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Source: MIL-OSI Submissions

Construction costs, rents, and rates rise – 16 October 2018

The cost of running a household rose over the year to September 2018, Stats NZ said today.

Housing and household utilities increased 3.1 percent, with increases for construction, rents, rates and electricity. Insurance premiums also rose.

Nationally, local authority rates and payments increased 5.1 percent for the September 2018 year.

“Local authority rates increase in the September quarter each year,” prices senior manager Paul Pascoe said. “However, the rise this year is higher than the 4.2 percent average increase we have seen over the last five years.”

Prices for the purchase of new-built homes increased 4.1 percent in the September 2018 year. The largest increase was in the Rest of South Island (South Island excluding Canterbury), up 7.6 percent. Prices in the Rest of North Island (North Island excluding Auckland and Wellington) rose 6.6 percent over the period.

In Auckland, rising prices for building new homes have slowed recently, up 3.3 percent in the September 2018 year. This compares with an annual price increase of 8.1 percent in the June 2017 year. Over the last five years, the costs for building new homes have increased 37 percent in Auckland, compared with 29 percent across all New Zealand.

Rents increased 2.3 percent in the September 2018 year, down slightly from the 2.5 percent increase in the year to June 2018. The largest increase was in Wellington, which was up 3.8 percent for the September 2018 year and 0.7 percent in the September 2018 quarter. Rents in all regions saw smaller rises in the September 2018 quarter than they have in the last two quarters.

“The average quarterly rent rise reflects many tenants not having an increase, as well as those facing higher costs,” Mr Pascoe said.

Nationally, around 85 percent of properties surveyed had no price change in the September 2018 quarter.

Annual electricity prices rose 2.5 percent in the September 2018 year, after easing slightly in the September 2018 quarter, down 0.2 percent.

Insurance premiums for both dwelling and contents also contributed to the rising cost of running a household. Dwelling insurance was up 16 percent for the September 2018 year, while contents insurance was up 4.3 percent. Quarterly increases in insurance premiums reflect policies being renewed at different times of the year.

Video

View our Consumers price index: September 2018 quarter video.

For more information about these statistics:

MIL OSI