Landlords joined in the initiative to earn more
An investigation has revealed that the Ministry of Social Development (MSD) initiative to provide emergency housing has worsened the housing crisis in New Zealand as landlords took rental properties off the market to rent them out to MSD to earn more money, according to Newsroom.
The MSD told Newsroom that the Emergency Accommodation scheme worsened the rental crisis as it encouraged landlords to take rental properties off the market to rent them out to the government to earn more. When the landlords ran out of properties to rent out to MSD, they turned to real estate agents who procured vacant properties allegedly without the property owners’ consent.
The Emergency Accommodation scheme helped people to live in motels and hotels at market rates of over $120 per night for each room rented. In 2018, the MSD extended the scheme to include private homes. It continued to pay the same motel room rates to landlords for each rented room in the house without visiting the properties and checking if they met basic living standards, reported Newsroom.
A former Harcourts Real Estate property manager in South Auckland revealed that landlords were paid up to $3,000 weekly by taxpayers for “marginal to uninhabitable” private rentals.
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Mangere East Family Services social worker Alastair Russell said the homes MSD paid for were often “marginal to uninhabitable.”
“Houses without stoves and ovens [and] houses that were essentially building sites with debris scattered both in and outside the house. You’re talking planks of wood with nails sticking out of them, broken glass, and families with kids that had to go into those houses. No-one was going in there and checking the places out,” Russell told Newsroom.
Minister of Social Development Carmel Sepuloni commented: “This is an operational matter for the ministry. However, I have requested a briefing on the issue from MSD. Where there are vulnerable families and whānau that require emergency accommodation and assistance, I expect MSD to be doing what they can to support people to access the support they are eligible for.”
