Social Housing: Crisis and an Opportunity

Some streeties have died of exposure recently. Others are sick. Government has admitted that for many people asking for housing assistance there is nowhere for them to go. Many thousands are sitting on social housing lists. The cost to social agencies, the justice system, prisons, and hospitals is excessive.

This is only going to get worse unless more social housing is built. At 3.8% our levels of housing stock is sitting at half the OECD average and we have a growing ageing population that will also need affordable housing. A quarter of those sleeping rough are retirees.

The new report "A Place to Grow Old" from the Aged Care Ministerial Advisory Group led by David Cunliffe finds supporting people at home is one seventh the cost of residential care, which is itself a quarter of the cost of a hospital bed. (Support can look like a mix of tech tools eg. monitors that indicate if someone hasn’t got up - and regular calls from real people to check in).

So, why don’t we? I think it is about how we think of housing entirely differently to other forms of infrastructure.

Infrastructure investment sets the foundation that allows society to be productive. As a society we will invest in roads, transport, schools and ask for reasonable and affordable contributions towards it when one uses it.

Housing on the other hand (along with energy - but I’ll leave that for another time) seems to be seen as the end goal of economic activity rather than a starting point. If you are born to parents with a secure home, you are much more likely to start well and get a home yourself and then retire with one. The opposite holds true. A quarter sleeping rough are older people, roughly half of those experience severe housing deprivation or homelessness are under 25.

Consider how different types of infrastructure is funded. Some is entirely rates/taxpayer funded: eg stormwater, courts, and prisons. This makes sense - managing these things in a coherent way is in all our interests. Also hospitals (albeit there are private alternatives).

Some is government fully or partially owned but managed by the market and is user pays, for profit (the Port of Auckland & energy companies) or not-for-profit (Watercare).

The majority - roads, transport, schools, health service, social housing (3.8% of housing stock) is a mixed model of rates/taxpayer funding and user pays.

96.2% of housing is left to the market. It is only recently that the idea of housing as infrastructure has been mooted at all. (And as for climate resilience infrastructure and adaptation that is firmly in the too hard basket. but we’ll get to that also another time).

But why? The assumption that underlies infrastructure investment is that it is good for NZ Inc by enabling economic activity and ensuring society, and the people within it, functions properly, and the costs will be clawed back in part by appropriate user contributions, but also greater productivity and profits.

Each business case should be rigorously testing those assumptions. And we should be particularly asking whether with inflation, climate change, and changing demographics whether some forms of investment, eg. transport stacks up against other sorts of infrastructure, like social housing. If you don’t build a road journey times may be a few minutes more (you could move closer to your job). If you don’t have a roof over your head it’s hard work to stay alive never mind do anything else.

There is a major opportunity cost here to the economy and in human potential by lack of affordable housing. We have unacceptable levels of child poverty and youth unemployment. The stress of those struggling to retain tenancies, get food on the table and find a job at the moment is putting many parents and their children under terrible strain. This is not a good start in life but people at every stage of life need decent homes.

The construction sector needs contracts. Young people need jobs. Could we maybe join these needs and opportunities up? To save on expensive new construction materials conversions of existing buildings might play a role. Tall office buildings were designed with lifts, are accessible and well-located. Just a thought: the Cheshire designed SKHy apartments in Grafton are stunning.

Housing should not be the end goal of life but the foundation of it, so that we might lead good lives in every sense, where we can make a positive contribution and enjoy the benefits of that.

Mā te huruhuru ka rere te manu - give the bird feathers so it can fly.