Ancestral whenua (land) generally has more than one owner meaning the land cannot be sold, on this basis Māori applying for home loans do not have the standard requirements for mortgage sercurity.
Through a partnership with Housing New Zealand and Kiwibank, the Crown attempted to offer a solution to this problem by becoming a guarantor of Kainga Whenua loans.
However, figures from Housing New Zealand show only four loans have been issued – with a total value of $650,440.
The Chief Advisor Māori for the corporation, Tamati Olsen, says it’s still early days for the product and it’s a positive step in the right direction.
Mr Olsen says two further loans have been approved, but have yet to go through the legal process.
Last September, the Auditor-General found problems with the scheme.
It said as the programme is currently designed, most people who can afford the loan cannot get it and most people who can get the loan cannot afford it.
When Kainga Whenua loans were launched, Housing Minister Phil Heatley said demand for the product was likely to be modest.
Source: Radio NZ