Rising rents hit beneficiary budgets the most
Beneficiary households were most affected by rising rent prices in the June 2019 quarter, Stats NZ said today.
For beneficiary households, rents were up 1.2 percent for the quarter and 2.9 percent for the year. Be-cause this group spends a much larger proportion of their money on rent than the average household, the impact is larger.
“Rent makes up approximately a third of household expenditure for beneficiary households, compared with around a tenth for all households,” consumer prices manager Gael Price said.
“Therefore, the strong rent rises this quarter affected beneficiaries more than any other household group.”
“There are potentially several factors contributing to the rising rent prices,” Ms Price said.
“These factors include strong demand for rentals, as well as landlords passing on to renters increasing costs such as rising insurance premiums.”
Rent prices were up 1.1 percent for the quarter and 2.7 percent for the year for all households.
Dwelling insurance and contents insurance prices were both up this quarter and have been rising strongly for the last few years. Both of these impacted on superannuitant households the most, and beneficiary households least. Superannuitant households are more likely to own their own homes, while beneficiary households are more commonly renters.
Overall inflation for beneficiary households in the June 2019 quarter was up 0.7 percent, about the same as the lowest-spending households (also up 0.7 percent).
By comparison, prices for both Māori and superannuitant households rose 0.6 percent.
Highest-spending households’ inflation more subdued
Inflation for the highest spending households was the lowest, at 0.3 percent for the quarter.
The biggest contributor to inflation for this group was petrol.
The petrol price rise was partly offset by mortgage interest payments which fell this quarter. This is the fourth quarterly fall in a row.
Seasonal falls for domestic airfares and domestic accommodation also helped keep inflation low for the highest expenditure group.
Inflation highest for lowest-spending households over the last decade
Living costs have
increased the most for lowest spending households over the
last decade. The living costs for this group increased 22
percent, compared with 17 percent for all households.
Highest spend-ing households saw price increases of 14