The New Zealand Government has initiated a support programme for residential construction.
The New Zealand Government has introduced a new initiative to bolster the residential construction market amid economic challenges. The Residential Development Underwrite (RDU) programme is designed to help developers secure necessary financing, ensuring the continuation of housing projects despite high interest rates and low building consent rates.
Key Points:
Eligibility: The programme targets projects with at least 30 houses, requiring developers to have a proven track record and necessary consents.
Flexibility: There are no price caps or buyer restrictions, making the programme accessible to a wide range of developers.
Focus Areas: While the support is available nationwide, it prioritizes high population areas like Auckland, Hamilton, Tauranga, Wellington, and Christchurch.
Ministerial Statements:
Housing Minister Chris Bishop emphasized the programme’s role in stabilizing the housing market by ensuring houses are ready for buyers as interest rates drop.
Building and Construction Minister Chris Penk highlighted the programme’s importance in providing confidence and support to the construction sector during tough economic times.
Commencement:
This initiative is part of the Government’s broader efforts to address the housing crisis and support the construction industry. The RDU programme is set to begin immediately, providing timely support to the sector.
Next Steps:
Over the next few weeks, the Ministry of Housing and Urban Development will engage with residential developers, banks, and lenders to ensure that only projects meeting the eligibility criteria apply. Registrations for the programme will open at 10am on Monday, 7 October.
Funding:
Funding for the RDU will be redirected from unused allocations from the Kiwibuild and BuildReady Development Pathway programmes, both of which are now closed to new applications.
Additional Information:
Details on the RDU, including eligibility criteria and the schedule for a residential developer webinar briefing, can be found on the Ministry of Housing and Urban Development’s website.
What are the Benefits?
The RDU programme offers several benefits:
- Increased Access to Finance: Helps developers secure funding for housing projects.
- Market Readiness: Ensures houses are ready for buyers as interest rates drop.
- Flexibility: No price caps or buyer restrictions, making it accessible to a wide range of developers.
- Targeted Support: Focuses on high population areas butRDU is available nationwide.
What is RDU and When Will the Scheme Begin?
The Residential Development Underwrite (RDU) programme is designed to support residential construction by providing underwrites to credible developers. This helps them secure the necessary financing to proceed with housing projects. The scheme is set to begin immediately, providing timely support to the sector.
Source: Beehive Releases