"It's a relief the judicial process is now over [because] politicians have been cowering behind sub judice."
The Queenstown trust is an independent non-profit organisation created in October 2006 to manage and deliver affordable housing to those who cannot afford it otherwise.
In August last year, the Charities Commission informed that it would be deregistered from September because the commission did not consider the trust's activities met its guidelines, meaning the trust it would lose taxation and gift duty benefits.
However, in October, the trust was given a reprieve by order of the High Court at Wellington until the hearing, with the final decision released on Friday.
Mr Cole said the decision would have an effect on all community housing providers across the country.
"If you have a look at the judgement, what the judge is saying is that if you help individual householders, there's no community benefit.
"One of the tests under the Charities Act is, 'Is it providing community benefit?' We have case law, as of Friday, which says it fails to meet that test."
Another test was that of "poverty", with reference to "helplessness" in the decision.
"If that's the benchmark, then there's a whole raft of community housing organisations throughout New Zealand that are trying to provide assistance for those who are not 'desperate' but who can't afford to get into any reasonable accommodation - rental or purchase."
The housing trust has until mid-July for the deregistration to take effect, with trustees to meet in the next week to discuss whether to appeal the decision.
He told the Queenstown Lakes District Council yesterday the decision was "a failure of the Charities Act, not a failure on the part of the trust".
The council's original Hope (Housing Our People in our Environment) Strategy was backed by the government, with a Memorandum of Understanding between Housing New Zealand and the council.
The trust deed and the form the entity should take were reviewed by Housing New Zealand and independently reviewed by Deloittes.
The trust's activities were further endorsed by a $2 million grant in 2008 to "kick the programme off".
"As recently as three weeks ago, I had a call from the minister [of Housing Phil Heatley] to confirm $700,000 support for our new Rent Saver programme.
"We have had the Crown here backing us, backing all our initiatives, and at the same time another Crown agency working against our interests."
The risk from the decision was a "domino effect" across other housing trusts trying to make a difference in their communities.
"There are many successful housing organisations around the country and I don't see how any of them is now safe," Mr Cole said.
