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Tackle Housing Shortage First, REINZ Tells Government

Prime Minister Jacinda Ardern’s first budget will be released tomorrow (Thursday, 16 May), and Bindi Norwell, chief executive at the Real Estate Institute (REINZ) will be watching closely.

14 October 2021

She writes about why the organisation wants the housing shortage to be tackled.


New Zealand currently has a significant housing shortage across the country, and the Auckland shortage is around 60,000 properties alone.

Until we’re able to start to back-fill some of that shortage, houses are only going to continue to remain unaffordable for first-time buyers and those on lower incomes. Therefore, it is essential that a solution is found to this problem to help reduce the shortage and drive housing developments forward.

Part of that solution needs to include a programme which ensures houses can be built quickly to keep up with demand. There needs to be less red tape for local councils and developers to deal with, and we need to build warmer/drier homes than we’ve seen in the past. Significant funds need to be invested in the KiwiBuild programme, as it is the obvious solution to the problem.

One way to build houses more quickly is to include high-quality prefabricated homes and building processes as part of the KiwiBuild programme. For example, the use of prefabricated building techniques can save significant time on a building site, as many of the components are built off site – in some cases this has been as high as 60 per cent.

Additionally, it means less disruption for neighbours, particularly from a noise pollution perspective, as much of the ‘noisy’ work can be done offsite in factories. According to PrefabNZ, the membership organisation that informs, educates and advocates for innovation and excellence in offsite design and construction in New Zealand, the speed at which prefabs can be built will result in a 10 per cent lift in construction industry productivity.

Additionally, we need more investment in social housing. In terms of the ‘social’ aspect of housing, homes need to be:

1. Affordable – in order to ensure first time buyers are able to enter the market as home ownership is at its lowest point in 60 years;

2. More flexible – to meet the demands of the population and to respond to the changing dynamics in family sizes such as providing variety across smaller and larger homes;

3. Readily available – especially for those who need social/emergency housing requirements.

Lastly, we would like to see money put aside for grants (for example, insulation) to help continue raising the quality of New Zealand’s housing stock.


The retail investment market is under significant cost pressure to provide renters with housing stock that meets legislative requirements. Within a relatively short space of time the Healthy Homes requirements were passed, the methamphetamine standard was used as a reference for tenancy tribunal adjudicators, the asbestos requirements have been implemented, and the Bright Line tax has been extended to five years – all of which comes at a potential cost to investors.

Also, recently announced is the proposed ban on letting fees and a proposed end to the negative gearing rules.

These two further pieces of legislation could potentially backfire, in that it causes significant cost to investors and leads to a significant shortage in rental properties as investors sell their properties.

Landlords provide a valuable service to our communities across the country and we are concerned that this service is being forgotten by a government that is confusing them with speculators, who are only in the market for the short term and are out to make a quick profit.


REINZ would like to see investment in infrastructure to expedite the building of satellite cities and to support developers in being able to build more properties in order to help reduce the housing shortage.

Regional Investment

REINZ welcomes the NZ$1 billion Provincial Growth Fund that was launched in February by the Minister of Regional Economic Development, Shane Jones.

Investment in some of these major projects in the regions will boost tourism, create new job opportunities, and allow regional New Zealand to flourish, which is essential in order for the wider economy to continue on a strong growth path.

It is essential that the money already designated for the regions in these announcements remains available and that it doesn’t get diverted towards other projects.


Investment in public transport needs to be a priority for the government, particularly in our largest cities, where housing development continues to move further from the CBD where there is significant availability of greenfield/brownfield land available for residential housing.


REINZ would like to see resources allocated towards upskilling New Zealanders to help meet the housing shortage. Construction and building-related courses need to be given urgent funding.


We need enough people to be able to complete the KiwiBuild programme and end New Zealand’s housing shortage.

Whether that is in the form of a ‘KiwiBuild visa’ or some other initiative, it is imperative that Labour’s immigration targets don’t affect the speed with which we build houses.

In the long run, this could end up hurting New Zealanders, as our housing costs continue to remain unaffordable for first-time buyers and those on lower incomes.

This was a press release sent out by REINZ.

First published 16 May, 2018.

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