May 11, 2021

Maori News & Indigenous Views

Government Boost to Whanau wanting to build on Maori Land

4 min read

The government announced today a new agreement which was signed allowing for Maori to access loans which are build on collectively owned tribal lands.

Under the Kainga Whenua programme the Crown will now guarantee the loans in partnership with Kiwibank and Housing New Zealand. Borrowing on collectively owned land has been a significant impediment to developing papakainga projects and other tribal developments.without a deposit.

PapakaingaCWith a Kainga Whenua loan, Kiwibank can lend 100 per cent of house building costs or the purchase price of the house, up to $200,000, as long as the borrower has a right to occupy the land, a valuation from a registered valuer and a satisfactory building contract.

No deposit is required for a loan below $200,000.

Kainga Whenua is available to first home buyers, or people who have previously owned a home and are in a similar financial position as a first home buyer.

Housing spokesperson and Maori Party co-leader, Tariana Turia,was encouraged to see that a key Maori Party policy had been achieved saying:

Our policy priority was to resource iwi and M?ori organisations to develop sustainable housing initiatives… This came from our recognition that Maori often have the land but not the income to service borrowing. We were particularly keen to encourage investment in multiply owned land, so that Maori would be able to experience home ownership on their own papakainga”.

Mr Heatley, Minister of Housing, said demand for the product was likely to be modest, but noted that for many years Maori had been frustrated by their inability to get bank funding for papakainga development, and that Housing New Zealand was dealing with a number of Maori groups interested in helping their people to build on ancestral land.

180 loans are expected to be offered under the scheme in its first year.

Background to Papakainga Loans (now discontinued)

From July 1 2009 Housing New Zealand discontinued their Papakainga loans due to the serious flaws in the overall loan policy and it’s uptake and delivery (see below). Housing New Zealand has been developing an alternative since this time.

Over the last decade, Papakainga Loans were offered to families wanting to construct or acquire a house located on Maori land that was held in multiple ownership. This loan required a fifteen percent deposit which may be reduced if participants successfully complete a homeownership course. This loan option stipulated that if a house is built it must be capable of being moved (as the land is not borrowed on this deposit). The Papakainga scheme was locally managed by iwi (tribal) trusts. However, significant control in the day-to-day business is retained by HNZC.

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Why is Housing New Zealand working with Kiwibank?

Building on multiple owned Maori land can be a long and complicated process. A partnership with Kiwibank enables Housing New Zealand and Kiwibank to test/pilot the processes to ensure they are meeting the customer’s needs. The product may be extended to other lenders in the future.

Housing New Zealand is also partnering with a number of iwi around New Zealand to do larger developments on papakainga land. K?inga Whenua will make home ownership possible on that land.

How do people apply?

Information will be on Housing New Zealand’s website – first step for prospective borrowers will be to contact Kiwibank to see if they qualify and if so how much they can borrow.

What can I build/relocate with a Kainga Whenua loan?

Under a Kainga Whenua loan, the house needs to be:

  • built on wooden piles
  • one storey of at least 70 sq m
  • located on mainland North or South islands
  • have reasonable road access

What are the eligibility criteria for a Kainga Whenua loan?

To be eligible for a Kainga Whenua loan a borrower needs to meet all of the following requirements:

  • Earn up to $85,000 a year as a one or two income household. For three or more joint borrowers, the household can earn up to $120,000
  • Meet Kiwibank and Kainga Whenua lending criteria
  • Provide satisfactory proof of income to Kiwibank
  • Live (or intend to live) fulltime in the house
  • Be a first home buyer, or if you are not, be in a similar financial position as a typical first home buyer in terms of assets and income
  • Have a licence to occupy the land you wish to build on
  • The land needs to be Maori land that can’t be mortgaged, and either owned by four or more beneficial owners or have the land ownership vested in trustees of a trust or incorporation, created under the Te Ture Whenua Maori Act 1993
  • Have a good credit history that is acceptable to Kiwibank

Are the any exceptions to the criteria?

There may be. For instance, properties could be built with concrete floors where alternative security is offered or the lending cap of $200,000 could be increased in special circumstances to allow for larger families.

People should call Housing New Zealand if they want to discuss this further.

How long will it take to get a Kainga Whenua loan?

While getting a loan is usually a simple process, there are complexities involved in securing a licence to occupy multiple-owned Maori land, which can make the process longer.
There will be support along the way from Housing New Zealand and the Maori Land Court.

9 thoughts on “Government Boost to Whanau wanting to build on Maori Land

  1. What about those that haven’t got $85,000 plus earnings to apply for said loans??and have shares in multiple owned land?There’s always a downer on the poor and disadvantaged aye??So wot’s new pussycat?… Just been told I made an identical comment elsewhere.Sorry not from me!Obviously someone else feels the same way.Choice!

  2. What about those that haven’t got $85,000 plus earnings to apply for said loans??and have shares in multiple owned land?There’s always a downer on the poor and disadvantaged aye??So wot’s new pussycat?…

  3. Kia ora
    I have a right to Occupy a section on our land at Whakaaratamaiti Marae in Putaruru from the Land Trustee Komiti.There are several homes built at the marae.
    Can you please advise what is the best avenue to seek funding. I am also planning to cash in my Kiwi Saver towards the home.

  4. kia ora how does one get to apply for an occupation order so we can build on our land their are 11 other owners in the block i want to build on besides myself some are living overseas addresses unknown and some are deceased what do i do?
    thanking you

  5. Firstly you say you and your husband were gifted land then you say the land is run by a whanau trust and then you say you have obtained an occupation order. The above would have required 3 separate application for orders to the Maori Land Court. I'm thinking you were gifted shares and they are held in a whanau trust. The occupation order you have is sufficient if not better than a license to occupy and is accepted by most authorities. In regard a license to occupy, this can be achieved by a variation to the trust order to provide a clause to reflect as such. This should not be to difficult. Happy building.

  6. Kia ora we are going through the process of building our whare on land that was gifted to my husband and I from his mother. The land is runned by a whanau trust and we have just obtained a occupation order for that. However we are both not educated on the system with maori land and are in limbo at the moment on where to go to from now. Fortunately through the kiwibank and Kainga whenua loans they have prapproved our loan for our whare. Is there a guideline we can use to take us through to the next step? How do we get a licence to occupy for the banks preference? Do we need to go back to the maori land court and apply? Please help. Kia ora….

    1. Hi there, I was just reading your comment and it was a long time ago – I do hope you were referred to Housing New Zealand for assistance and now that their is Whanau Ora it would be great for you to contact an organisation that has been funded to assist you in achieveing your dream to build your own home.
      Great to hear that it has been pre-approved. Just keep going its definately worth it and we need more whanau building on their papakainga land. All the best…

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