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Statistics on Housing Affordability

This report makes available time series data relating to housing affordability in New Zealand. The provision of this data meets a primary objective of Statistics New Zealand's Housing Statistics Strategy: To improve user knowledge and accessibility to available data. Data sources used for this report are Statistics New Zealand's Household Economic Survey (HES) and the Ministry of Social Development's Accommodation Supplement (AS) administrative data.

Housing affordability includes the capacity of households to meet ongoing housing costs and the amount of discretionary income available after housing costs are paid for. There is no single measure for housing affordability. Depending on how affordability is measured, the characteristics of households' housing needs will vary. For this reason, more than one measure is presented in this report. The key factors that influence housing affordability for any household include housing costs ('entry' and ongoing), household composition, the number of people in the household, household income, geographic location, housing quality, and the current housing market.

There are two aspects to housing costs: entry costs such as house prices, deposits and bonds; and ongoing costs such as loan/mortgage repayments, rent, maintenance and rates.

The statistics in this report concentrate on the ongoing costs aspect of housing affordability.

The measures used are:

  • Crowding index (Canadian National Occupancy Standard)
  • Equivalised household residual income
  • Housing cost to income ratio
  • Accommodation Supplement recipients (2002–04).

The housing cost to income ratio, equivalised household residual income and crowding index have been derived using HES data for 1984–2004. These measures are further broken down by household characteristics that include tenure type, sector of landlord, and household ethnicity, composition and income level. For residual income and crowding, income figures have been equivalised in order to allow comparison across various household sizes and types.

The commentary in this report is generally limited to trend highlights. Any of these statistics need to be viewed in the context of the political, social and economic changes that have taken place over the last 15–20 years. Significant among these are:

  • benefit reductions in 1991
  • full introduction of market related rents in 1991
  • corporatisation and restructuring of Housing New Zealand and the reduction in public rental stock between 1994 and 1997
  • introduction of the Accommodation Supplement in July 1993
  • reintroduction of income related rents for Housing New Zealand Corporation tenants in 2000
  • unemployment rate change from around 10 percent in 1993 to around 4 percent in 2004
  • increasing demand for housing by immigrants.


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