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Housing costs driving inflation
16 July 2015
Housing costs driving inflation
“The annual increase in the consumer price index (CPI)
would have been negative 0.4 percent instead of going up 0.3
percent if it hadn’t been for the 2.5 percent increase in
housing, energy and property costs,” says CTU Economist
Bill Rosenberg. “While petrol prices are on the rise again
and drove the 0.4 percent increase in CPI inflation for the
last three months, over the year it has been housing that
has driven the CPI.”
Housing costs went up 3.4 percent in Auckland and 3.0 percent in Canterbury during the year. Nationally, rents went up 2.3 percent and home ownership (newly built homes excluding land) 5.3 percent.
“This reinforces the need for action on housing in Auckland. However general price inflation remains low, and along with falling dairy prices and flattening rebuild activity in Canterbury means the Reserve Bank should continue to lower interest rates alongside specific policies to address house price inflation and speculation. But they cannot fix the housing problem: that requires more effective Government action to curb speculation, control demand from high immigration, and build more houses,” Rosenberg says.
ENDS
New Zealand Council of Trade Unions
Te Kauae Kaimahi
The New Zealand Council of Trade Unions Te Kauae Kaimahi brings together over 350,000 New Zealand union members in 40 affiliated unions. We are the united voice for working people and their families in New Zealand.
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