BNZ joins $900m loan guarantee to boost social housing

BNZ has welcomed the government’s new $900 million loan guarantee scheme, which aims to make it easier for registered Community Housing Providers (CHPs) to access affordable finance and accelerate social housing delivery.

Under the scheme, the Crown will guarantee 80% of eligible CHP lending, allowing banks to offer more competitive rates and terms to the sector. With more than 19,000 applicants on the Housing Register waiting list, the initiative is designed to help CHPs compete on a level footing with state housing provider Kāinga Ora.

The government said the scheme is part of a broader commitment to deliver over 2,000 new social homes with CHPs, ensuring they can borrow at lower cost and on more flexible terms. Finance Minister Nicola Willis said it means “more access to capital to get building, and more roofs over Kiwis’ heads.” Housing Minister Chris Bishop added that by reducing the amount of capital banks must hold against loans, “banks can provide reduced interest rates to community housing providers” and improve lending terms.

BNZ commits $125m for community housing finance

BNZ general manager of property finance Kieran Ryan (pictured) said the bank was proud to play a role in the initiative, with $125 million already committed for CHP lending.

“The vital work that Community Housing Providers do by supporting vulnerable New Zealanders into homes, has often been challenged by the cost of accessing the funding needed to progress developments," Ryan said in a media release.

“The government’s scheme changes that equation, reducing risk for lenders, and enabling financing to CHPs that better reflects long-term, stable revenue from their government contracts.

“BNZ is committed to participating in this scheme and working alongside CHPs to help deliver more social housing where it’s needed most."

Levelling the playing field for CHPs

By reducing risk for lenders, the scheme is expected to unlock additional housing supply and provide long-term certainty for CHPs reliant on government contracts. For advisers and brokers, the development could expand opportunities in the community housing sector, particularly for organisations that previously struggled to secure competitive financing.

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