WELLINGTON: New Zealanders’ average mortgage payments increased 27.5 per cent in the year ended June 2023, leading to more households spending a large proportion of their budget on housing costs, reducing the amount available for meeting other everyday expenses, according to the statistics department, Stats NZ, on Thursday, reported Xinhua.
The average weekly expenditure on mortgage payments, for households with a mortgage, was NZ$605.60 (US$374.68), compared with NZ$475 (US$293.88) in the previous year, up 27.5 per cent, which is the biggest single-year increase since 2008, Stats NZ said.
“The rise we’ve seen is primarily driven by increases in interest rates for mortgage-holders,” said Victoria Treliving, Stats NZ wealth and poverty statistics manager.
The weekly average spent on interest payments increased 49.9 per cent in the year ended June 2023, to NZ$311.60 (US$192.71), and principal repayments were unchanged, at NZ$307.90 (US$190.42), statistics show.
“Weekly payments on interest are typically higher than the amount spent on principal repayments although this was not the case in 2021 and 2022,” Treliving said.
In the year ended June 2023, one in five households in New Zealand spent 40 per cent or more of their disposable income on housing costs. This was an increase of 2.9 percentage points compared with the previous year, she said.
“The rise in mortgage payments has led to more households spending a large proportion of their budget on housing costs, reducing the amount available for meeting other everyday expenses,” Treliving said.
One in five households that paid a mortgage spent 40 per cent or more of their disposable income on housing costs, an increase of 4.2 percentage points, she said, adding that nearly one in three households that paid rent spent 40 per cent or more of their disposable income on housing costs, unchanged from the previous year. – BERNAMA-XINHUA
