A quarter of arrivals to New Zealand in the five months to January 2021 planned to return overseas if the COVID-19 situation improved, according to a Ministry of Business, Innovation and Employment (MBIE) survey.
MBIE surveyed 5,041 of the 31,508 people who arrived in New Zealand between August 2020 and January 2021.
Seventy-two percent were New Zealand citizens and 16% New Zealand residents.
Just over a third returned for family reasons. Another third returned because they always planned to come home at that time, and just below a third came home sooner than intended.
A significant portion - 38% had been living overseas for more than five years, meanwhile 30% had been living abroad for one to five years and 19% less than a year.
The survey results don’t provide definitive results around the extent to which returnees joined the mob of people who bought residential property towards the end of last year.
Twenty-one percent of returnees moved into a place they owned or partly owned, technically leaving some of the remaining 79% in a position to buy a house to live in.
However, 79% of those surveyed agreed or strongly agreed with the statement, “My living situation is suitable for my needs”.
Seventy-two percent of returnees were 30 or older, and thus arguably more likely to be able to afford to buy a house than the 27% of arrivals who were under 30.
As for employment, 65% were employed. Of these people, 13% were continuing to work for in an offshore role from New Zealand.
Around a fifth of those surveyed believed they would need financial or government support in the next six months.
Eighty-three percent of returnees had a tertiary-level qualification - the vast majority of these at bachelor’s level or above.
The most common industry returnees intended to work in was health care and social assistance (16%) followed by professional, scientific and technical services (11%) and education and training (8%).
MBIE said Statistics New Zealand border arrival data had been used to weight the survey to represent the 31,508 arrivals between August 1, 2020 and January 9, 2021.
It plans to publish results for arrivals between January and April 2021 when the data becomes available.
See a two-page spread of the results here.
56 Comments
I wonder how many are in motels/mum and dads place/camper cars.
A large percentage will leave again once they see better options unless you are super cashed up NZ is now very expensive.
We have had people moving to regions to find cheaper homes which are now all priced at what Auckland was approx 10 years ago so now I guess many will look to cross the ditch and invade smaller towns where you can buy a very nice property for sub 500k which is a major problem for NZ if they are good workers with families.
Energy costs are soaring and businesses are also expected to pay higher wages to cover sky-high accommodation costs, not skill premium.
We could see the pace of de-industrialisation in NZ pick up even further.
On the flip side, the government will simply issue record number of visas and keep the economy running on low-value businesses.
Look at the top 10 occupations. Those in healthcare, software and executive management can easily afford to buy in Auckland (if they want to). 13%, not an insignificant number, are also continuing to earn their higher foreign wages. Some may stay, some may leave, but I very much doubt many will be in hardship or be rushing to small town Australia to buy $500k houses when they earn that much in a year.
$500K will buy you a 4 bedroom and 2 bathroom house on a 600sqm block in Perth- which is hardly a small town at 2.2 Million people. They also need nurses and doctors, IT workers and executive management- and given they are a mining town that is literally booming - I suspect they are willing to pay a lot more in salaries than Auckland.
The original post said "will look to cross the ditch and invade smaller towns". I agree that Perth is not a smaller town, but I would also add that anything decent will be north of $1m now.
I have a family member who works for a global software company where she provides IT services to companies in Perth. She is on Australian wages and works from home in Auckland. You don't need to live in Australia to earn Australian salaries and she would never live in Perth permanently (Melbourne or Sydney maybe, but never Perth). Similarly, another family member recently completed their dentistry degree in Perth and returned to... Auckland.
Ah No - the houses are not more than $1 Million in Perth unless your living in the leafy green suburbs of South Perth, Applecross or Peppermint Grove - which are very similar to Oriental Bay and Remuera and even if you are living in those suburbs the house prices are only just over $1 Million not $2,3 or 4 Million like they are in NZ
Below is the latest house prices in WA as of the 31st March and it clearly shows the average median house price is $500K. Even if they rose 25% this year that still makes the average house price less than $650K
I’m not assuming. I work in that space and a lot of the people who have returned aren’t help desk types. We’re talking enterprise software and there’s some seriously talented people who have returned. Whether they stay or go, buy or rent, will be an interesting question. But they are earning incredible $ right now.
You don't need to be in small town Australia to buy a $500k house. You can buy a brand new home for under that in Melbourne - sure, you might not be in the inner city suburbs but somewhere like Pakenham, Tarneit or Sunbury - but its still Melbourne.
https://www.realestate.com.au/property-house-vic-tarneit-136166562
People seem to be under the mistaken impression that all houses in Melbourne and Sydney are $1M+ when the reality is that there are plenty of cheap houses still being built in the new subdivisions on the edge of both of these cities.
Lets get real.. house price increases at outrageous levels are happening all over the "developed" world. Aussie, US and UK house prices are rising just as fast if not quicker. Regions in AU just like in NZ have increased 40+ % in some places. And BTW.... you may think its "cheaper" for some things in AU. But remember.. you pay more income tax there, more taxes and levies for health.. and you also pay STAMP DUTY (10's of 1000's) in addition to the final price of the house you buy. Oh.. and remember.. there is a hefty CAPITAL GAINS TAX. SO my message here is.. its not always grass is greener... its just different, and you make your own way to your own set of circumstances and goals.
