Government pays twice the price for emergency housing motels

Press Release – New Zealand Labour Party

Government pays twice the price for emergency housing motels with two more on the way16 August 2017

Government pays twice the price for emergency housing motels – with two more on the way

Under Labour’s plan to build at least 1000 state houses each year, New Zealand wouldn’t be paying more than double the valuations for motels to house Kiwis needing emergency housing, says Labour’s Social Development spokesperson Carmel Sepuloni.

“Under questioning today, the Government revealed it has plans to buy another two motels to house Kiwis in need of emergency housing, in addition to the four it has already bought.

“Labour has discovered that the Government has paid more than twice the price for these motels, with each purchase exceeding double the most recent QV valuations. These valuations are between one to three years old, but property prices haven’t doubled in that time.

“What’s really concerning is that in each of the cities where the motels have been bought, the Government has sold off much-needed state houses.

“In Gisborne, where there has been a loss of 62 state houses, the Government paid $2,150,000 for a motel valued at $910,000. In Hastings, where there has been a loss of 14 state houses, the Government paid $1,840,000 for a property valued at $900,000.

“In Napier, where there has been a loss of 137 state houses, the Government paid $1,850,000 for a property valued at $910,000. Meanwhile, taxpayers have bought a motel in Auckland for $2,650,000, again more than twice the QV valuation.

“It’s simply irresponsible and poor planning by the Government to be paying these sums for motels while continuing to sell off state houses.

“New Zealand must do better than this. We can do better than this.

“Instead of selling off thousands of much-needed state houses, Labour would ensure Kiwis in need of warm, dry homes would get the accommodation they desperately need,” says Carmel Sepuloni.

Name Location Purchase Price* Latest valuation # units Cost per unit
Cimarron Motel Auckland $ 2,650,000 $ 1,300,000 11 $240,909
Eastland Motor Lodge Gisborne $ 2,150,000 $ 910,000 19 $113,158
Clansman Motor Lodge Hastings $ 1,840,000 $ 900,000 10 $184,000
Napier Garden Motel Napier $ 1,850,000 $ 910,000 13 $142,308
Totals $ 8,490,000 $ 4,020,000 53 $160,189

* Response to Parliamentary Written Question 06060 (2017)

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