Source: Consumer NZ
Research by Consumer NZ from July 2024 has found 60% of non-property owners feel buying a house is not within their reach. This comes as a report published by Deloitte this month found home ownership in New Zealand has dropped below 60%, the lowest since 1945.
Gemma Rasmussen, head of research and advocacy at Consumer NZ, says there are concerning consumer impacts to dwindling home ownership in Aotearoa.
“Our nationally representative research found that 41% of non-homeowners said they are completely locked out, while 19% said they were saving for a deposit, but couldn’t keep pace with the market. We estimate that 1 million New Zealanders feel that renting is their only option,” Rasmussen says.
“Those living in Nelson and the Bay of Plenty feel most locked out of the property market, while those aged 40-49 are most likely to have lost hope about ever purchasing a property.”
“There are a range of factors that have contributed to dwindling home ownership prospects. A housing price boom post-Covid saw many snap up housing due to low interest rates and a great return on investment. Couple that with a low housing stock, followed by inflation and climbing mortgage interest rates, and we’re looking at the largest deterioration of housing affordability in Aotearoa in decades,” Rasmussen says.
“Unfortunately, we may not be feeling much respite with rising insurance costs due to weather volatility, rising energy costs and increasing council property rates bumping up house values. This leaves us with property landing in the hands of fewer people across the country, diminishing the age-old concept of homeownership as a rite of passage.”
When renting is your only option
Rasmussen says renters are facing a lot of instability. Out of the renters surveyed, 65% said they’ve been living in their rental for 4 years or less.
“The transient nature of renting isn’t great for families who might be enrolling their kids in a local school, or for older New Zealanders who have limited incomes. Each move can contribute to feelings of instability and vulnerability,” Rasmussen says.
Rental standards are also cause for concern with approximately one-third of renters experiencing a problem with dampness and mould, while 21% said they cannot afford to adequately heat their home.
“With a large and potentially growing number of renters it’s important that our tenancy laws provide proper protection for tenants. All New Zealanders deserve to live in a healthy and safe home and have some certainty over their future.”
Notes:
Consumer NZ research of 1000 New Zealanders comes from its quarterly, nationally representative research, July 2024
Population estimate based on Stats NZ data, 2024 Q1
Deloitte Report, commissioned by Westpac, July 2024
