Developments in five big cities across New Zealand will have to deliver at least 200 new homes to be eligible for the Government's multibillion-dollar Housing Acceleration Fund.
Announced in March, the Housing Acceleration Fund is intended to help pay for roads, pipes and other infrastructure. It came alongside a raft of tax changes and deposit assistance eligibility tweaks to try and bring down ballooning house prices.
But not all the $3.8 billion is available yet. Housing Minister Megan Woods has released a subset of the funding, at least $1 billion, under the name Infrastructure Acceleration Fund (IAF).
An invitation for expressions of interest will be released on June 30. The IAF will be opened to councils, iwi and developers and will prioritise funding for projects that deliver a steady pipeline of infrastructure for housing developments.
The money will be prioritised for brand new developments on new land and places where infrastructure investments might otherwise not be funded, or not funded quickly enough to meet housing demand.
It will also align with wider Government objectives such as good urban planning, partnerships with iwi and Māori and transition to a net zero emissions economy.
A spokesperson for Woods told Newshub decisions are yet to be made on what the rest of the Housing Acceleration Fund will be spent on. It could be spent on opening more land for housing, which is listed as one of the purposes of the fund.
In major urban areas, such as Auckland, Tauranga, Wellington, Christchurch and Hamilton, projects will be expected to deliver at least 200 additional homes per development.
In other areas that are not so large, projects will be expected to deliver at least 100 additional homes. This will apply to Whangārei, Rotorua, New Plymouth, Napier-Hastings, Palmerston North, Nelson Tasman, Queenstown and Dunedin.
In other areas of the country, projects should result in at least 30 new homes.
"Not every application will be funded; we have weighted the fund to support projects that will deliver the most houses where they are most needed," Woods said on Tuesday.
"In order to bring on significant new supply we need to fund larger scale projects in large urban areas, as well as smaller scale projects outside of the main centres, where there is also a housing shortage.
"We've been proactively working with Local Government New Zealand since the March announcement to identify these smaller scale opportunities. We know that the housing crisis is being felt right across New Zealand."
In addition to accessing the Infrastructure Acceleration Fund, Māori will have access to the Māori Infrastructure Fund, of which there will be $350 million ring-fenced or guaranteed. Details of how Māori and iwi developers can access it will be announced in August.
Housing is shaping up to be one of the Government's biggest challenges with house price growth showing no sign of slowing down in part due to lagging supply. Real Estate Institute data last week showed residential property prices increased by 32.3 percent from $620,000 in May 2020 to $820,000 in May 2021.
But there are some promising signs. Building consents were at an all-time high last month. Stats NZ data showed that in March, 4128 new homes were consented - the highest number since the 1940s.
The Government is also repealing the Resource Management Act, blamed for holding back development of new housing due to its complexity.
