Hundreds of state houses in New Zealand were sold below the valuation of the government, prompting warnings of lower local values. The Labour party claims that Housing New Zealand “lost” at least $13 million on the sales.

The figures gathered by Labour revealed that 443 state houses were sold in 2014, at an average of 13.3 percent below the Government Valuation. Labour said total proceeds from sales where valuations were available raising $71.8 million compared to $84.9 million valuation for the houses.

“Much of the public debate has been around proposals to sell off large numbers of state houses but already Housing New Zealand is moving large numbers of state houses,” said Phil Twyford, the housing spokesperson for Labour. The sales of state houses were mainly done in regional areas including Auckland and other growth areas in the North Island.

Housing NZ has admitted a major shortage in those areas. In Gisborne, houses were sold at an average of 22 percent below Government Valuation while those in Waikato were 30 percent below, reports Stuff. Twyford said they appear to be systematically selling the houses below their council valuations.

Labour’s housing spokesperson believes that in some cases, the sale below valuation has increased risk while reducing the property values of local homeowners. Bryony Hilles, a spokesperson for Housing New Zealand, said the organisation “regularly buys and sells properties” as part of its usual activity.

The sales were generally conducted on the open market. Some were sold at a lower value because units were being disposed for removal while some houses were damaged by fire or subsidence.

Hilless said Housing NZ’s policy is to sell high value properties to reinvest the proceeds to housing for those most in need. In 2014, five state houses were sold more than $1 million, including a $1.36 million sale of a property in Devonport, which is about 5 percent less than the Government Valuation of the property.

Nearly a quarter of the sales in 2014 were part of the special Housing NZ programmes. Under the FirstHome scheme, first time buyers are entitled up to $20,000 or 10 percent of the purchase price towards a deposit.

Meanwhile, Labour has found that families in urgent need of a state house are now waiting twice as long compared to 18 months ago, reports the New Zealand Herald. Carmel Sepuloni, Labour’s Social Development spokesperson, said the data highlighted the struggles of those who have nowhere else to go.

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