Home Ownership Lower in Auckland

Auckland Mayor Dick Hubbard said that immigration was one of the main reasons why it will continue to get more expensive and difficult to own a home in Auckland, New Zealand’s largest city.

Mr Hubbard’s remarks came after a report, released yesterday, for the Centre for Housing Research which found that Auckland’s home ownership rates were already significantly below the rest of the country and continuing to decline. The report predicted that home ownership in Auckland would fall to 58.3 per cent by 2016 and house prices would continue to rise.

Mr Hubbard said the new report ignored the high growth of the region, which took 70 per cent of all new immigrants.

“If you had less growth in Auckland, if you had less immigration in Auckland, prices would fall, it’s as simple as that,” he told Radio New Zealand. “The report totally ignores that side of things. If you’ve got 50,000 new people a year arriving in Auckland City, you’re providing 50,000 or 60,000 new houses, that is going to keep a lot of pressure on the market.”

Manukau City Council Mayor Sir Barry Curtis said government help would be needed to make a significant difference. “The cost of housing in New Zealand has got out of all proportion. It’s not just the cost of building, the cost of building materials, but it’s also the cost of land. The cost of land has skyrocketed over the last 10 years.”

Yesterday’s report said an extra 56,000 rental units would be required over the next decade to provide for those who would be unable to buy their own home.

The difficulty Auckland households faced in buying a house was likely to increase the gap between socio-economic groups, and had implications for community stability and wealth accumulation, the report’s authors said.

Overall, New Zealand home ownership peaked at 73.8 percent in 1991 but has since fallen to 65 percent and was expected to sink to 61.8 percent by 2016.

The report’s authors recommended that the government focus on addressing the lack of affordable and secure accommodation for poorer households.