Housing costs are rising faster than household incomes but people are also putting more emphasis on paying down their mortgages
Spending on housing is growing at a faster rate than incomes, according to the latest Household Economic Survey.
It showed that average household income rose 9.1% from $81,227 to $88,579 in the two years to June 2014, Statistics NZ said.
Over the same period average household spending on housing costs rose 11.1%, from $256 a week to $284.
"The increase in housing costs was largely due to higher mortgage and rent payments as well as an increase in property rates," Statistics NZ labour market and household manager Diane Ramsey said.
"A really interesting shift we've seen is that a bigger proportion of mortgage spending is going on repaying the principal rather than on covering interest payments," she said.
For people with a mortgage, the average weekly mortgage payment increased from $357 in the year ended June 2012 to $389 in 2014.
Average weekly rent payments rose from $273 to $290 over the same period.
8 Comments
All things we consume in terms of cost and imports are rising against our sustainable ability to fund by debt and exports.
The value of imported goods rose $525 million (12 percent) to $4.9 billion, compared with October 2013. The rise was across all three main broad economic categories, led by capital goods (including aircraft, helicopters, and goods vehicles).
The monthly trade balance for October was a deficit of $908 million (23 percent of exports). This is the largest October deficit since 2008. The trade balance for the year ended October 2014 was a deficit of $107 million, falling from a trade surplus of $1.8 billion for the August 2014 year. Read more
If we dont drop the OCR we wont have a productive sector for the financial sector to be parasites off anyway.
In a free market that so many right and libertarian wingers want, shouldnt ppl be free to borrow any amount they want even if its sends the Nation bankrupt?
Which in effect is what we have and are doing, all so some in the finance indusrty can get nice fat bonuses, you know it makes that much sense.
Just note however that I think China is a hollowed out mess waiting to implode anyway. So when we as a Nation default on our loans I cant see them bothering to send a gunboat to get it back, not a 2 way trip anyway.
regards
I read it differently.
If the weekly spend has gone from $256 to $284 per week.
Allowing for the ever present increase in rates
and the increase in insurance.
And for the semi-compulsory annual rise in some mortgage contracts.
That small rise would indicate a drop or stagnation in paydown rate (especially considering interest is higher this year vs last)
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