Prime Minister John Key discussed the strong New Zealand dollar, sales of state homes to tenants and being addressed by his first name while talking to reporters during his visit to the Christchurch suburb of Bromley, where he officially opened the Rylock factory.

More tenants are expected to buy their state-provided homes under new policies to encourage first home buyers, but the Government is denying it has plans to significantly ramp up sales to those renting from the state.



Wellington property investor Sir Bob Jones has urged the Government to sell Housing NZ homes to tenants by offering them low non-transferable mortgages, rather than trying to sell them to social housing providers.

The Salvation Army recently backed away from buying any of the 1000-2000 properties the Government aims to sell this year as it moves to boost the non-government social housing sector and reduce Housing NZ's stock.

Jones said selling them to tenants, as the 1949 National Government did, would have wider benefits including lowering crime, breaking the cycle of dependency, boosting personal responsibility and even lifting the number of people who voted.

"The OECD studies say more than anything else home ownership changes attitudes. They own their own home, they take a different view on the world."

In a recent opinion piece Jones said he had raised the issue with Housing NZ Minister Bill English who had said the Government was exploring something along the same lines.

Labour housing spokesman Phil Twyford said with the Salvation Army and the Methodist Mission saying they did not want to buy state houses it seemed English was now thinking about a mass sell-off to tenants.

But English on Tuesday said no new policies were planned and Jones was "overreading" what he had said, which was "we are doing something along the same lines". Both Jones and Twyford seemed not to realise there were already policies in place to sell houses to state renters.

Under the First Home ownership scheme, open to tenants and the general public, 180 houses had been sold since 2013. To help with the deposit, eligible buyers receive a grant of 10 per cent of the purchase price of the property, capped at $20,000.

A second scheme, aimed only at tenants, had seen 30 houses sold each year since 2009.

English said no policy changes were planned but he expected more state houses would be sold to tenants as reviewable tenancies continued and the new Homestart package made it easier for first home buyers.

Also the Ministry of Social Development would soon set out its purchasing strategy and that would make it clearer to Housing NZ that it had significant numbers of houses where the Government would not pay an income related rent subsidy "forever".

There would not be a dramatic change but Housing NZ had too many three bedroom houses and they had limited choices of what to do with them. So there might be "a bit more incentive on Housing NZ to push the option" of selling.

English said while some people had argued houses should be sold only to tenants, not to community housing providers, "we just don't think there's anything like enough of them who are in a state where they could participate in that".

Prime Minister John Key said the overwhelming bulk of state house tenants did not want to buy their property and the Government did not particularly want to sell those properties, although over the last few years some had been sold.

"If you think about the 68-odd-thousand state house we have about 6000 have market-related rents as opposed to income-related rents. Those who are paying market rents are generally in a better position to support a mortgage if they were to borrow against their home."

But Jones said tenants could afford to buy and the Government should "sell the lot". It could transfer the rent into a low-cost mortgage payment, but the new owners would be up for the rates and insurance.

"They'll find it, My parents did. We were all living on the bones of our bum."

In time they could start paying some principal back.