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Part 1: Operating environment

This section provides a summary of the New Zealand operating environment for housing and the key issues influencing the housing sector. A good understanding of the current and future operating environment is essential to planning and carrying out the Corporation's work.

A broad range of factors influences the New Zealand housing sector. Changing social, economic, technological and environmental issues affect the housing market and the ability of individuals to access housing. Immigration, demographic and lifestyle changes, changing household structures and the needs of different cultures influence housing demand and the supply of social housing.

New Zealand's population is projected to reach over 5 million by 2041. The projections reflect specific assumptions about birth and death rates and net levels of migration. Currently, 70 percent of migrants and refugees to New Zealand settle in the Auckland region. The region currently houses over 32 percent of New Zealand's population. These factors place pressure on housing providers to match demand and supply.

The population is ageing. This means more housing will need to be suitable for elderly residents. The number of people with disabilities is expected to increase substantially over the next 10 to 20 years. This affects the types of housing required and the modifications needed to improve housing access.

The structure of families and households continues to change. The proportion of one-parent families and couples without children is increasing. Changes in household structures have particular implications for state housing. In future, there will be comparatively less demand for the standard three-bedroom home and an increased demand for smaller homes to accommodate growing numbers of childless and elderly households.

The ethnic make-up of New Zealand is becoming more diverse, particularly in the Auckland region. Auckland is distinctive internationally for its mix of peoples, with over 180 different cultures living in the region. Projections show that by 2021 the percentage of New Zealanders identifying as Māori will grow to 17 percent, Pacific peoples to 9 percent and Asian peoples to 1313 percent. A large proportion of Māori and Pacific peoples are currently state housing tenants or applicants. Key trends show that Māori household tenancy in state housing increased from 21 percent to 28 percent between 1981 and 2001, with Pacific peoples increasing from 8 percent to 22 percent. These trends are expected to continue. The structure of families varies between different cultures and ethnicities. The types of housing required also vary.

Over 50 percent of the state housing portfolio was built before 1970 and needs significant investment to ensure it continues to meet the changing needs and demands of New Zealanders. These houses require significant, ongoing maintenance to meet the Corporation's national standards. Research shows that people increasingly expect their homes to be safe and healthy. This requires a balance between investment in new acquisitions and the maintenance and modernisation of an ageing portfolio.

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