Queenstown housing affordability worst in New Zealand

March 2013

While housing affordability receives national prominence, the severity of the problem is most apparent in Queenstown where median house prices are $540,000 according to the latest February statistics and median household income is just $72,474. According to Demographia, the international agency that monitors housing affordability, house prices should be no greater than three times median incomes. In Queenstown, the average house price is 7.5 times the median household income.

Trustee and spokesperson for the Queenstown Lakes Community Housing Trust, Stephen Brent says the problem is stark in Queenstown where median incomes are typically lower than other parts of the country because of a high ratio of lower paid hospitality workers.

The table below compares affordability for different regions.

Mr Brent says high housing costs pose an economic and social challenge for Queenstown. “Housing is the single largest cost item for our struggling young households. As we improve affordability it frees up disposable income which can be spent elsewhere in the town. We also know that when families have good stable housing they are more settled in the community and less likely to pack up and leave town”.

Mr Brent’s view is supported by an independent survey commissioned by the Trust last year (2012). 86% of respondents said housing costs were a barrier to making a long term commitment to Queenstown. Other key conclusions from the report were that 40% of all respondents were in current housing stress, 95% aspired to home ownership, 80% said the quality of housing did not compare favourably with other places, 68% earned less than $50K and 80% were citizens or had permanent residency (not transient).

Adding to the pressure on housing is significant growth projections - more than 50% population growth over the next 15 years.

Julie Scott, Trust Executive Officer says the organisation is at the coal face.

“We see the affordability problem first hand. We are being approached by a growing number of eligible families seeking housing assistance from the Trust.”

The Trust operates a number of initiatives to relieve affordability problems for low-median income households including –

• Shared Ownership programme
• Rent Saver programme
• Starter Loans

The Trust has assisted nearly 70 households in the District to date.

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