Affordability not the problem for working homeless in Queenstown

The Housing Minister Megan Woods was in Queenstown recently to listen to concerns regarding the local area’s acute shortage of available housing. I applaud the Minister for venturing south to actively listen to a wide range of audiences, however, I left a business leaders session with some frustrations.

The Minister has boiled Queenstown-Lakes’ problem down to an acute shortage of affordable housing that we must build our way out of, but this belittles our short-term problem. Yes, we have a desperate lack of housing that is affordable, but we also have a complete absence of houses available for rent at present at any price.

Many people living in cars in Queenstown are not poor, with most employed and earning far more than even a living wage – they simply can’t find a house to rent at any price point.

Few new homes make it into the rental pool

Over recent years, Queenstown has built homes like crazy – thousands more than we need to keep up with population growth, but the problem is very few make it into the rental pool. At the 2018 Census, we had an unoccupied housing stock far higher than the national average at 27% of homes on Census night.

And to make matters worse, our rental market is going in the wrong direction. A perfect storm of well-intentioned policies such as healthy homes, removal of interest deductibility and changes to the Residential Tenancy Act, have left many local homeowners reluctant to put their homes in the rental pool and many have decided it is too hard or that alternates such as Airbnb are too appealing. The Minister refuted this claim by quoting data on rentals saying that Queenstown-Lakes has more rentals than it did pre-Covid.

That message only tells part of the story. Queenstown-Lakes currently has 4,077 active rentals as at February 2023 – this figure is slightly (126 rentals) above its pre-Covid level of 3,951 in February 2020. But over that same period we have had cumulative population growth of thousands of people – so more people chasing a barely changed rental pool.

The situation for renters has deteriorate over the past year

The story for renters looks more dire when we consider changes in the rental pool over the past 12 months – if we look at a period from June 2022 to January 2023, the number of houses actively being rented in each of these months was 15 to 81 homes less than in the same month the previous year. In February 2023, we had our first month where rentals had increased compared to the previous year, with a mere 6 rental home lift from February 2022.

These kinds of movements in the rental stock don’t even scratch the surface of our worker accommodation challenge when you consider businesses have hired more than 1,000 extra staff over the past year and that there were well over 1,000 additional homes built in the district.

Quick fixes need to focus on what’s there, not building new

I hope that the Minister’s return journey to Wellington was full of reflections, and that the Queenstown voice has been heard. Winter is coming, and urgent levers are needed to support landlords to offer up even a tiny fraction of Queenstown’s vacant housing to tenants over the colder months. But I won’t hold my breath.

When asked in a recent media interview for quick fixes, I said that the focus needs to be on levers to encourage better use of our existing housing stock.

In jest I suggested, “Put it this way, if someone gave me a crowbar and immunity from prosecution, you could solve it [the housing shortage] overnight. There are physically enough beds and enough sheets in this town to house everyone, it’s just availability and use of housing.”