Up to 1,000 Wellington social housing tenants could benefit from an $8.54 million support package designed to prevent major housing upgrades from becoming a financial shock for people already managing tight household budgets.
Te Toi Mahana, Wellington’s largest residential landlord and a leading provider of affordable housing, is committing its $8.54 million Existing Tenant Support Fund to rental assistance for former Wellington City Council tenants who cannot access the Government’s Income Related Rent Subsidy.
Communications lead Seb Bishop joins Radio Waatea to discuss how the package will work, why the organisation believes gradual rent adjustments are necessary and what it could mean for tenants trying to remain securely housed.
Te Toi Mahana manages approximately 2,000 properties providing homes to almost 3,000 tenants across the capital.
Upgrades shouldn’t create a rent shock
At the heart of the initiative is Wellington City Council’s Housing Upgrade Programme Phase 2, known as HUP2.
The programme will upgrade 825 social housing properties across 213 buildings over the coming decade, with the aim of delivering warmer, drier, safer and more secure homes.
But there is a catch.
As properties are improved, their assessed market rents can increase.
Former council tenants already receive rents discounted according to their circumstances, averaging around 30 percent below market rent, but an increase in the underlying value of an upgraded property can still flow through to what tenants ultimately pay.
Te Toi Mahana’s fund is designed to prevent that increase arriving all at once.
Five years to adjust
Under the scheme, Wellington City Council provides assistance while tenants are temporarily relocated for upgrades and during the first year after returning to their improved homes.
Te Toi Mahana will then step in for another five years.
In the first year following the end of council support, the HUP2-related rent increase will be 100 percent subsidised. That assistance reduces to 80 percent in year two, 60 percent in year three, 40 percent in year four and 20 percent in year five.
If an upgrade would otherwise result in an additional $70 a week in rent, for example, that increase would initially be fully covered before being progressively introduced.
The intention is straightforward: improving someone’s home should not simultaneously put them at greater risk of being unable to afford it.
Protecting older tenants
The $8.54 million fund will also protect some of Wellington’s oldest social housing tenants.
Te Toi Mahana inherited an Over-80s Rent Freeze from Wellington City Council, under which eligible tenants have their rent frozen for the remainder of their tenancy.
That policy is being phased out for future entrants, but existing recipients will retain their protection.
Tenants aged 75 or older on 6 November 2026 will also remain eligible for the rent freeze once they turn 80. After that group moves through the scheme, it will close to new entrants, with Te Toi Mahana intending to target future assistance according to individual financial circumstances rather than age alone.
Support shaped by tenants
The package was developed following engagement with tenants through community meetings, focus groups and an income survey completed by 220 tenants.
Te Toi Mahana says that information was used to model how assistance could be targeted without inadvertently reducing people’s eligibility for other financial support.
That is particularly important for social housing tenants because household finances can involve multiple forms of assistance, including accommodation support and rental subsidies.
A poorly designed change in one area can sometimes have consequences elsewhere.
Housing security is about more than bricks and mortar
For Māori whānau, kaumātua and low-income households, the wider issue is housing security.
A warm and dry home undoubtedly matters.
But so does being able to afford to remain in it.
Housing instability can flow into almost every other part of whānau wellbeing — health, education, employment, financial security and the ability of children to remain connected with their kura and community.
That makes the Te Toi Mahana initiative significant beyond Wellington’s housing portfolio.
It poses a wider question for social housing providers and governments undertaking major housing upgrades: how do you improve the quality of a person’s home without pricing the existing tenant out of it?
Where the $8.54 million came from
The Existing Tenant Support Fund originally contained $7.42 million when it was transferred from Wellington City Council to Te Toi Mahana in 2023.
The money originated from Better Off Funding provided to the council by the Department of Internal Affairs in 2022.
The fund was ring-fenced to provide rent relief and cost-of-living assistance to former council tenants unable to access the Income Related Rent Subsidy. After accruing interest, its balance had reached $8.54 million by August 2026.
The bigger test is keeping people housed
Te Toi Mahana has broader ambitions for Wellington housing, including a goal of owning and managing an additional 500 affordable homes over the next decade. It has also been selected as one of the Government’s preferred delivery partners for the Housing Flexible Fund.
But for existing tenants, the immediate priority is considerably simpler.
It is certainty.
At a time when rent, kai, power, transport and other household costs continue putting pressure on low-income families, a sudden increase in housing costs can be the difference between coping and falling into deeper hardship.
The $8.54 million package recognises a basic principle of social housing: success isn’t simply measured by how many homes are upgraded. It is also measured by whether the people those homes were built for can still afford to live in them when the work is finished.
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