Similar decade rises for household income, cost of housing

This could be relevant to other discussions – household income and the cost of housing have both risen by just over forty percent over the last ten years.

Department of Statistics: Household incomes up over 40 percent from 2008

The average annual household income has risen 41 percent since 2008, up more than twice the rate of inflation, Stats NZ said today.

Over the same period, average annual housing costs increased 43 percent.

“Although average household income grew 41 percent over the last decade, individual households experienced this growth differently,” labour market and household statistics senior manager Jason Attewell said. “While income for the poorest tenth of households grew 29 percent, for the richest tenth, income grew 47 percent.”

From 2008, the average annual household income rose just over $30,000 (41 percent), to reach $105,719 (before tax) in 2018. Over the same period, average annual housing costs increased 43 percent, from $11,967 to $17,122, according to the latest household income and housing-cost statistics. Inflation as measured by the consumers price index increased 17 percent over the same period.

Household income includes any income from wages and salaries, self-employment, investments, government benefits, and superannuation. Housing costs include rent and mortgages, property rates, and building-related insurance.

Housing costs to income ratio remains unchanged from 2008

For the year ended June 2018, households spent an average of $16.30 of every $100 of their household income on housing costs. This is relatively unchanged from the $16 they spent a decade ago.

“Although the ratio of housing costs to household income hasn’t changed significantly over the last decade, certain types of households, such as renters and poorer households, pay a higher proportion of housing costs,” Mr Attewell said.

For the year ended June 2018, 1 in 5 (21 percent) of renting households spent 40 percent or more of their household income on housing costs, including rent. This compared with 7.5 percent of homeowners who spent that much of their household income on housing costs, including mortgages.

“The ratio of housing costs to household income is an important measure, because a high proportion of housing costs is often associated with financial strain, particularly for lower-income households,” Mr Attewell said.

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6 Comments

  1. Kitty Catkin

     /  October 30, 2018

    In a book that I have, written in 1870, the writer calculates that the total rent of the slum house the main characters live in (where families live in one room) costs as much ‘area for area’ as a house in one of London’s most expensive streets. I can well believe it.

    Reply
  2. Blazer

     /  October 30, 2018

    right here is the main factor that destroys the proposition…

    ‘The average annual household income has risen 41 percent since 2008, up more than twice the rate of inflation, Stats NZ said today’

    the inflation rate conveniently EXCLUDES property inflation…for an obvious reason.
    Anyone need a …SLEDGEHAMMER?

    Reply
  3. PartisanZ

     /  October 30, 2018

    Damned lies and statistics eh? What a load of friggin’ codswallop!

    A 29% increase in a low income is a very different thing from a 47% increase in a high income …

    And a headline ‘Housing costs to income ratio remains unchanged since 2008’ doesn’t mean a fucken damned thing – and is rather like fake news – if it doesn’t describe or even allude to the significant CHANGES Mr Attewell then goes on to chronicle.

    Plus tautoko what Blazer says …

    Codswallop of the highest order from a politicized government department?

    Reply
    • PartisanZ

       /  October 30, 2018

      make that “lowest order” …

      Reply
    • Alan Wilkinson

       /  October 30, 2018

      It doesn’t give comparative statistics to show whether or not the poorer deciles are paying a higher proportion of their income on housing than they were in 2008. At least not in the quoted text above.

      Reply
  4. Blazer

     /  October 31, 2018

    the % of household income to mortgage ratio used to be set by financiers at no more than 30%.
    These days its more like 50% and that includes renters.

    Reply

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