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The 2006 Census recorded a total of 1,651,542 dwellings in New Zealand, with 1,478,709 classified as occupied dwellings and 172,836 unoccupied dwellings. The majority of the occupied dwellings are classified as private, in that the dwelling is not usually available for public use. In the 2006 Census there were around 7,000 occupied non-private dwellings, with hotels/motels accounting for around half of the non-private occupied dwellings and institutions such as hospitals and prisons accounting for just under a quarter of non-private occupied dwellings. Empty dwellings accounted for almost two thirds of the total number of unoccupied dwellings.
Table 1: Dwelling occupancy status 2006 Census
| Number of dwellings | |
|---|---|
| A Occupied dwelling | |
| B Occupied private dwelling with resident(s) | 1,454,175 |
| Occupied private dwelling with no usual resident(s) | 17,751 |
| Total occupied private dwelling | 1,471,749 |
| C Occupied non-private dwelling | 6,693 |
| Total Occupied dwellings | 1,478,709 |
| D Unoccupied dwelling | |
| E Residents away | 49,122 |
| F Empty dwelling | 110,154 |
| G Dwelling under construction | 13,560 |
| Total | 1,651,542 |
A A dwelling is any building or structure, or part thereof, that is used (or intended to be used) for the purpose of human habitation. An occupied dwelling is occupied at midnight on the night of the census or at any time during the 12 hours following midnight on the night of the census.
B Private dwellings are not usually available for public use.
C Non-private dwellings are available for public use and include hotels and motels, prisons, hospitals, boarding houses, residential care facilities.
D Unoccupied at all times during the 12 hours following midnight on the night of the census, and suitable for habitation.
E Where occupants of a dwelling are known to be temporarily away and are not expected to return by noon on the day after the data collection.
F Where a dwelling clearly has no current occupants and new occupants are not expected to move in on or before the date of the date collection. Unoccupied dwellings being repaired or renovated are defined as empty dwellings. Unoccupied baches or holiday homes are also defined as empty dwellings.
G All houses, flats, groups or blocks of flats being built.
Table 2, below, shows how the home ownership
rate has changed during the past 25 years and table 3 provides the sector of
landlord for non-owner-occupied dwellings. In the 2006 Census, those households
living in a house owned by a trust in which they are a member are classified as
living in an owner-occupied house. Prior to the 2006 Census, some households in
this living arrangement were not captured as owner-occupiers. The Briggs
adjusted series in table 2 adjusts the pre-2006 Census home ownership rates to
more adequately capture those households living in homes owned by a trust in
which they are members, by classifying them as home owners. Around 50% of
owner-occupiers make mortgage payments.
|
1981 |
1986 |
1991 |
1996 |
2001 |
2006 |
|---|---|---|---|---|---|---|
New Zealand (% of homes owner-occupied) |
71.4 |
73.7 |
73.8 |
70.7 |
67.8 |
66.9 |
Briggs adjusted for trusts |
|
|
74.9 |
72.3 |
70.5 |
66.9 |
|
1996 |
2001 |
2006 |
|---|---|---|---|
Private Person, trust or business |
196,188 |
264,501 |
299,607 |
Local Authority or City Council |
14,781 |
14,118 |
11,004 |
Housing New Zealand Corporation |
52,688 |
52,500 |
49,419 |
Other state owned enterprise or government department |
8,370 |
6,432 |
6,165 |
Sources: Statistics NZ, DTZ
The Census data provided in table 3 is an undercount of the actual number of Housing New Zealand Corporation (HNZC) dwellings. HNZC owns around 67,000 dwellings, with the Census consistently under-reporting the actual number of HNZC dwellings.
Characteristics of landlords
Rising house prices have attracted investors into the housing market. In an analysis of Survey of Family Income and Employment (SOFIE) data, Scobie, Gibson and Le (2007) found that 15% of all households in New Zealand owned an investment property, including holiday homes, rental property, timeshares and overseas property. Scobie et al. found that around 12% of households in the 45-54 age groups owning investment properties, compared with 5% in the 25-34 and 65-74 age groups. Of those households that owned investment property, Scobie et al found around 50% owned two investment properties and around a third own one property. The ANZ Property Investors Survey (ANZ, 2007) shows that property investors tend to be higher income earners, with mean annual household income of property investors of $80,000-$90,000, with 37% having household income in excess of $100,000.
The National Landlord Survey (Centre for Research, Evaluation and Social Assessment, 2003) identified the following benefits as being identified by landlords:
The National Landlord Survey also found that over 20% of landlords had been landlords for less than a year and over 50% had been landlords for less than eight years.
A number of government interventions either
directly or indirectly provide financial support to home-owners, renters and
providers of private rental housing. The total value of government
interventions that relate to housing is around $7.5 billion p.a.