... and in Aussie, you would earn a shitload more, which is the point. In NZ, your middle class profession has been going backwards against food and housing costs for years AND it's likely on a regional skilled shortage list, meaning wages are not only dropping in real terms, but unlikely to rise in nominal terms.
90% of the people who insist it's about "how hard you work" or "have to make the most of it" are just looking for a way to avoid admitting how lucky they were to get their start when they did, and how much harder it is now for anyone starting out from where they did, and the other 10% might at some point acknowledge the cold hard reality of things like objective stats showing increases in house prices as a multiple of yearly earnings, but only reluctantly.
Excellent read. I think it makes clear an important point which older Kiwis sometimes don't realize - if you're a millennial or younger, it's been true for your entire adult life that there has been an affordability problem, which numerous politicians of all stripes have repeatedly accepted but refused to do something about.
My experience of renting was a nightmare too - finding a place to rent has, for people my age, always been extremely difficult and expensive. So we have a generation barrelling towards their forties now for whom anything to do with housing has always been an expensive, stressful nightmare. And a generation coming up behind for whom its even worse.
I know when I lived in Sydney that while my rent was higher, my salary far outweighed it and most other things were cheaper and I was able to save a whole lot more and I recommend this as a way for young people to save for a deposit. Tax isn't normally higher as the first $18,200 is tax free, you only pay more when at much higher salaries.
Also if you are a Kiwi who arrived after 2001 and doesn't have a Aus resident spouse, you don't have to pay capital gain tax as long as you stay on the SCV visa (not many know this but it's true).
If you want to have a family there with a house it's best to live in a wide variety of other more affordable places where incomes are still much better than here.
Yes, at normal salaries income tax is lower in Australia. 50K AUD has income tax of just $6717 which is about 13.4%. Compare that to NZ, where 50K AUD is about 53500 NZD which would result in 9070 NZD income tax which is 16.94%. The rates get closer at 100K income, but is still slightly lower in Aus.
Of course there are things like medicare and ACC levies to take into account, but the overall point is that income tax in Australia isn't much higher (if at all) than in NZ unless you are a very high earner.
That tax advantage also includes all foreign earned income, so in effect you can earn tax free foreign investment earnings along with tax free capital gains on investments (note that doesn't include "Real Australian" property such as investment property, which remains subject to CGT)
I go the tax ruling as well, which annoys the hell out of many aussies as it puts us unprotected SCV (i.e temporary residents) in a far better tax position than their own citizens/permanent residents.
Definitely worth getting good tax advice or even a private ATO ruling, if you plan to cease declaring CG and foreign income
It's a bit worse here, but also staggering in those countries, e.g.
https://www.theguardian.com/australia-news/2021/jun/10/house-prices-in-…
Only being beaten by that pesky Turkey, but they have got 16% general inflation, so that’s cheating a bit.
https://fortune.com/2021/06/03/global-real-estate-markets-highest-house…
https://i.stuff.co.nz/life-style/homed/real-estate/125348365/nz-number-…
There is no capital gains tax on your principal place of residence, and unlike NZ now, you can rent that place out for up to 6 years without it incurring capital gains tax. And any capital gains tax is discounted by 50% unlike the NZ Brightline Tax. Stamp duty is often waived or lowered for First Home Buyers, and there are First Home Buyer grants that New Zealanders are eligible for. Income tax is higher, but unlike NZ you can deduct a whole heap of expenses or salary package things like cars, restaurants, technology etc. If you want to buy investment property you can do so with a self-managed super fund and obtain all the tax advantages of the Super regime. Negative gearing is still allowed in Australia. Unlike NZ when the 10 year Brightline now applies to your family home, there is no discount for holding a property longer than a year, and you can't even deduct interest in on it anymore let alone claim rental losses against other income. Financially, you would be nuts to think that paying less income tax in NZ is a reason to stay here.
So we have a huge number of returning accountants, we are still producing graduate accountants, yet accountants and financial managers are on the regional skilled shortage list.
When are people going to wake-up to how the arguments around migration in this country are ripping them off - "high value" migration is an attack on the earning ability of the middle class. It's not all fruit pickers and ethnic chefs and it never was.
"high value" migration is an attack on the earning ability of the middle class
Many migrant accountants bring years of experience from their home country but not the soft skills or market knowledge to provide business inputs beyond the traditional bookkeeping role.
As a result, these pre-trained migrants end up giving local grads a run for their money on the handful of entry-level roles.
Not that it will stop the outflow but all the same issues afflicting NZ are present in Australia, though perhaps not to the same degree.
e.g....
https://www.carevision.com/the-biggest-challenges-in-australias-aged-ca…
https://www.researchgate.net/publication/303742329_Foreign-born_aged_ca…
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