Wages not keeping up with house prices

With wages rising just 0.3 percent in the three months to March 2015 but average Auckland house prices rising 6.1 percent in the same timeframe, urgent action is needed to ensure working New Zealanders can achieve home ownership, the Green Party said today.

“Young New Zealanders see the growing gap between their wages and house prices and despair that the National Government is ignoring their hopes to one day own their own home,” said Green Party housing spokesperson Kevin Hague.

“No matter how hard people save, with such a huge difference between low wage growth and dramatic house price rises, many working New Zealanders are being forced to give up on the idea of home ownership because of the Government’s inaction.

“The simple fact is that a house in Auckland earns more than a working person does.

“Median Auckland house prices rose 9 percent over the year from March 2014 to March 2015, but the Labour Cost Index shows wages only rose 1.7 percent over that time.

“Most New Zealanders are not seeing their pay packets get any bigger. Only 11 percent of wages have increased in the first quarter of 2015.

“The Green Party has a comprehensive plan to address the Auckland housing crisis including a capital gains tax on investment properties, a major state-led home building programme with progressive rent-to-buy options, restrictions on sales to investors from overseas, and more high-quality medium density housing to meet demand.

“If the National Government really cares about fixing the Auckland housing crisis it will announce major initiatives in the Budget later this month. If it doesn’t, New Zealanders who aspire to home ownership will know that National has run out of ideas,” said Mr Hague.

 

Barfoot and Thompson’s Market Updates show a 6.1% rise in median Auckland house prices in the first quarter of 2015.

The Statistics New Zealand Labour Cost Index, released today, shows a 0.3% in rise in salary and wage rates in the March 2015 quarter and a 1.7% rise in the year to March 2015.

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