The government’s recent NZ$69 million investment in the contestable Flexible Fund , the main funding source for iwi and community housing providers, prioritises social housing and affordable rentals.
Author
- Simon Louis Opit
Public Health Researcher, Te Kunenga ki Pūrehuroa – Massey University
While the investment is welcome, the policy risks overlooking another role these organisations can play: helping working renters move towards home ownership.
These households sit in the difficult middle of the housing system . They earn too much for social housing, but are unable to save a deposit or buy on the open market.
Many face high rents, insecure tenancies and repeated moves when landlords sell. Recent research found a quarter of private renters spend more than a 40% of their disposable income on rent.
A growing number of community housing providers now deliver affordable home ownership models, including shared ownership, rent-to-buy and community land trust arrangements.
These schemes increase tenure security and reduce housing costs, allowing some households to achieve home ownership that would otherwise be impossible and helping others reach that goal sooner .
Previously, the $400 million Progressive Home Ownership Fund helped expand these models by offering interest-free loans to approved providers delivering rent-to-buy, shared ownership and leasehold schemes. But the fund was closed mid-2024 and is no longer accepting new applications.
Since then, policy has shifted towards increasing open market housing supply through the government’s Going for Housing Growth programme .
If affordable ownership is left out of the Flexible Fund, the government may miss one of the few pathways to home ownership available to working renters locked out of the market.
To investigate why and how much these models matter, we interviewed households across Aotearoa New Zealand . We found home ownership schemes can make a significant difference but need careful and transparent design.
A place to call home
Across the interviews, households described these schemes as a way out of private renting.
Tiana and her young family entered a progressive home ownership scheme in Rotorua after severe housing insecurity. They had moved for work, but the rental they had lined up was leaky and substandard. With nowhere else to go, they ended up in emergency housing.
While considering their options, Tiana heard about Habitat for Humanity’s progressive home ownership programme. It offered a secure home, beginning with a rental phase designed to prepare them for ownership. Their new home was warmer, cheaper to heat and healthier for their children.
Stepping into this house that day was emotionally huge […] It’s a relief to actually own a piece of land […] to say to your children and grandchildren, that’s where our journey began.
For others, affordable home ownership meant staying in the communities where they lived and worked.
The Queenstown Lakes Community Housing Trust runs one of Aotearoa’s earliest home ownership schemes. It is a community leasehold model where households buy the home but pay a small ground rent for the land, reducing the upfront cost.
Lucy and her children had been living in one of the trust’s affordable rentals while waiting for a home. By providing both an affordable rental and a home ownership pathway, the trust gave them a way to remain in their community, where buying on the open market would have likely been impossible.
I love Arrowtown, it’s our community, it’s our life […] if I wasn’t that connected to the community and the place, maybe I would look elsewhere.
The edge of affordability
Affordable home ownership does not remove all risks. Households still face mortgage payments, rates, insurance, maintenance and rising living costs .
Daniel’s experience shows how good support can make those risks manageable. Before entering the scheme, his young family were living in an old, damp rental in South Auckland. Owning seemed impossible. Although Daniel worked full time, he had debt and a poor credit history.
Instead of turning him away, the New Zealand Housing Foundation helped the family with credit repair, debt repayment, KiwiSaver and financial advice. They were warned their budget would be tight, but the result was a warm, mould-free home in a quiet neighbourhood where his children could play safely.
Kevin’s story shows why clear processes and careful design are key. After a decade of rising rents, ownership felt urgent. He bought into a shared equity scheme near the top of the market. The home was good quality, but a tight fit for his family of four children, and the location left him with long daily commutes to school and work.
Kevin felt stuck in a house he could barely afford, unable to exit without taking a significant loss. He was no longer sure the model worked for his household.
Everything like groceries and food keeps increasing. We’re not actually saving any money […] so, I’m not going to buy more shares.
These stories show households need careful affordability testing, transparent pricing, financial coaching and honest conversations about whether a particular home, location and ownership structure fits their long-term needs.
This is where the Flexible Fund risks becoming too narrow.
Community housing providers are not just social landlords. Many already help households navigate the difficult space between renting and full ownership. The Progressive Home Ownership Fund built that capacity, but letting that expertise fade would be a missed opportunity.
New Zealand needs more public housing and affordable rentals. But it also needs pathways for working renters who may never reach ownership without support.
Done well, affordable home ownership can offer what private renting often can’t: stability, healthier homes and a stake in the future.
This research was carried out in collaboration with James Berghan (Te Wānanga o Aotearoa), Els Russell (University of Otago) and Ian Mitchell (Livingstone and Associates).
