Housing lending policy eased

Press, 16 May 1984, Page 1

Housing lending policy eased

By PATRICIA HERBERT, property reporter

Policies to bolster the supply of State rental units and to help low-income families buy their own homes were announced by the Minister of Housing, Mr Friedlander, yesterday.

Two of three restrictions imposed on Housing Corporation lending in November, 1983, will be removed at the end of June. It will be able again to lend on existing properties and to childless couples but the embargo on single applicants will remain in place. The clamps were put on when the corporation ran over budget and Mr Friedlander introduced them as temporary measures. In 1984-85, the corporation is authorised to lend 10,000 home loans. It lent almost this number last year, considerably exceeding its budgeted target of 8600. However, Mr Friedlander said that, although the total level of lending would re-

main about the same, pressure on funds had been eased by the entry of the Post Office Savings Bank into the first-mortgage market. “With the Post Office continuing to provide for a substantial number of home ownership account holders,” he’ said, “there could be 1000 extra loans directed into helping those with most need.” Other details of the 19841985 lending programme released yesterday were:

• The continuation of the building suspensory loan scheme whereby people using private sector finance to build a first home can apply for a special Government loan of up to $5OOO.

0 An allocation of £24 million for housing improvement loans. • Finance for a further 450 pensioner rental and owner-occupied units. This will be complemented by measures to ease demand on State rental stock. Those announced yesterday were:

• The building of 750 new units, including 30 emergency houses. The target is the same as that set last year and again priority will be given to areas of greatest need such as Auckland, Manukau, and Hamilton.

• The introduction of a three-year development programme to provide the corporation with up to 2500 new residential sections.

“These policies, as well as the recent important decision to allow the Housing Corporation to raise finance for lending programmes on the open market, will give it considerable flexibility in meeting housing needs, especially for the low-income family,” Mr Friedlander said.

The Labour Party’s acting spokesman on housing, Mr M. K. Moore, described the programme as “a predictable election year face-lift” which merely gave back part of what was taken from desperate home-seek-ers last year.

He said that the Government had offered more three years ago than it had this year and that the policies contained nothing to offset the effect of its interest rate regulations on mortgage finance. “This package simply dresses up what in most cases amount to cut-backs in the housing programme over previous years and attempts to sell them as something new and positive,” he said.

The $24 million allocated to home improvement loans represented “a dramatic cut in real terms on the $2B million provided for the purpose only two years ago,” he said. Mr Moore said that the promise to build 750 additional State houses compared poorly with the more than 3000 provided by the Labour Government in 19751976 and that it would do little to ease the housing crisis that National had

created. “National continues to sell off more rental units than it replaces which is why the total stock is now down by over 2000 compared with only three years ago,” Mr Moore said. Labour was “putting together a comprehensive package” which, through more efficient use of funding, might provide help for up to 50,000 low and middle income home-seekers each year,” he said.