Source: New Zealand Government
One year on from the announcement of Kāinga Ora’s Turnaround Plan, the agency is getting its books back in order and improving performance – delivering lower build costs, a strong renewals programme, less rental debt, and higher tenancy satisfaction, Housing Minister Chris Bishop, and Associate Housing Minister Tama Potaka say.
“Kāinga Ora’s turnaround is an excellent example of our Government’s drive to fix the basics and build the future,” Mr Bishop says.
“When we came into Government Kāinga Ora was out of control, with debt on its balance sheet rising from $2.3 billion in 2017/18 to $16.5 billion in 2023/24. Kāinga Ora’s 2023 Board-approved budget also showed debt forecast to grow to $24.8 billion by 2026/27. That’s about 20 Transmission Gullies or 12 New Dunedin Hospitals.
“The previous government threw billions into Kāinga Ora, but they had little to show for it. From 2017 to 2023, the social housing waitlist grew from around 7,000 to over 26,000 applicants at its peak in 2022. Labour also deteriorated the social licence for social housing by doing nothing about anti-social behaviour.
“That situation was unsustainable. Every dollar Kāinga Ora failed to manage properly was a dollar that could not go toward providing good outcomes for New Zealanders who need social housing,” Mr Bishop says.
“In February 2025, the refreshed Kāinga Ora Board released the Government-endorsed Turnaround Plan, focused on reducing debt, improving portfolio and build management, and getting the agency back to its core purpose of being a good social housing landlord.”
Reducing debt
“In 2024/25, Kāinga Ora had an operating savings target of $41 million compared to the previous Financial Year, but with hard work and strong cost controls, they exceeded this target and delivered $211 million in operating cost reductions,” Mr Bishop says.
“Kāinga Ora’s strong focus on cost control and efficiency has also flowed through to a reduction in debt.
“Before the Turnaround Plan, Kāinga Ora’s peak debt was forecast to be $29 billion in 2032/33, the Plan brought this down to $21.3 billion, and now – a year into the Plan – debt is expected to peak earlier in 2029/30 at $19.5 billion. That’s a total reduction in peak debt of $9.5 billion, so far.
“These improvements in financial performance have occurred while Kāinga Ora is improving its operational performance – delivering a strong renewals programme, lower build costs, less rental debt, and higher tenancy satisfaction.”
Strong delivery programme
“The Minister of Finance and I made our social housing delivery expectations to Kāinga Ora clear: get your books back in order, get build costs down, then we will consider additional places”, Mr Bishop says.
“To be clear, this Government is still delivering social housing places that New Zealanders need. In Budgets 2024 and 2025, we funded over 2,000 additional Community Housing Provider (CHP) places for delivery from July 2025 to June 2027.
“But when it comes to Kāinga Ora – for now – the agency is focused on keeping its stock at around 78,000 homes while improving the quality and location of those homes through its renewals and retrofit programme.
“To help fund this programme, Kāinga Ora is selling old, expensive to maintain, and unsuitable properties such as multimillion-dollar, 1920s villas. By 2030, around 11,500 older homes are expected to be renovated or replaced.
“It’s a no-brainer to sell homes that are unsuitable for social housing and to reinvest that money into warmer, drier homes that are the right size and in the right locations,” Mr Bishop says.
“In 2024/25, Kāinga Ora delivered a total of 3,456 new homes and 874 upgraded homes. The agency also added 2,564 net new homes to its housing stock, exceeding its target of 2,230.”
Lower build costs
“In 2022/23, Kāinga Ora’s average build cost per square metre was $3,433. I even recall a 9-unit social housing development in Auckland that cost taxpayers around $11 million just to build – that’s $1.2 million per apartment, which quite frankly is a national embarrassment,” Mr Bishop says.
“The previous government assumed Kāinga Ora would deliver housing more cheaply than the private sector through economies of scale. They were wrong: Kāinga Ora’s build costs were 12 per cent higher than the private sector.
“Following the introduction of standardised housing designs and better procurement practices, Kāinga Ora’s build costs are now trending down, with build cost per square metre averaging $3,290 in the first quarter of 2025/26. The agency is also on track to meet its $2,980 per square metre target by June 2026.”
Better outcomes for tenants and communities
“In addition to improving its finances, updating its housing stock, and bringing down build costs, Kāinga Ora is also delivering better outcomes for whanau and communities,” Mr Potaka says.
“Tenancy satisfaction is rising, vacancy rates are lower, fewer tenants are in rent arrears, and Kāinga Ora is doing a better job of managing its tenants to support safe, respectful communities.
“In 2022/23, around 80 per cent of tenants were satisfied with their homes and 70 percent felt safe in their homes and communities. Now, 87 per cent of tenants are satisfied and 90 per cent feel safe.
“More whanau are also making use of Kāinga Ora homes as vacancy rates have dropped from 5% in late 2023 to 2% in December 2025.
“In June 2024, around 8,600 tenants were in rent arrears. As of December, only 5,500 tenants were in arrears – a drop of around 3,000. This reflects clearer expectations, better enforcement, and stronger frontline tools.
“As for the wider community, the previous government effectively did nothing about anti-social tenants, with only two tenancies ended for disruptive behaviour in 2022/23.
“This Government takes anti-social behaviour seriously, allowing Kāinga Ora to take a harder line when needed. In 2023/24, 12 tenancies ended due to disruptive behaviour, and in 2024/25 75 ended.
“Moving tenants on is a last resort and is done in the long-term interests of the wider community, the household, and other people in need on the Housing Register. At some point, enough is enough.
“Kāinga Ora is also doing a better job at taking action and resolving complaints. At the end of 2023, it took Kāinga Ora 72 days on average to resolve a disruptive behaviour compliant, leaving hundreds of Kiwis feeling distressed and ignored. As of December 2025, it now only takes 10 days on average,” Mr Potaka says.
“While there is more work to do, it is clear that Kāinga Ora is getting back on track”, says Mr Bishop.
“Kāinga Ora is now focused on its core purpose of being a good social housing landlord and is delivering better outcomes for tenants and communities, while also delivering better value for taxpayers.
“Ministers would like to thank the Kāinga Ora Board and staff for their hard work in achieving these positive results.
“The Turnaround Plan shows that clear direction and discipline can deliver significant improvements quickly. Th is Government will continue to hold Kāinga Ora to account.”