The tax system
Section 6.8 contains a more detailed discussion of the impact of the tax system on housing.
The benefit system
The Accommodation Supplement (AS) is a non-taxable benefit that provides assistance towards accommodation costs. A person does not have to be receiving a benefit to qualify for the AS. The AS can be used to pay the cost of rent or to make mortgage payments. In the year to June 2007, $877 million was paid to 250,000 people through the AS, up from $830 million in 2006.
The nominal total cost of the AS increased from $711 million in the June 2002 year to $877 million in the year to June 2007. Over the 2002 to 2007 period, the number of recipients fell from 258,000 to 250,000, with average payments increasing as housing costs increased and with more people receiving the maximum payment. The number of people receiving the maximum AS payment has increased from just over 40,000 people (around 16% of recipients) in 2002 to over 60,000 people (or 26% of recipients) in 2007. Around 80% of people receiving the maximum payment were renters.
Social housing assistance
Provision of social housing is made
through Income Related Rents funding to HNZC ($436 million in the year to June
2007) for 59,000 households and for housing at market rates for around 8,000
people.
Other small-scale programmes
Small-scale policy interventions to support households into home ownership are currently provided through programmes such as:
Additional supply of 1000 affordable houses per annum is possible as a result of the proposed Affordable Housing: Enabling Territorial Authorities Bill.
The boom in real house prices that began in 2002 is unprecedented in New Zealand’s recent history. Real house prices increased by close to 80% between March 2002 and March 2007, around the same increase as was recorded across the entire 1962–2002 period (see figure 2). While unprecedented in New Zealand’s experience, such an increase has been a feature of many developed economies over the past 10 years (figure 3).
|
Figure 2: Real house prices 
|
Figure 3: OECD real house prices 
|
|
Source: QVNZ, Statistics New Zealand |
Source: OECD[7] |
The boom in real house prices has occurred across all regions of New Zealand. This differs from the mid-1990s boom which was largely based in Auckland. The lift in prices since 2002 has affected all classes of dwellings, whether they are at the top end of the market or more modestly priced. Real prices increased first in Auckland. The rate of growth in other cities, where the level of prices is lower, did not begin to accelerate until 2003. While the percentage changes in real prices have been largest in Christchurch and Dunedin, where the price level is lower, the biggest increase in dollar terms has come in Auckland. The top end of the market, represented by the upper quartile real house price, increased first, edging up in 2002, while the lower end of the market remained relatively flat. This is illustrated by real price movements in Auckland in figure 5. Once prices in the lower end of the market did begin to rise they lifted sharply, with the lower quartile price generally increasing at a faster rate than the median and the upper quartile from 2003 to 2007.
|
Figure 4: Regional real house price changes 
|
Figure 5: Auckland real house prices by quartile 
|
|
Source: QVNZ, Statistics New Zealand |
Source: QVNZ, Statistics New Zealand |
|
Figure 6: Real price changes March 1990-March 2007
|
Figure 7: Real price changes March 2004-March 2007
|
|
Source: QVNZ, Statistics New Zealand |
Source: QVNZ, Statistics New Zealand |
The increases in house prices have generally been exceeded by increases in section prices, particularly during a period from the middle of 2003 until late in 2005, where section prices accelerated sharply. Grimes and Aitken (2006) attribute almost all of the increase in house prices between 1981 and 2004 to section prices. Section 7 contains a discussion of movements in land prices.
One feature of the boom in house prices is that it has not been associated with sharp increases in rent, in part due to the large increase in the availability of rental properties; there have been smaller increases in rents than have been recorded in the United Kingdom. This may reflect a smaller increase in the occupied dwelling stock relative to population growth in the United Kingdom. The Consumers Price Index (CPI) is the official measure of changes in rent, and tries to control for changes in the composition and quality of rental accommodation.
|
Figure 8: Rent price component of CPI 
|
Figure 9: Real income by percentile 
|
|
Sources: Statistics New Zealand, Datastream |
Source: Ministry of Social Development |
4.5 Real income growth has been uneven across the income distribution
Comparable data is not available for the period from 2004 to 2007. New Zealand Income Survey data shows that from 2004 to 2007 the upper band of the level of real income of the lowest 20% of income earners (individuals rather than households) has increased by 9.2% (or $15 a week in 2007 dollars), while the lower band of the income of the highest 20% of earners has increased 11% (or $80 a week). The introduction of the Working for Families package has contributed to the increases at the lower part of the income distribution since 2004.
[7] The OCED average is not weighted for the size of the housing stock in each country and does not include prices in Turkey, Luxemburg, Mexico, Poland, Czech Republic, Slovenia, Hungary, Greece and Iceland.
