New Zealand Housing Fund to Deliver 823 Homes in High-Need Areas

Housing Minister Chris Bishop said the programme is being supported by Budget 2025 funding that includes NZ$41 million in operating funding and about NZ$60 million in capital funding.

New Zealand's first round of investment through the Government's Housing Flexible Fund is set to deliver 823 new social and affordable homes across nine locations, surpassing the original target of between 675 and 770 homes and directing much of the funding towards communities facing significant housing pressure.

Housing Minister Chris Bishop said the programme is being supported by Budget 2025 funding that includes NZ$41 million in operating funding and about NZ$60 million in capital funding. South Auckland, the Far North, Eastern Bay of Plenty and Gisborne-Tairāwhiti will receive the largest numbers of homes, reflecting the Government's assessment of where housing demand is particularly high.

The Flexible Fund was established in 2025 as a contestable funding programme for social housing and affordable rentals, replacing several separate programmes. It works alongside the Housing Investment Plan, which uses evidence about housing demand, household needs and local conditions to guide where public investment should be directed.

South Auckland leads first round of housing delivery

South Auckland will receive 190 homes, the largest allocation under the first tranche, followed by 151 in the Far North, 133 in Eastern Bay of Plenty and 118 in Gisborne-Tairāwhiti. Wellington will receive 55 homes, Christchurch 53, Hamilton and Tauranga 50 each, and Hastings 23.

Around half of the 823 properties are expected to become social housing, with the other half operating as affordable rentals. More than 30 Community Housing Providers are involved in delivery, including a number of Māori housing providers with established relationships and experience in communities where housing needs are high.

The first procurement round has now been completed, with the first homes expected to be finished and available for tenants from July 2027. The Ministry for Cities, Environment, Regions and Transport will work with preferred delivery partners to approve individual projects and complete contracting arrangements.

The types of properties being funded also reflect demand on the housing register. More than 60 per cent of people currently on the register require a one-bedroom property, according to the Government, while more than 75 per cent of homes progressing through the Flexible Fund will contain one or two bedrooms.

Community providers encouraged to expand projects

The contestable model allows Community Housing Providers to propose projects based on their knowledge of local housing needs rather than relying solely on centrally designed developments. Ministers say this has encouraged some organisations to increase the number of homes they can deliver beyond those directly supported by government funding.

Ōtautahi Community Housing Trust, for example, has committed to providing an additional affordable rental property for every home it receives government funding to deliver through the programme.

The Government has also introduced measures intended to reduce financing costs for Community Housing Providers. A liquidity facility for the Community Housing Funding Agency and a Bank Guarantee Scheme for lending to providers were established in 2025, giving parts of the sector access to cheaper borrowing.

Bishop said some providers have been able to refinance borrowing carrying interest rates of around 8.5 per cent into fixed rates as low as 4 per cent for periods of three to five years. Lower financing costs can give providers more capacity to develop homes while making longer-term projects easier to plan.

Government plans thousands more homes through fund

The latest investment sits alongside several other housing commitments. Budget 2024 provided NZ$140 million for 1,500 new social homes, while Budget 2025 included another NZ$128 million supporting more than 600 social homes in Auckland in addition to the first Flexible Fund allocation.

Budget 2026 added NZ$69.2 million for a second Flexible Fund tranche, which is expected to support between 1,800 and 2,250 additional homes beginning in 2028/29. Work is underway on another Housing Investment Plan that will determine how this funding is distributed over a three-year delivery period from July 2028.

Taken together, the Government expects these investments to provide between 4,800 and 5,200 additional social homes and affordable rentals, while future Budgets could add further funding to maintain a longer-term construction pipeline.

Since the current Government took office, more than 8,400 social housing places have been delivered nationally, according to figures cited by Bishop, while the social housing waitlist has fallen from 25,483 to 19,003. Ministers acknowledge that substantial demand remains and say further investment and changes to the housing system will be needed to provide suitable homes for New Zealanders still waiting for assistance.