increasingly difficult to purchase a house and as a result are renting properties rather than buying them. The rates of home ownership in New Zealand have been reducing since the 1990’s and are continuing to drop. Home ownership has declined from 73.5% in 1991 to 64.5% in 2013. There is now widespread agreement that there is a shortage of new affordable homes for sale to modest income households.

Rent increases. Rents tend to rise when there is a limited pool of rental properties and high demand. Hamilton is experiencing this situation right now. Average rents in Hamilton City increased by $42/week (13%) between March 2015 and Mar 2017. By comparison, the statutory adult minimum wage increased $1 per hour or 7% over the same time. The increases in the accommodation supplement announced in the last budget, while long overdue[2], will bring some welcome relief for many households.

Homelessness. Without access to suitable accommodation, people are forced to move in with family or friends, sleep in cars or even on the street. According to University of Otago researchers, at least one in every 100 New Zealanders were homeless at the latest census in 2013, compared with 1 in 120 in 2006, and 1 in 130 in 2001. These numbers are based on the official New Zealand definition of homelessness which includes people living in severely crowded houses, in motels, boarding houses, on the street or in cars.

“If the homeless population were a hundred people, 70 are staying with extended family or friends in severely crowded houses, 20 are in a motel, boarding house or camping ground, and 10 are living on the street, in cars, or in other improvised dwellings. They all urgently need affordable housing.”[3]

At a recent talk in Hamilton, Peter Humphreys, the Manager of Hamilton’s Christian Nightshelter, relayed some very concerning aspects of being homeless. “Being homeless, you are 34 times more likely to commit suicide, and you are 150 times more likely to be physically assaulted.” Peter attributes homelessness in Hamilton partly to the loss of a range of accommodation options in Hamilton. Accessible boarding rooms disappeared from Hamilton in the mid to late 1990’s. There are currently 219 people on the MSD housing waiting list in Hamilton and 145 of these people require 1 – 2 bedroom units, which are in short supply.

[1] Howden-Chapman, P. (2015). Home truths: Confronting New Zealand’s housing crisis. Wellington: BWB.
[2] Johnson, A. Give Me Shelter. An Assessment of New Zealand’s Housing Assistance Policies. The Salvation Army Social Policy and Parliamentary Unit.
[3] Dr Kate Amore – http://www.otago.ac.nz/news/news/otago613529.html

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