Accord welcomes new residential construction sector support
The Construction Sector Accord welcomes two initiatives to support the residential construction sector – a $350 million Residential Development Response Fund, and the Progressive Home Ownership Fund.
The Residential Development Response Fund
The Residential Development Response Fund, announced today by Housing Minister Dr Megan Woods, is being established to help the residential construction sector and to minimise the economic impacts of COVID-19. It will help to progress stalled or at-risk developments by sharing some of the increased COVID-19 related risks by backing developments through Government underwrites.
The Fund comprises $100 million from the COVID-19 Response and Recovery Fund (CRRF) and $250 million of redirected funding from the KiwiBuild appropriation following last year’s reset.
It’s estimated the fund will maintain around 15,000 jobs and the building of around 4,000 new homes, that otherwise might not be built because of barriers to developers securing finance.
The Fund will help cushion the impact of COVID-19 by supporting residential construction jobs, and ensuring the sector is well positioned to accelerate housing delivery as the market recovers.
The Housing Minister expressed her thanks to sector leaders who have engaged through the Construction Sector Accord with officials and Ministers. Minister Woods said that direct feedback has been critical to shaping the government’s response.
The Accord is working with the Ministry of Housing and Urban Development on the design of the Fund to ensure integration of Accord principles and outcomes.
The Progressive Home Ownership Fund
The Progressive Home Ownership Fund, which was announced last month, will help families become home owners by partnering with a housing provider to help them share the cost of a mortgage and address the deposit barrier.
The Fund has a specific aim to address housing affordability issues for three priority groups: Māori, Pacific peoples, and families with children. The Fund will also support the delivery of new supply, as there will be a preference to fund new builds, across parts of New Zealand where housing affordability is most severe.
Accord Transformation Director Dean Kimpton says these initiatives are vital to support the construction sector post the COVID-19 lockdown.
"To ensure a resilient and productive construction sector, we know that support is needed across the board. The residential industry is a vital part of the sector and we are pleased to see support for both those in the sector and potential homeowners."