31 January 2017

Teacher shortages inevitable with rising house prices

Rising house prices are hitting teachers hard in the pocket, the Green Party said today.

New analysis by the Green Party shows that houses are “severely unaffordable” for many teachers in all but two regions of New Zealand (see table below). Most teachers are returning to the classroom this week following the summer break.

“National’s housing crisis is impacting many New Zealanders, including those who play a vital role in keeping our communities running, like teachers,” said Green Party Co-leader Metiria Turei.

“In Auckland, the median priced house is now more than 14 times an average teacher’s income. That means some teachers will have to choose between having the chance to buy their own home or the career they’ve trained for and are passionate about.

“With our growing population, we need more people to choose teaching as a profession, not fewer.

“We are already seeing the results of the Government’s housing failure, with some schools in Auckland unable to attract enough teachers to cater to the city’s growing population.

“What started as an Auckland problem is now spreading around the country as house prices continue to rise beyond what most teachers can afford.

“The Government needs to build thousands of affordable homes, offer some as rent-to-buy for low income people, and stop selling state homes.

“Houses should be for living in, not speculating on, so we need a capital gains tax (excluding the family home), we need to close the loopholes that speculators use like negative gearing, and we need to stop overseas investors from being able to outbid people who live here.

“The Government must bring the house price to income ratio back to a reasonable level carefully over several years, by using all the tools available,” Mrs Turei said.

House price to income ratio for primary and secondary teachers
A ratio over 5 is considered “severely unaffordable”.

Region Median house price Primary/intermediate school teacher Secondary school teacher
Northland $410,000 6.95 6.83
Auckland $840,000 14.24 14.00
Waikato/BOP $460,000 7.80 7.67
Hawke’s Bay $345,000 5.85 5.75
Manawatu/Wanganui $260,000 4.41 4.33
Taranaki $351,000 5.95 5.85
Wellington $530,175 8.99 8.84
Nelson/Marlborough $455,750 7.72 7.60
Canterbury/Westland $438,000 7.42 7.30
Central Otago Lakes $649,275 11.00 10.82
Otago $310,000 5.25 5.17
Southland $235,000 3.98 3.92
New Zealand Total $516,000 8.75 8.60

Calculated using REINZ house price data for December 2016 and the midpoint of teacher salary data listed on www.careers.govt.nz – $59,000 for a primary/intermediate teacher and $60,000 for a secondary teacher.

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