A render of the proposed Takapuna build-to-rent development. Photo: Supplied by Eke Panuku Development Auckland
Many Kiwi renters have become accustomed to the exhausting task of packing up and moving house every year or two.
But a new 350-apartment development planned for Auckland's Takapuna could signal a shift towards large-scale projects built with long-term renters in mind.
These 'build-to-rent' apartments provide tenancies of up to 10 years, giving renters some peace of mind.
While some say these developments could help to alleviate New Zealand's housing shortage, one developer says more debate is needed before government policy shifts away from the goal of home ownership altogether.
In just a few years' time, a 2875m2 site on Takapuna's Auburn Street could house 350 apartments' worth of new residents.
It would be the North Shore's first major Build-to-Rent development, meaning the apartments would not be sold to landlords but set aside for long-term renters.
Kate Cumberpatch, from Auckland Council's development agency Eke Panuku, said as well as providing security for renters, the new block would provide a big boost for the suburb's businesses.
"Bringing all those people to Takapuna will be great for the diversity, the economic growth, and just the general vibrancy of Takapuna," she said.
Eke Panuku facilitated the sale of the land to developers Cedar Pacific and McConnell Property.
A 2875m2 site on Auburn Street in Takapuna could be the site of North Shore's first major build-to-rent development. Photo: RNZ / Tom Taylor
Although it was not a requirement for this apartment block, Cumberpatch said the council viewed build-to-rent developments positively.
"It's great to be able to have a lot of rental product within Takapuna, in a suburb where house prices are quite high.
"It's great to be able to offer a rental product here that is generally more affordable than owning."
Build-to-rent tenants were able to sign up to 10-year tenancies and were given scope to personalise their homes.
In tenancy agreements, landlords had to give examples of the ways in which tenants could make changes to the property.
They also had to outline their position on pets.
Tenants who agreed to 10-year tenancies were able to end their tenancy with 56 days' notice.
The site of the possible Takapuna build-to-rent development. These types of developments generally allow tenants to sign up to 10-year tenancies and have some scope to personalise their homes. Photo: RNZ / Tom Taylor
Property Council advocacy consultant Denise Lee said New Zealand was falling behind the rest of the world when it came to providing renters with these opportunities.
"It's a really exciting opportunity to transform the renting experience in New Zealand. I think Kiwis genuinely do deserve more choices and more options."
Lee said while the government had started to come onboard by defining build-to-rent as an asset class, some legislation - in particular the Overseas Investment Act - was still lagging behind and getting in the way of the foreign investment needed to get development moving.
"Our members estimated back two years ago that given the right legislative settings, the right support from the government, we could build 25,000 build-to-rent homes in 10 years.
"Every day that goes by, we're actually missing out on the opportunity for a fantastic, professional, long-term, secure, flexible type of rental accommodation."
One of the few build-to-rent developments already up and running in Auckland was the Modal - a shiny black apartment block curving around a corner on New North Road in Mount Albert.
One Model apartment tenant liked the idea of being able to stay for as long as wanted. Photo: RNZ / Tom Taylor
Tenant of two years Juan said the options for long-term leases gave him a sense of security.
"It's good to know that you just have a place to stay for as long as you want, and you can renew it anytime."
But Mark Todd, co-founder of Ockham Residential, the company behind Modal, said although he had invested in the build-to-rent market, he was not convinced it was the solution for New Zealand's housing crisis everyone was hoping for.
"Why are we giving up on the aspiration of home-ownership from a policy point of view?" he asked.
To qualify for exclusions from the interest limitations that apply to most residential properties, build-to-rents must have 20 or more rental dwellings in a single development, owned by the same person or company.
With its 32 apartments, the Modal qualified for these exclusions.
However, Todd said many smaller developers would be shut out of the market because of the requirement.
And Todd said big developers did not necessarily mean better quality homes.
"Don't assume that just because you've got a big guy that's got the pockets to build 1000 units that they're going to be great. You might end up with 1000 warm, dry units that are just devoid of character."
While build-to-rents could provide more security for tenants, there was already legislation in place that was meant to safeguard renters' rights, he said.
Todd said a larger debate was needed before government policy started to favour long-term rentals above New Zealanders' long-standing ambition of home ownership.
