5. Question No. 5—Housing and Urban DevelopmentHon JUDITH COLLINS (National—Papakura) to the Minister of Housing and Urban DevelopmentQuestion No. 5—Housing and Urban Development5. Hon JUDITH COLLINS (National—Papakura) to the Minister of Housing and Urban Development: How many unsold KiwiBuild houses have been bought by the Crown as part of the underwrite and in what developments have these purchases occurred?Hon PHIL TWYFORD (Minister of Housing and Urban Development): I am advised that the Ministry of Housing and Urban Development has purchased five homes at Northlake in accordance with the terms of the contract.Hon Judith Collins: Will KiwiBuild pay any real estate marketing costs of selling KiwiBuild houses that have been purchased by the Crown as part of the underwrite and later sold to eligible buyers?Hon PHIL TWYFORD: KiwiBuild will pay the marketing costs when it's selling homes that are owned by the Government. At Northlake there are five homes that the Ministry of Housing and Urban Development has purchased and six out of the 10 homes built in the first tranche have sold.Hon Judith Collins: Who will pay for the upkeep and maintenance costs while houses purchased by the Crown sit unsold?Hon PHIL TWYFORD: The owner will pay the upkeep and maintenance costs but the fact that these homes are temporarily in the ownership of the Government while they're on sale and being marketed to KiwiBuild buyers is not a matter for concern. This programme is about sharing the pre-sales risks with developers to ensure that more affordable homes are built and that is what's happened.Hon Judith Collins: Is it correct that he has approved binding contracts for more than 200 KiwiBuild houses to be built in Wānaka even when only five of the current houses have sold?Hon PHIL TWYFORD: Well six of the current houses have sold. They've only been completed in the last few weeks and it's true to say that the Queenstown-Lakes District has the most expensive housing in New Zealand. Lower-quartile house prices in the district are at $825000. On average the KiwiBuild homes in that development are selling in the low $500000s. Interest.co.nz's housing affordability report puts mortgage payments in that district at 57 percent of income for first-home buyers.Hon Judith Collins: I raise a point of order Mr Speaker. The question is: has he approved binding contracts for more than 200 KiwiBuild houses to be built in Wānaka? I don't think he's addressed that question.Hon PHIL TWYFORD: Yes I have: over the next three years.Hon Judith Collins: How will costs associated with purchasing KiwiBuild houses impact the Government's ability to recycle revenue and build 100000 houses over 10 years?Hon PHIL TWYFORD: The point of the underwrite is that we're sharing the pre-sales risk with developers. Those funds as in the six homes that have sold at the Northlake development in Wānaka—that money is then recycled back into the programme and more homes are built. As was shown in the business case for the Buying off the Plans scheme the projected net cost is zero because the funds are recycled.Hon Judith Collins: How can the developer be sharing any of the downside on this when actually it's the Crown and KiwiBuild that are going to have to pick up all the costs of any losses? Hon PHIL TWYFORD: Well there are a number of risks that developers face in building homes. The point of this programme is to share the pre-sales risk. Fewer than 5 percent of new builds over the last decade have been in the affordable price range. This is about incentivising developers to build affordable homes and it's working.