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Housing crisis eroding New Zealand families' income gains

Xinhua, September 8, 2016 Adjust font size:

New Zealand's median household income rose by 3 percent a year since 2011, but gains are being eaten away by the country's housing crisis, according to a government report out Thursday.

Median disposable household income after taxes and transfers was 73,500 NZ dollars (54,846 U.S. dollars) in 2015, the Household Economic Survey report from the Ministry for Social Development said.

In real terms, it was 12 percent up on the pre-Global Financial Crisis median of 65,800 NZ dollars (49,100 U.S. dollars), said the report.

Social Development Minister Anne Tolley said the figures showed New Zealand had experienced a stronger recovery than many OECD (Organisation for Economic Cooperation and Development) countries since the Global Financial Crisis in 2008.

Net gains between 2009 and 2015 were better than for many OECD countries, such as Britain, Australia, Italy, Spain, France, Germany and the United States.

The report found that income poverty was either flat or falling and that there was no evidence of any increasing depth of relative income poverty over the last two decades, Tolley said.

However, the country's ongoing housing crisis, which has seen soaring home prices ripple out from the biggest city of Auckland - home to a third of the population - was having an impact on struggling households.

While the report found no evidence of any sustained rise or fall in household income inequality in more than a decade, she said, there was evidence that income inequality after housing costs had risen in the last few years as compared with the mid-2000s and earlier.

The main opposition Labour Party said the report made clear that New Zealanders were spending far too much money on housing costs as a proportion of their household incomes.

"For the bottom 10 percent the share of housing costs to incomes has risen from 29 percent to 54 percent since the study began," Labour finance spokesperson Grant Robertson said.

"Most New Zealanders aren't getting their fair share - the benefits of growth are clearly going to the top. This report shows that the incomes of the top 10 percent are now almost 10 times the amount of the bottom 10 percent." Endit