Following the money: Understanding the building industry’s exit from affordable housing production

Kay Saville-Smith

Abstract – Tuhinga Whakarāpopoto

The NZ Productivity Commission’s 2012 report suggested the building industry has largely stopped building in the lower value segments of the housing market. This research bulletin suggests an explanation is the significant withdrawal of government capital assistance and investment in affordable housing. Although there has been a re-introduction of income related rents for state housing and some community housing provider tenants, the government is now distant from the building industry’s previously higher and sustained levels of affordable housing production.

Other reports associated with this research

Murphy, L. (2020). Neoliberal social housing policies, market logics and social rented housing reforms in New Zealand. International Journal of Housing Policy, 20, 2, 229-251, DOI: 10.1080/19491247.2019.1638134

Murphy, L. (2020). Performing calculative practices: residual valuation, the residential development process and affordable housing. Housing Studies, 35, 9, 1501-1517, DOI: 10.1080/02673037.2019.1594713

Saville-Smith, K. (2017). Thinking about the logics of affordable new build delivery: Some preliminary thoughts on the structural position of different types of new-builders. Report for Building Better Homes, Towns and Cities SRA: The Architecture of Decision-Making, June 2017. Wellington: BBHTC.

Articles associated with this research – Karere Tūhono

Media: Simon Wilson on the housing crisis: What governments did wrong

25 February 2020: A NZ Herald article (paywalled) by Simon Wilson features research by Building Better researcher Kay Saville-Smith.

“This is a story of collapse, all told in one remarkable graph.

“The graph was created by Kay Saville-Smith, a social scientist who specialises in housing. Saville-Smith knew there had been a long-term decline in the construction of low-cost housing. The Productivity Commission had already identified it. The purple line on her graph shows it. But she wanted to know why, so she pored through decades of raw data, looking for the cause.

“She found it,” writes Simon Wilson. >> Read more

Media: Queen’s birthday: NZ’s housing system broken, says researcher

04 June 2018: One of Building Better Homes, Towns and Cities lead researchers in the Architecture of Decision Making research programme, Dr Kay Saville-Smith, has been awarded the New Zealand Order of Merit in the 2018 Queen’s Birthday Honours. She discusses with reporter Chloe Ranford her recent research into the building industry’s shift from building low value houses to building high value houses. >> Read more

Case Study: Investing in affordable homes

Originally published in Build magazine, issue 163, December 2017.

02 December 2017: While central and local government are encouraging new builds and the release of land for residential purposes, high numbers of residential new builds are not affordable housing for those with limited resources. >> Read More

Keywords – Kupu Hāngai

Housing, house prices, urban development, new builds, housing affordability, policy mechanisms, alternative housing, economics

Fields of Research – Āpure Rangahau

Economics; Housing supply


Date – Te Wā Whakarewa



Type – Te Auaha

Research Bulletin

Citation – Kupu Hautoa

Saville-Smith, K. (2018). Following the money: Understanding the building industry’s exit from affordable housing production. Research Bulletin, 5pgs, Wellington: Building Better Homes, Towns and Cities.